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Vishesh Khurana, co-founder at BigFoot Retail Solutions, turns enthusiastic when he starts talking about the sellers on Kraftly, BigFoot’s curated products’ marketplace. He talks about the diverse range of sellers—a 60-year-old lady who was once a Tarot card reader and now makes dream-catchers; “Ghanchakkar” a décor team that makes lamps out of old scooters, cycles and whatever else they manage to get their hands on; a large segment of sellers from Andaman who make coconut jewellery, and many more. 

Even though they have small teams (often less than ten), each seller has a story to tell. The Delhi-based BigFoot Retail, has one main objective—to make something big out of these small sellers. The market that the startup is addressing is huge—around $3 billion and the unorganised small and medium businesses (SMBs) segment alone, in India has around 50 million such sellers. 

Aimed at building an entire ecosystem around SMBs online, currently, the startup has three products—KartRocket, ShipRocket and Kraftly, and are working on the fourth. KartRocket is a ‘software as a service’ (SaaS) based e-commerce enabler that helps sellers start their own e-commerce store, while ShipRocket is a logistics aggregator that helps them ship their products. The company’s latest offering, Kraftly is a marketplace that brings together products crafted by a section of entrepreneurs popularly known as homepreneurs or solopreneurs, to help them test waters before setting up their own e-commerce store. 

Since he was a teenager, Saahil Goel was interested in building websites. Goel, who was working in the US at the time, couldn’t help noticing the exponential growth of Shopify, a Canadian e-commerce company that was helping SMBs in the US get online. 

Goel wondered if there was anyone doing something similar in India. Following some research, he realised that a lot of Indian sellers wanted to go online. Amazon managed to tap into this market and helped some of them get online. But they were comparatively larger businesses with 100-member teams. In the US, the smaller ones went to Shopify. In India, they were simply left out. This was when Goel had his eureka moment.

Replicating the exact Shopify model for the Indian market would not have been a good idea. “The mindset of customers in the US is very different. They have a ‘Do-it-yourself’ (DIY) mindset and are ready to figure out solutions for branding, marketing, logistics, etc. from different vendors. That model would not have worked in India,” Goel explains. Indian sellers needed an end-to-end solution to help them at each milestone of their e-commerce journey. “These are sellers who employ ten-odd people and usually clock a turnover of less than Rs.30 lakh a year. Our vision was to do everything possible to get these people online,” he adds.

Along with Gautam Kapoor, a childhood friend who was then involved in his family business, Goel began bootstrapping. A few months later, Khurana came on board. In 2012, KartRocket was launched.

“The companies that came to us at the time were mostly private labels and designers who wanted to start their own private brands. Some of our first sellers were Fatkart, Fatakk, SenseGiz, Tiekart, Kraftzone, DealBindaas and GoColor,” Khurana remembers. Being a SaaS platform, KartRocket’s revenue model was based on monthly pricing that ranged from Rs.2,000 to Rs.20,000 depending on the seller. In their run, the team has come across some unusual businesses such as CubeLelo that only sells Rubik’s Cubes online. “There is a Rubik’s Cube community in India with thousands of members, who keep buying these cubes. He started a store for that! Nobody would have thought it could be turned into a business,” Khurana laughs. 

ShipRocket was launched later in 2012. The logistics aggregator was introduced since smaller sellers have limited options for shipping their products on time. They are usually left with only two options—either they approach companies like Blue Dart directly, where prices are high, or a local aggregator who would charge a lot more, commission included. ShipRocket with its higher cumulative shipments managed to get better rates from their logistics partners. It presently works with ten logistics partners including Blue Dart, FedEx, and NuvoEx and has 19,000 pin codes covered. 

ShipRocket has an option where users don’t need to pay for a licence but only for shipping. Other plans available cost Rs.1,000, Rs.2,000 and Rs.3,000 per month with additional features such as multiple channels (Amazon, eBay, Shopify, Magento), automatic order sync, inventory sync, bulk shipment processing, etc. 

The team had built around 5,000 e-commerce stores by December 2015. By then they realised that the sellers still didn’t know how to market their products. The team then came up with the idea of a flea market to showcase their products. “If you go to a flea market or an exhibition, you can see how passionate they are about what they sell. They take a lot of effort to sell their products. If a person puts in that kind of effort, you know how far he can go to market his brand,” says Khurana. The startup on-boarded these sellers and launched Kraftly in 2014.

At Kraftly, it takes only a few minutes for a seller to go online—download the app, create a store, name, logo, and banner, upload five product pictures using the mobile camera, and the store is set up in the marketplace.  

Kraftly has devised a quality control programme to run background checks and identify fake sellers within 24 hours. Once the transaction is made, the seller receives the money only after getting customer feedback that the service provided was satisfactory. The platform charges a 10% commission and a 25% commission is charged for those wanting paid marketing services. 

“About 50% of the orders on Kraftly are organic. For the rest, products are advertised through paid Facebook ads, Google product ads, email marketing and SMS marketing. We will be launching a new marketing plan soon, where sellers can enjoy the benefits of a higher level of engagement,” say the founders. Currently, 70% of the sellers pay Kraftly a 10% commission for their marketing efforts. There is also a chat feature in the app, which allows buyers to bargain with the sellers, thus replicating the offline shopping experience, online. 

As they deal with an entirely different segment of sellers, Kraftly does not count Amazon or Flipkart as competitors. “Our sellers will not have a thousand pieces of the same product. They curate products, sell them, and then come up with something new. Flipkart and Amazon aggregate the organised sellers’ segment, while we aggregate the unorganised sellers’ segment,” Khurana explains.

The startup claims that they have around 30,000 active sellers, a majority of whom are from tier-II cities. Kraftly, which receives 3,000-4,000 transactions per day, gets 40% of its transactions from repeat buyers. The platform receives around 20 million page views per month and 80% of its traffic comes from mobile phones. User conversion rates vary from 2% on the web platform to 7-8% on the app. 

Are there overlaps between sellers on KartRocket and Kraftly? “Yes! That’s the whole idea. 100% overlap is what we want. That’s how we make money. Currently we are at 60-70% overlap and that’s a decent scenario,” Khurana says. What that means is that 60-70% of the sellers on KartRocket are also sellers on Kraftly. 

The team, which started off with Rs.50 lakh, raised seed funding from early stage investors—5ideas and 500 startups in 2013. In 2014, it raised $2 million in series A round, led by Nirvana Venture Advisors. In January 2016, KartRocket secured $6 million in its series-B round led by Bertelsmann India Investments and topped it up in March with $2 million more from Japan-based investor Beenos Inc.

“The series-B funding was mostly used for Kraftly. KartRocket is close to break-even at an operating level. We are reinvesting the money back into the business. As far as Kraftly is concerned, a lot of money is being spent on growing the business and hiring good people to get us to some scale,” Khurana says. 

In late 2016, the team hired former eBay executive Abhimanyu Lal as chief business officer at KartRocket. Most recently, it hired Akshay Gulati, former head of trade at Amazon UK, as chief business officer, Kraftly.

Pankaj Makkar, Managing Director, Bertelsmann India Investments believes that the team has got the right mix of people, apart from building the right solution for the Indian market. “We have not seen a team so complete at such an early stage of a venture. Early stage companies tend to have a lot of members with a tech background and very few with a business background. At BigFoot Retail, the management consists of a good combination of both business and technology leaders,” he says.

“Global players have tried to enter the Indian market, but their solutions are more suited for the Western market and so they haven’t made much progress here. Unlike most others who focused on desktop, KartRocket focused more on mobile phone solutions which has worked well for them,” says Rajan Mehra, Managing Director, Nirvana Venture Advisors. 

The startup reaches out to SMBs by creating content on topics like how to create a logo, how to run social media campaigns for a brand, etc. The team doesn’t believe in having field agents and feels it would be an entirely different project to handle for a small team of 200. “Kraftly uses digital marketing to acquire customers. A lot of our sellers also promote their Kraftly shops,” says Goel.

Dealing with the unorganised sector presents the startup with a different set of challenges. “For example, sometimes the seller is not ready to take back the product if the customer raises a complaint. We are able to manage the issue by absorbing some of it, because the brand shouldn’t get diluted,” Goel adds. 

Makkar believes that the startup is operating in the very space of e-commerce that has a multi-billion-dollar opportunity. “If you look at China, which is more comparable to India, Taobao had to build the entire ecosystem with its fleet of services and platform and that has worked fairly well for them,” he says.

By December 2017, BigFoot Retail expects to clock a revenue of around $4-5 million. The annual revenue run rate for ShipRocket alone, is expected to be a little over $2 million. “We are looking at an addressable market of 10-15 million sellers,” says Goel. Their aim is to have two lakh sellers on-board by the end of the year 2017. “We want to be the number one choice for small sellers to go online.”