Arzooo, an Indian startup that’s making an attempt to carry the “better of e-commerce” to bodily shops, has raised $70 million in a brand new financing spherical because it seems to scale its retail platform throughout the South Asian market.
SBI Funding and Trifecta Leaders Fund led the Bengaluru-headquartered startup’s Collection B funding. Tony Xu, founding father of DoorDash, Celesta Capital and three Strains VC additionally invested within the new spherical, which values it at $310 million. The startup has raised over $85 million throughout completely different rounds up to now.
Hundreds of thousands of retail shops in India are struggling to compete with giant retail chains and e-commerce giants Amazon and Flipkart as a result of they don’t provide a big selection of things and they’re unable to supply prospects with finest costs.
Based by two Flipkart alums, Arzooo is making an attempt to unravel this by working with huge manufacturers to safe giant inventories and promoting and delivering them to retail shops at higher costs.
The startup, which presently operates within the client durables and electronics class and offers shops with entry to over 10,000 completely different merchandise, says it really works with over 30,000 retail shops throughout 22 Indian states.
“The shoppers who’ve been strolling in and strolling out of those shops due to the pricing, we’re capable of assist deal with it,” mentioned Khushnud Khan, co-founder and chief govt of Arzooo, in an interview.
Flipkart alums Rishi Rathore (left) and Khushnud Khan co-founded Arzooo in mid-2018. Picture Credit: Arzooo
Arzooo has constructed its personal logistics provide chain community for last-mile supply of inventories and it additionally offers companies with working capital, giving them as much as $25,300 in revolving credit score.
“These are the shops that fall within the lowest slab of the worth chain. They don’t have entry to pretty much as good margin chain as say Reliance Retail and Croma and Amazon. They’re getting sandwiched between the 2,” he defined.
Arzooo is ready to ship these shops higher costs as a result of it’s slicing a number of intermediaries from the equation. “We’re partnered at the moment with most giant producers and nationwide distributors,” he mentioned.
These shops, whose dimension usually vary between 700 to 1,200 sq. ft space, clock between $12,500 to $19,000 of gross sales every month. They energy 75% of all client sturdy purchases in India, mentioned Khan.
“Arzooo’s enterprise mannequin could be very capital environment friendly and may meet the more and more diversified requirement of each retail outlets and finish prospects. It’s also nice for them to have constructed a self-branded practical logistics system, which is among the most necessary elements of the enterprise. There isn’t any restrict to the corporate’s future and we wish to totally assist the corporate of their approach to nice success,” mentioned Yoshitaka Kitao, chairman and president of SBI funding, in a press release.
Arzooo plans to deploy the contemporary capital to increase to extra Indian states and likewise launch consumer-facing providers, Khan mentioned.