eCommerce History Nepal (Kaymu to Daraz Journey)
While tracing the history of eCommerce in Nepal, the story of Kyamu, now known as Daraz, stands out, especially through the journey of its Managing Director, Rajeev Amatya. While Thamel.com and SastoDeal are popular, but Daraz has played a big part in growing online shopping in Nepal.A proud product of Vanasthali School in Kathkaymandu, Rajeev’slife has been a rollercoaster of unpredictable ups and downs. After finishing his +2 from St. Xavier’s, he moved to Switzerland for his bachelor’s degree. Once he completed his studies, he shifted to Germany and eventually got the opportunity to join an accelerator program with an Italian company. Along with two friends, he received an allowance of 2,500 euros including food and lodging. That’s where his entrepreneurial journey truly began.
Although that venture didn’t last, Rajeev returned to Nepal briefly before heading back to Germany after renewing his visa. While he was in Germany, he received a message on LinkedIn from a foreign company interested in investing in eCommerce in Nepal. At first, he didn’t believe it. But eventually, he agreed. That company turned out to be Rocket Internet. Soon after, TechCrunch featured the story, highlighting that Kyamu had secured foreign investment, creating a big buzz.
Kyamu started in a small apartment with just 20 to 30 staff members. It was introduced as an online marketplace in Nepal where sellers could list and sell their products. In the early days, sellers in Nepal weren’t very familiar with how online marketplaces worked, so Amatya and his team had to explain everything to them in simple terms. Most sellers would ask for credit, meaning Kyamu would take the products and only pay the sellers 15 days after the items were sold. To make sellers feel secure, Kyamu used to issue printed guarantee letters on official letterhead in the seller’s name, reassuring them their payment was safe.
Post-Earthquake and Blockade Kyamu Phase
E-commerce was growing steadily in Nepal, and Kyamu was doing well until the 2015 earthquake hit. Business slowed down, essential product sales dropped, and overall profits took a hit. Just as things were starting to settle, the India-Nepal economic blockade happened, which made the situation even worse. It led to big losses and a sharp decline in business. While many blamed the fuel shortage caused by the blockade for the problem, the real issue was the lack of available products to sell. It took Kyamu around one to two months to recover from the impact and get business back on track.
Kyamu-Daraz Merge
Before the merge, Daraz and Kyamu were two separate online shopping platforms, but both were owned by the same company called Rocket Internet. In Nepal, people used Kyamu to shop online, while in Pakistan and Bangladesh, both Daraz and Kyamu were running at the same time. Sri Lanka only had Kyamu. Later on, the company decided to combine everything under one name, Daraz. So, Kyamu was shut down, and everything was rebranded as Daraz. This made things simpler, with one name and one system for online shopping across all these countries.
British International Investment Fund Pump Up
After receiving funding and branding support from the British company British International Investment, Daraz underwent major changes in its policies and operations. One of the biggest shifts was the complete removal of replica and counterfeit goods from the marketplace, which led to a sharp 50% drop in sales, a significant decline. Along with this, Daraz announced that only officially registered sellers could operate on the platform, causing the number of sellers to drop drastically from around 4,000 to just 250. From that point on, all transactions had to go through the seller's official bank account, tightening financial transparency.
This period marked a consolidation phase for Daraz in Nepal, where internal restructuring took place, and despite political uncertainties like the risk of Nepal Bandas (strikes), operations continued without interruption. During these tough times, Daraz Nepal still managed to compete head-to-head with Daraz Bangladesh. Meanwhile, similar platforms in the region such as Kyamu in Cambodia and the Philippines had to shut down, but Daraz Nepal remained resilient and pushed forward.
Alibaba purchased 100 percent of it
After Alibaba took over Daraz in 2018, a major transformation began, starting with the installation of the Lazara system. The takeover was a big deal, with Alibaba reportedly investing around 200 to 300 crore Nepali rupees. This marked a turning point in foreign direct investment (FDI) in Nepal, especially in the e-commerce sector, which had mostly seen FDI in areas like hydropower and cement until then. After becoming part of Alibaba, Daraz focused heavily on its mobile app, which was more advanced than the website, offering personalized product recommendations. A dedicated team was even hired to help people install the Daraz app through Meta ads, referrals, and discounts. Earlier, Daraz itself handled tasks like product uploads and packaging, but post-takeover, suppliers had to manage these tasks on their own, leading to a 20% drop in seller participation. To support suppliers,
Daraz partnered with WorldLink and offered better deals to make uploading and packaging easier. This phase also saw the introduction of the Daraz Hub concept, centers where packed products were kept before delivery. On the logistics side, Daraz operated DEX, its own logistics arm, while also relying on third-party delivery services. They had dedicated teams for pickups and deliveries, and started accepting card payments, though initially users had to re-enter card details every time since card storage wasn't available.During this period, they actively collaborated with the government on various eCommerce-related laws and policy reforms.
Eventually, Daraz upgraded to follow PCI and DSS standards and introduced the Daraz Wallet, allowing users to collect points for discounts and other uses like shipping. By 2018–19, Daraz averaged 1,500 daily orders, and during their annual 11.11 campaign, they handled between 50,000 to 70,000 orders in a single day, making it a huge event in Nepal. To manage this spike, especially after festivals like Tihar, Daraz often hired third-party logistics companies like Atomix. However, third-party billing was restricted due to software needing government approval. Before Tihar, sellers preferred to run their own offers and avoided selling on Daraz, but after the festival, Daraz usually secured better deals because of slower markets and stock clearance efforts.