Meesho was founded by IIT Delhi graduates Vidit Aatrey and Sanjeev Barnwal in 2015. This social media commerce platform enables small businesses to sell online through various social media platforms like Facebook, Instagram, and WhatsApp. Meesho is now crowned as Unicorn, after raising $300 million in a funding round conducted by SoftBank Vision Fund 2. Consequently, the latest round of investment brought Meesho’s valuation to about $2.1 billion.
Meesho intended to employ this fund for assisting all kinds of small businesses to operate online, expanding their vision from only women entrepreneurs to small grocers like Kirana Stores, and investing in technology to provide them with logistics, access to selection, management, online payments, affordability of products and enabling easy buying experience for their customers. Online grocery has been mostly a tier-1 trend, with no such large e-commerce grocery players in smaller cities.
As it is recently identified that social commerce and business marketplaces can be potential competitors to e-commerce firms such as Amazon and Flipkart in India. The startup plans to enable these small businesses which constitute unorganized retail owners that exist across the country to compete online with large giants like Amazon, Grofers, BigBasket, and Flipkart. The prevailing investors like Facebook, Prosus ventures, Shunwei Capital, Venture highway, Knollwood Investment supported their vision and have also participated in the recent funding round.
Meesho has come a long way in the last 5 years after facing failures and challenges. In 2015, Meesho (meri-shop) was born after the failure of FashNear, a hyperlocal platform for fashion. In 2016, the Bengaluru-headquartered startup was one of the three companies developed in India to be selected for Y combinator, secured $120,000 in seed funding. In 2017, Meesho started giving access to several tools, logistics, and payments.
In 2018, it accomplished over 1 million resellers on its platform. In 2019, it became the first start-up in India to receive investment worth $25 million from Facebook. Their dynamic changed from FY 2020; they have grown in all particular fronts especially during the pandemic reason being the change in consumer behaviour towards buying essential items online.
Amidst the pandemic they have launched Farmiso, this product allowed many small businesses to start an online grocery shop. Farmiso has emerged as Meesho’s fastest-growing business. The numbers of women entrepreneurs pre covid were one-fourth of what it is today. “We take pride at the rate of speed and the scale at which Meesho has grown, positively impacting millions of lives, and creating exponential learning along the way,” said Vidit Aatrey, Founder & CEO of Meesho.
In just the last 1 year, Meesho saw a 10 times growth in monthly transacting users and 6 times growth in monthly orders.
Meesho has enabled 13M entrepreneurs to start their businesses with absolutely no investment and bringing the advantage of e-commerce to nearly 50M customers across the country. Meesho provides an effective platform for social resellers and SME suppliers and helps them provide a personalized experience to consumers. The startup has already delivered orders to over 26,000 pin codes in more than 4,800 cities from 1 lakh registered suppliers, generating over 500 crores in income for registered entrepreneurs and providing service to customers in more than 4,500 small cities.
According to the latest report, the startup serves around 10M re-sellers across more than 5,000 cities in India. Meesho has recently tied up with WE Hub to help women entrepreneurs in Telangana. The startup offers a selection from over 100+ categories, pan India logistics, payment services, customer support capabilities. Meesho conducted two ESOP buyback options for employees in 2020, the latest was conducted in November 2020 and was worth $5 million.
The startup will continue to conduct ESOP buyback in regular intervals. They will be hiring across the board focusing on tech and product. Meesho is a positive unit economics-focused company, planning to use the new fundraise to build up its talent pool across verticals of technology, business, product, and more. For the last five years, they have focused on enabling women entrepreneurs to sell online with zero investment, for the coming 18 months they will highly focus on grocery.
The new vision for the startup is to “build a single digital ecosystem for 100 million small businesses across the strata.” They plan to provide small businesses access to demand, the right tool, pricing their product by using the strength of artificial intelligence and machine learning to remove the barriers that exist online for small businesses.
Written by- Riya Kashyap
Edited by- Aditi Agarwal
The post The Rise of Meesho appeared first on The Economic Transcript.
