Less than five months after raising its last round of funds, Meesho, one of the fastest growing e-commerce companies in the country, has raised $50 million in Series C funding from new investors including Shunwei Capital, DST Partners and RPS Ventures, the company said on Tuesday. Existing investors including Sequoia India, SAIF Partners, Venture Highway and Y Combinator also participated in the round. Till date, the social e-commerce firm has raised nearly $65 million over three funding rounds.
Founded in 2015 by IIT-Delhi graduates Vidit Aatrey and Sanjeev Barnwal, Meesho operates as an online marketplace, which connects resellers directly with raw material suppliers. A majority of the resellers on the platform are homemakers, small business owners, small boutique brands and those who sell art and craft, fashion wear, home and kitchen products.
Meesho plans to use the fresh funds to build a stronger product and scale its technology team. The Bengaluru-based company recently launched personal care and nutrition categories on its platform and is piloting new segments.
“We want to build out a supply base—domestically and internationally as in importing from China. On the demand side we have been focused on expanding on our user segment—from housewives about a year ago to now a considerable chunk of our users who are students and working professionals,” said Aatrey, co-founder and chief executive officer at Meesho over the phone.
Meesho, which claims to have grown more than 100x in topline (sales) over the last 12 months, is among the few firms that have attracted investor interest after venture capital firms shied away from investing in e-commerce in late 2015.
More than 30% of Meesho’s user-base is non-English and it plans to launch in new vernacular languages over time to go deeper into smaller towns and cities. Currently, it has over 1 million resellers on its platform. For every transaction, a reseller makes a 10-20% commission.
RPS ventures, set up by SoftBank Investment Advisers managing partner Kabir Misra, was looking to invest in Meesho and insurance provider Ackho, Mint reported on Monday.
“We (RPS) are hoping to assist them with our accumulated experience in the sector to further grow their business in India and beyond,” said Misra, founder and managing partner, RPS Ventures.
Meesho’s business model is largely built around small and medium businesses, and most sales is processed within a network of repeat buyers. The facility to chat online helps resellers identify trusted buyers within their network.
“We strongly believe that Meesho’s social reselling model is highly suitable for the great number of new-to-internet buyers,” said Tuck Lye Koh, founding partner and chief executive at Shunwei Capital.
Shopping on social media services including Whatsapp and Facebook account for roughly 80% of India’s total commerce, according to a PayPal Report. Of late, investors have started pouring money into social commerce startups such as Shop101, Glowroad and Ezmall to capture the next 500 million internet users.
“Going ahead it’s going to be a massive business as such, maybe bigger than any of the e-commerce companies you have seen,” said Aatrey.
Source: Business-Standard