A startup that is helping more than 125,000 neighborhood stores in India to secure working capital, list from top brands and work with e-commerce firms said on Thursday that it has launched a new way to expand its reach in the world. Financing round is raised. Second Largest Internet Market.
Pune-based ElasticRun said it has raised $ 75 million in funding for its Series D, led by existing investors Avataar Ventures and Prosus Ventures. Current investor Kalari Capital also participated in the round, taking the four-year-old startup’s date-up to $ 130 million.
Millions of neighborhoods in large and small cities, towns and villages in India have proved difficult to defeat for store and e-commerce giants and super-chain retailers, which are at the center of a new drama in the country.
Scores of e-commerce companies, offline retail chains and fintech startups are now racing to work with these mom and pop stores as they exploit a largely unexplored opportunity.
ElasticRun helps merchants operating these stores, who typically have to spend a few days a month visiting large cities to secure inventory, getting reliable and more affordable goods directly from big brands. (Big brands like this because it enables them to expand their reach.)
These shop owners spend many hours of the day, when business is slow. ElasticRun is also addressing this by partnering with some of the largest e-commerce firms including Amazon and Flipkart to use this workforce to deliver to customers. (E-commerce firms get its value because neighborhood shops have a large presence in the country, can reach customers much faster, and often have their own inventory.)
Ashutosh Sharma, head of investment for India at Process Ventures, told ClearTips that ElasticRun has built a variable-capacity, crowdsourced delivery model that differentiates startups from other market players, who make these deliveries. There are a fixed number of people on the payroll. He said the startup has developed railroads, unlocking many new opportunities.
One such opportunity is providing working capital to these neighborhood shops. Their operators typically do not have savings, and need to sell existing inventories to secure funds to replenish stock. In recent years, ElasticRun has partnered with banks and NBFC to provide loans to these merchants.
ElasticRun operates in more than 300 cities in almost all Indian states today. In an interview with ClearTips, the startup said ElasticRun co-founder and chief technology officer Shitz Bansal said that the startup works with 125,000 neighborhood stores and plans to reach 1 million in 18 to 24 months.
He said the startup’s current run rate is $ 350 million, a figure that is planned to exceed $ 1 billion over the next 12 months.
Co-founder and chief operating officer Saurabh Nigam said the new financing round has enabled startups to offer early employees up to “tangible benefits” of the firm’s growth over the past five years.