Banglore based online re-seller marketplace Meesho has raised $3.4 million the latest funding round led by SAIF partners. Its existing investors Y Combinator and Venture Highway also participated in the funding round. The latest funding brought the total funding raised by the startup to $3.7 million.
Meesho will use the newly acquired funding to launch new product categories and also hire more people in its tech and business operations teams.
Meesho helps small business owners, especially housewives, manage their e-tailing businesses via social media platforms like WhatsApp, Instagram, and Facebook. It connects suppliers with buyers. People use their channels such as WhatsApp to promote their brand or product within their network. Since most of the items are delivered directly from manufacturer to the customer, resellers do not have to maintain their own inventory. Meesho takes a 7 to 15 percent commision from suppliers for every transaction based on the category of product. Meesho claims that its platform is used by around 1000 suppliers and 20,000 resellers.
The company has also partnered with a number of logistics companies to smoothen the process of deliveries. About half of its orders are fulfilled via cash on delivery. Around 25 percent are fulfilled through payment gateways, for which, Meesho has a tie-up with RazorPay and rest of the orders are accomplished through mobile wallets.
The company has to compete with major social media platforms like WhatsApp, Facebook and Instagram, who already have introduced a lot of features for small business owners. Apart from these, Meesho’s other competitors include Shopmatic, Zepo, Kartrocket and Shopify.
The company says that because the advent of smartphones in India, the number of resellers in the country has increased to a great extent. There are currently around 3 million resellers in India and it is expected to grow by six to eight times in the next five years.