Tokyo based platform for freelancers, Zehitomo, has raised US$ 7.6 Million in a sequence B funding round led by DG Daiwa Ventures on 11th June, 2020. They claim to employ the funding by hiring more talents in addition to drive the supply aspect of local services online.
Real estate developer Mitsubishi estate, venture capital firm Energy and Environment Investment, AirTrip, Coral Capital along with SMBC Venture Capital, Mizuho Capital, Persol Innovation Fund and few individual investors were also engaged in the round.
Zehitomo, provider of an online matching services platform connects people who search for offerings with experts consisting of photographers, contractors, remodelers, yoga teachers and consultants, with users. Last year, the Japanese start-up evolved an AI feature that enables it to choose the right specialists that suit a client’s requirements, beefing up its recommendation system.
The company said the investment will help support small and medium-scale enterprises and ramp up headcount.
CEO and co-founder of Zehitomo, Jordan Fisher, stated their provider works otherwise from the conventional model where systems take a margin in between transactions. “Our business model is lead generation, which means that the professionals pay to be introduced to client leads that they are interested in,” he said.
Launched in 2015, the start-up claims that more than 200,000 businesses so far have registered with the platform and more than US$ 100 Million worth of job requests have been generated through Zehitomo last year.
Fisher however noticed the fluctuating demand due to Japan’s state of emergency in response to pandemic outbreak and the biggest drop was seen in events related services such as emceeing and photography. Meanwhile, there has been an increase in demand for wellness practitioners, online lessons and certain home development services.
Demand has since recovered, Fisher noted, vastly due to the country easing into normalcy but Zehitomo is, however, still a supply-constrained commercial business.
“Consumers are searching online, but local service professionals like plumbers still use fax machines. So our challenge has been how fast we can bring the supply side online,” he said.