Three-year-old social e-commerce start-up DealShare on Friday night said that it has raised $165 million in the first close of its Series E fund raise, at a valuation of $1.65 billion, making it the latest entrant to India's coveted unicorn club. The company welcomed Dragoneer Investments Group, Kora Capital and Unilever Ventures, along with continued commitments from existing investors Tiger Global and Alpha Wave Global (Falcon Edge).
The company has been growing its consumer and revenue base strongly and expects to hit $1 billion revenues in the near term. The funds raised in this round will be utilized to invest in technology and data science, as well as a ten-fold expansion in its logistics infrastructure and to increase geographic reach. In addition, it will establish a sizable offline store franchise network. The funding is also expected to help the firm compete with other social commerce players such as SoftBank-backed Meesho, BulBul, GlowRoad, Mall91, and simsim and Flipkart’s social commerce platform Shopsy.
"DealShare is one of the fastest growing e-commerce companies in India. Our revenues and customer base have grown 13 times in the last year with improving profitability,” said Vineet Rao, founder and CEO of DealShare. “With a strong customer base of over 10 million, we have expanded our geographical presence to over 100 cities across 10 states. Our company has created job opportunities for over 5,000 persons across the country.”
In July last year, DealShare, which has built an e-commerce platform for middle- and lower-income groups of consumers in India, raised $144 million in its latest funding round, led by Tiger Global. The firm is known for pioneering the CGB (community buying group) model in India. The funding had taken the valuation of the firm to $455 million.
DealShare said it has built a new disruptive retail model for India focusing on affordability for mass consumers. It offers high-quality, low-priced essentials coupled with a gamified, fun-filled, and virality-driven shopping experience, making it easy for first-time internet users to experience online shopping.
“We have created a network of over 1,000 community leaders under our flagship program DealShare Dost enabling an efficient and highly scalable supply chain,” said Rao. “We will be utilizing the proceeds from the round to invest heavily into technology, improving the supply chain and expanding our footprint throughout the country. We will also invest in acquiring best-in-class technologies and marquee brands that are focused on the mass market.”
The firm said that its annual revenue run rate has crossed $600 million. Griffin Schroeder, Partner, Tiger Global said DealShare is growing rapidly and has built an impressive customer base with a strong leadership team executing on its innovative social commerce strategy. “As it expands into tier 2 and tier 3 cities, DealShare is well positioned to power a new wave of e-commerce growth in India,” said Schroeder
Sharing his vision for the company's growth trajectory, Sourjyendu Medda, Founder, chief business officer, DealShare, said the firm is witnessing very high growth in our business. “This year, we will be expanding our presence to well over 200 cities across 20 states and are setting an audacious goal to increase our annual revenue run rate to $3 billion while becoming operationally profitable,” said Medda. “We also aim to add close to 50 million new consumers in the next 12 months.”
The company’s mission is to increase affordability and accessibility of high-quality products at low prices for mass consumers. The firm has created a unique network of more than 1000 small and medium manufacturers in the grocery and essential space which allow us to enable our mission. “Majority of our consumers are first to e-commerce because of us. Not only are we spearheading e-commerce adoption in the country but we are also doing that with ‘Atmanirbhar Bharat’ as the key focus,” said Medda.
DealShare operates over 100 warehouses in the 10 states it operates in, and plans to expand its warehousing from 2 million square feet today to 20 million square feet over the next 12 months.
Navroz D. Udwadia, co-Founder and Partner, Alpha Wave Global said that DealShare delivers a compelling value proposition to its customers, who are value-conscious middle Indians in Tier 2 and 3 cities who crave local and regional products.
Founded by Vineet Rao, Sourjyendu Medda, Sankar Bora, and Rajat Shikhar in 2018, DealShare provides a sharp and curated assortment at highly competitive prices and has built an innovative community leader driven ultra-low-cost delivery mechanism collectively leading to best-in-class unit economics. DealShare has boosted its senior leadership by recruiting top industry leaders with deep experience in retail and consumer technology.
The next frontier in e-commerce is social, according to a report titled ‘The Future of Commerce in India – the rise of social commerce’ by Bain & Company in partnership with Sequoia India.
The report expects that social commerce, which is a $1.5 billion to $2 billion market today, will be worth as much as $20 billion in just five years—and will likely hit nearly $70 billion by 2030. In short, India’s social commerce sector will be twice the size of the current e-commerce market within 10 years.