A decade ago, Saahil Goel was looking to build his version of Shopify in India, a platform for small businesses to be able to sell online. He called it KartRocket (and later Kraftly), but the idea didn’t fly.
Ecommerce itself was in its infancy in the country, and Saahil would eventually come to terms that there was not much demand yet for such a service. Saahil, along with Chief Business Officer Akshay Ghulati, then decided to use the platform to address a more fundamental problem: that of a lack of reliable shipping for small merchants.
KartRocket became, a logistics aggregator for ecommerce.
With Zomato-backed Shiprocket nearly a unicorn now—it was valued at nearly $930 million when it last raised funds in December—Saahil, the CEO, and Akshay, now a co-founder, want to turn the clock back a little.
The timing wasn’t right for the (Shopify-like) platform back then, Saahil tells YourStory Founder and CEO Shradha Sharma in an exclusive interview. “We were way too early,” he says, “we were having to convince people to go online.”
Shiprocket, with five tuck-in acquisitions since it was founded in 2017, has since come a full circle, with the founders creating an ecosystem of services—from online order-taking to deliveries—for any merchant who wants to sell online.
In other words, a single gateway for merchants and direct-to-consumer brands that want to sell independently. Several D2C brands in India, despite having their own online presence, rely on ecommerce platforms for visibility as well as for services such as order fulfilment or delivery. But that eats into their margins.
“The next wave of D2C commerce in India will come from Tier 2 and Tier 3 cities. Today, no one is focusing on how to educate and train sellers in these cities, and that market is underserved,” says Akshay, who joined Saahil at Kraftly in 2016 from Amazon’s UK business arm.
“What Amazon and Flipkart did for Tier-1 and metro cities in the early part of the decade, Meesho and others are doing for Tier 2 and 3 cities now, with people getting used to buying online.”
Saahil insists that, despite the pivots, the company’s mission is focused on levelling the playing field for merchants.
“The horizontal marketplaces did a great job of taking everything from order, last-mile delivery, returns, loyalty, remarketing, and customer service into a single button. How do we do this for direct commerce and independent businesses? That became our five-year mission.”
Building Indian ecommerce for Bharat
As an answer to that, Shiprocket made multiple acquisitions: cargo shipping business Rocketbox, supply chain management solution Glaucus, marketing automation platform Wigzo, logistics aggregator Pickrr, and recently, Omuni, Arvind Internet’s retail enablement business.
These plug-ins become important for the company to be able to attract new and emerging businesses to its platform, which already works with merchants of varying sizes.
Shiprocket also wants to leverage its ability to be a distribution channel for business by building a technology stack for online sellers.
“We are also a great distribution engine. Nearly 1 lakh merchants work with us; they pay us every quarter. If someone is sub-scale but has a great product, we can help them in distribution,” says Saahil about the company’s acquisition strategy. “It is a win-win.”
Shiprocket has powered 85 million unique transactions over the years, with an increasing number of sellers and customers coming not only from the big metros but also smaller cities and towns.
“Our demand side trend has inverted,” he says. “What used to be 70-30 in Tier 1 (versus Tier 2), is now 35 Tier 1 and 65 Tier 2… Lot of buyers are sitting in Tier 2, 3 cities.”
With that, Shiprocket is also onboarding more sellers from smaller cities. “A lot of it changed during COVID, which is when a lot of (sellers) needed to change, experiment with that business model.”
From India to the world
Apart from its platform-as-a-service play, Shiprocket is also working to take domestic D2C brands and online sellers global. The company announced the launch of its cross-border business, Shiprocket X, in June, aiming to make shipping hassle-free for international orders as it has done for domestic shipments.
“About 2-3 years ago, a lot of sellers who were successful selling online globally were selling on Amazon through FBA (Fulfilled by Amazon), eBay or Etsy. It is a pipedream for most entrepreneurs selling domestically,” says Akshay.
He adds that increasingly, Indian brands and sellers know whom they want to sell to globally, but also want to own the customer experience, ensuring higher repeat rates and better returns on their overseas investments.
“It is very complex. We started (Shiprocket X) last year and we launched in June this year. It took us six months to get through customs and exports,” says Akshay, adding that as international markets became a natural extension for new brands emerging in India, cross-border shipments became a natural extension of business for Shiprocket.
With these moving parts, Shiprocket wants to be “the NPS-as-a-service platform for merchants,” Saahil says half-jokingly.
NPS is a measure of customer satisfaction for ecommerce businesses, and indicative of how likely customers are to recommend a product or service to others. The success of a business depends on defining the best experience for online sellers across the spectrum.
“We believe that ecommerce needs to be democratised,” says Saahil. “The right way to build technology should be to make lives for everyone better, and not for just a few people.”