Sulekha: The growth of a local service provider
What started off as a collaborative article-writing portal, transformed into a medium that offered free email accounts and, in late 2000, started the online advertisement to those who might be interested in publicizing their website via Sulekha.
Given the growth and expansion of e-commerce and mobile business, Sulekha was one of the earliest start-ups in India to catch up with the Internet age in the 1990s.
Ranked among the top 50 digital properties in India, Sulekha has doubled its revenue in the past three years and accelerated its growth through its local services app that helps in capturing the local service users need and getting businesses to quote a price for their service need.
Last week, Sulekha was a winner at the mBillionth awards. “mBillionth has been recognizing excellence in mobile innovations for the past five years and we are delighted that our mobile app has been considered as a finalist for the upcoming meeting on 23 July,” Satya Prabhakar, chief executive and founder of Sulekha, said in an interview before the awards were announced.
Born in Machilipatnam in Andhra Pradesh, Prabhakar, an alumnus of the National Institute of Technology, Trichy, holds master’s degrees from the University of Florida and an MBA from Warrington College of Business Administration. He worked with various organizations in India and the US before founding Sulekha with his wife in 1998.
Sulekha is now one of India’s largest and fastest growing digital platforms in the local services and listings ecosystem, with over 800 categories serving millions of users and local businesses. It is also the largest in terms of having more than 75,000 paid local service providers who cater to more than 2 million users each month. Today, the firm has more than 1,500 employees in 15 offices across India and the US.
In its third round of funding in April, the service listing company raised Rs.175 crore from Singapore’s sovereign wealth fund GIC and venture capital firm Norwest Venture Partners.
“This is a powerful endorsement of the vast potential of the local services opportunity in India and Sulekha’s ability to prosecute it successfully,” said Prabhakar.
The Chennai-based start-up raised its initial investment from Indigo Monsoon Group. In 2006 Norwest invested around $10 million in the company. Initially completely reliant on advertising to generate revenue, Sulekha started charging customers in 2009.
In 2011, Japan-based Mitsui and Co. Ltd had invested $8 million, and in 2007 Norwest had invested $10 million.
The local services classifieds was redesigned in 2005 to allow users to select their location in different states in the US and Canada. Also, a few Indian cities were added, including Bengaluru, Chennai, Delhi, Hyderabad, Kolkata and Mumbai. Dubai, London and Singapore were also added later.
Currently, Sulekha’s revenue is nearly $30 million and it is one of the three digital companies in India that is profitable, apart from Info Edge and Just Dial.
“Sulekha.com is one of India’s largest and fastest growing digital platforms for local service need fulfilment in over 40 cities, connecting over 30 million visitors with over 3 million trusted local service businesses each month,” said Prabhakar.
Sulekha estimates to have captured the needs of 16 million users in 2014-15 and targets 50 million local service user needs in the next two years. According to the firm, those 16 million users were covered via its website, mobile website and mobile app. More than 30% of the user needs for local service happen via the mobile.
“Due to the varied nature of services that happen in more than 24,000 location-categories on the website and app each day, we enable users to talk to trusted service providers and track their fulfilment. However, we are experimenting with several models to make it commerce enabled on both the PC and mobile Web or mobile app,” said Param Parameswaran, chairman of Sulekha.
Sulekha’s four global investors are GIC (Singapore), Norwest Venture Partners (Palo Alto), Mitsui (Tokyo), IMG (New York).
Mint has a strategic partnership with Digital Empowerment Foundation, which hosts the mBillionth and Manthan awards.