What would you rather have? Shopping online in the comfort of your home or shopping in the store?
Most of you will find option one more appealing, given the popularity of e-commerce platforms.
Now, what would you rather have, set up your physical store or sell it online?
It’s a difficult one. Most individuals want to start their own business, but they do not have access to capital and the market. But with a platform like Meesho, it’s child’s play.
The platform makes online shopping affordable and encourages small businesses and individuals to start their online stores with Zero Investment through social channels like WhatsApp, Facebook, Instagram etc. and do something on their own. The start-up aims to democratize Internet commerce.
While Mesho is not unknown to us, the origin story with her two IIT Delhi founders – Vidit Aatrey and Sanjeev – may be. The year was 2015, the two young batch mates (2008-12) gave up their jobs and laid the foundation stone, their long dream to start their own business. They came up with the idea of building a platform to help MSMEs (Micro. Small and Medium Enterprises).
Initially referred to as FASHNEAR (which lacks a state-of-the-art revenue model), Meesho was inspired by those retailers who sold goods via WhatsApp, but their reach was limited because they supply their goods to customers in ‘ a neighborhood. Vidit and Sanjeev saw a unique business opportunity here.
Serving as a bridge between suppliers-manufacturers and retailers (who list their products on Meesho) resellers, and customers, Bengaluru-based Meesho has now become a favorite among Indians.
What worked for Meesho?
Make online resale and shopping hassle-free and affordable, Meesho works on a commission of around 10-15%, and sellers can earn money with Meesho by entering a gross margin for each transaction.
Meesho earns the trust of more than 2.6 million resellers across India, and delivers secure and timely transactions, as well as low returns and shipping to users.
After finding that most of the stores registered on Meesho were operated by women, who sold their goods from their homes instead of all physical stores, Meesho’s current business model was built for women. They are encouraged to start a resale business at home, without having to pay inventory.
Meesho, thriving for women’s financial independence, also enables small shops and manufacturers to deliver their goods nationwide, ensures the delivery of the products, and facilitates COD options themselves.
Growth and performance
At a time when social commerce was struggling to occupy space in India, Meesho led the way and revolutionized the industry. In just 5 years, they reached the $ 1 billion valuation milestone, most recently capital for Meesho came through a debt financing round on October 20, 2021.
As a fast-growing e-commerce platform, SoftBank-supported Meesho has recently reached a milestone by recording more than 14 million orders in just 3 days, surpassing last year its peak Diwali sales orders this year.
Currently valued at $ 5 billion (March 2022), this start-up has invested $ 8M in Latin America’s top social commerce platform Elenas.
Meesho recorded a 2.6X growth in operating expenses in FY21 and 3.8X growth in FY20, Meesho boosted its business income to 793 crore, has also earned non-operating income 48.5 crore, with an average of ~ 90 million orders each month.
With multiple awards won, in September 2021 the start-up was named the most downloaded e-commerce app in the world (Google play store). As per their website, by helping 13 million women start businesses with zero investment, and with over 75% of their users coming from Tier 2+ cities, they claim to have taken e-commerce to untouched markets.
From fundraising, providing bottlenecks, logistics, transaction alternatives, and competition from contemporaries, Vidit and Sanjeev’s trip to Meesho was no cakewalk.
As the first e-commerce platform to announce zero percentage commission for sellers, Meesho had really emerged as a poster boy in the social commerce segment some time ago with its value estimates of $ 4.9 billion.
However, as the entire nation came to a standstill and the economy was under great stress, Meesho also witnessed difficult times. Because fashion was not one in mind during the pandemic with a bottleneck in the supply chain and cash crunch created by lockdown, declining revenues for female entrepreneurs and resellers also drastically.
That’s when they started pushing for advanced logistics solutions and vital supplies (masks, personal care, sanitizers, and groceries) to their resellers, a category they had never sold before. They also devised a scheme to sell masks made at home by their resellers.
Adapted to the changing environment, Meesho has witnessed changes in its strategy from social commerce to B2C and has jumped from a zero-commission model to ad-monetization. It is also said that it has abandoned international expansion to promote shopping in small towns.
Initially competing with Shop101 and Glowroad, Meesho now faces stiff competition from larger e-commerce players such as Flipkart and Amazon. With its Shopee app, Flipkart gives Meesho a hard time, and takes away a piece of its resellers.
By December 2022, Meesho sees 100 million monthly transaction users and plans to use the new investment amount to redouble its technical and product capabilities, expanding its product list to more than 50 million merchandise to become India’s preferred platform for users, entrepreneurs and vendors.
Farmiso (Meesho Grocery), Meesho’s community group purchasing (CGB) company, is also trying to expand its grocery shopping and fast-moving services to more than 200 cities.
As per sources, Meesho is looking forward to an IPO in early 2023. It plans to prepare its listing by the end of 2022 and assesses both the Native American and U.S. markets for its public listing.