With ShopClues, I founded India’s first fully managed marketplace at an era when 100% of other E-Commerce companies were inventory led model. Being the first managed marketplace, we were truly the first one in India to be an non-inventory led business model and provided payments, catalog, fulfillment, verified sellers and common rules/policies for all the sellers as the first marketplace in India. We were the 35th entrant into Indian E-Commerce but became 5th largest within first year of the commercial launch. Later on, almost all horizontal E-Commerce companies followed ShopClues business model.
I built ShopClues because I saw an opportunity to empower 15 million SMEs in India who sell something for living out of the total of 45 SMEs in India. Most of the SME sellers do not know English, do not know technology and do not have deep pockets. Most of them are inch wide and mile deep but otherwise inch wide into one category or line of products. They are typically family owned businesses and cater to local areas. I thought would not it be nice to create a platform for these SMEs to become geographic agnostic so that they can sell online at scale without having to worry about language, technology, marketing or capital. Also, I felt very passionate about aggregating non-standard categories such as clothing, shoes, accessories, home, kitchen, jewelry etc. at a scale not done by anyone in India. I also had a vision to make it easy and more accessible hard to find items or long tail items. In India almost all categories have long tail.
I was very clear that India did not need another eBay and the current inventory led model will not go too far due to structural limitations in their business model. Besides, in 2011, I found all Indian companies spending very irrationally in marketing, promoting cash on delivery and no focus on innovation or fundamentals of the business. So, I reach to a natural evolution in my life where I thought that the regret of not doing ShopClues would be bigger than I give up. So, I decided to bring three big changes in my life – I left my job to become an entrepreneur, I asked my spouse to join me, and I convinced my family to move to India.
So I strongly believed in five things:
- Because in India, almost all categories have long tail vs. large head, cost of capital is very high, and consumer demands are choppy, ultimately a marketplace would win vs. an inventory led model.
- Using ShopClues tools, technology, platform and services, empower third party sellers in a way that translates into buyer value proposition that no body can match. So, at ShopClues we cracked the code on chicken and egg by focusing on seller first but delivering unmatchable value to buyers.
- ShopClues is neither an E-Commerce company and nor a retail company but a platform company that provides an online operating system on the cloud to the third party to sell at scale with low transaction cost.
- I believe in completely performance based marketplace and that means no insertion fee, no listing fee and seller only pays when you sell.
- We would bring a first managed marketplace and offer fulfillment, payment and verification services only for B2C sellers to address the unique characteristics of India. Unlike, US, Western Europe and Japan, India is the low trust market and nothing but a managed marketplace would have only survived at time when E-Commerce was still in its infancy.
First 5 to 6 months, I was on my own before my spouse Radhika joined me full-time (although she helped me during the entire journey including playing a pivotal role for me to become an entrepreneur), followed by Sanjay Sethi, followed by Mrinal Chatterjee, and within weeks after I landed in India in August 2011, I had met Devesh Rai, who became the fifth core team member. In terms of team, I could not have asked for a better team and I knew from day one that it was a dream team and the winning team.
Radhika and I had been married for 13 years and dated for two years before we decided to do ShopClues and move to India from Silicon Valley. I had met Sanjay Sethi for several months in the beginning of 2011 as our kids went to same school. Besides, Sanjay had heard about me because I was an analyst and covered eBay’s stock, where Sanjay worked for several year. Mrinal worked with Silicon Valley for nearly 18 years and in his last role, in Silicon Valley, he was VP of Engineering at an Internet start-up ran by my friend. I literally poached Mrinal from there. Devesh and I got introduced through someone who knew Sanjay Sethi from prior. So, this is how the winning team was created.