The race is to be the first e-commerce company to be profitable at a certain scale: Sanjay Sethi & Radhika Aggarwal
For the past two years, January has been a key month for ShopClues, the Gurgaon-based online marketplace for unbranded goods. In January 2015, the company was in news for securing $100 million from Tiger Global with a valuation of $500 million.
And this January, it has become the ninth start-up to join India's unicorn club by raising about $150 million from Singapore government's GIC and its existing investors, Tiger Global and Nexus Venture Partners.
This is quite an impressive track record for a four-year old company fighting out for a chunk of the buzzing e-commerce market in India.
It was the immense experience and leadership of Sanjay Sethi and Radhika Aggarwal, the co-founders of ShopClues, that has carefully knitted the ShopClues story. Both can be rightly called veterans in e-commerce as they were working in the e-commerce space in the US. This was before they decided to become entrepreneurs in 2011.
Sethi set up the firm along with the Aggarwal couple, Sandeep and Radhika, in 2011. "Our daughters were classmates in school in the US and their bond brought us together. We were all excited about the India growth story and wanted to come back," Sethi says. This is how ShopClues was founded.
Sethi, an alumnus of the Indian Institute of Technology Delhi and Banaras Hindu University, moved to the US in the late-1990s for work. His career there revolved around internet product development, including e-commerce marketplaces, online payments and operations. He was the global product head for shipping and logistics, payments and billing for eBay at its headquarters in Silicon Valley. Sethi had played a key role in setting up the India office of eBay around 2010.
This experience has been a key factor in driving ShopClues's business in India.
While Sandeep Aggarwal, also the founder of Droom, a mobile marketplace for used automobiles, still has a stake in ShopClues, it is his wife, Radhika, who drives the business. Like Sethi, Aggarwal, too, has about 14 years of experience in the US. She was involved in marketing for diverse sectors including retail, e-commerce, fashion and lifestyle with companies like Nordstrom and Goldman Sachs in the US. She has an MBA from Washington University and a post-graduate degree in advertising and public relations.
According to Aggarwal, Indian e-commerce is a battle which they had been fighting from Day One. "When we decided to set up our company in India, we had even got a term sheet from a large venture capitalist in the US to come and start ShopClues. But then a news article did the rounds saying Amazon was launching in India. And our term-sheet got withdrawn," she says.
Even in 2011, India was a crowded market with a bunch of players already in operation. "But then we had a clear vision of standing out from the first day, which was our marketplace model," she adds.
Both Sethi and Aggarwal were betting on three basic things: the fragmented retail segment, immense scope for offline retailers to expand and existing models which were inventory-based. Four years later, their gamble has worked and ShopClues has become worth a billion dollars.