Zefo raises $6 million from Sequoia, others
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Mumbai: Bengaluru-based used goods marketplace Zefo said on Monday it has raised Rs40 crore (approximately $6 million) in a funding round led by venture capital firm Sequoia India, with participation from Beenext and existing investor Helion Venture Partners.
Zefo is a marketplace to sell and buy used goods, currently serving two categories—appliances and furniture. Present in Bengaluru, Mysore, Delhi, Gurgaon, Noida and Mumbai, the company currently offers televisions, refrigerators, washing machines and microwaves under the appliances category and beds, sofas, dining tables, etc. in the furniture category.
Zefo was founded in August 2015 by Rohit Ramasubramanian, a former Helion Venture executive, Karan Gupta and Himesh Joshi and Arjit Gupta.
According to Ramasubramanian, co-founder of Zefo, the idea behind launching Zefo was to solve the key issues of trust and convenience that faced buyers and sellers of used goods.
“We looked at the second hands goods space and it seemed like a very inefficient market. The two core things we wanted to solve were the problems of trust and convenience both for the sellers and the buyers,” said Ramasubramanian.
Household goods are a $40-50 billion market and is growing rapidly, he said.
“Zefo is currently growing at a rate of 40% every month. Since our launch, we have already served 30,000-plus customers, selling 400-500 products a day,” he added.
Unlike most classifieds platforms, which let buyers and sellers directly interact with each other for a transaction, Zefo buys goods from sellers, refurbishes them and then puts them on sale on its platform for people looking to buy used products.
This allows Zefo to provide standardization and quality and manage the end-to-end logistics, thus reducing hassles for both sellers and buyers.
The start-up will use the funding to expand its presence in Mumbai and Delhi, which have been recent additions.
“We entered Mumbai one month ago. Even in Delhi where we were earlier only doing furniture, we have recently added appliances. For the next few months, we want to go deep in these categories and these two cities,” said Ramasubramanian, adding that Zefo will look to further its geographic expansion in another 6-8 months.
By end of 2017, Zefo hopes to be in the top eight cities of India, he said.
The funding will also be used to expand its team and invest in technology.
“Investment will go into team and technology. Operationally complex model and technology plays a big part in streamlining it as much as possible. So, a good amount of funding will go into tech and talent,” said Ramasubramanian.
Zefo has around 150 people as of now, across functions such as technology, product and marketing.
Ramasubramanian said that in the long run, Zefo will also enter the consumer electronics category—another major used goods category.
“Consumer electronics is something we have an eye on, though it’s at least a year away,” he said.
Apart from serving individual buyers and sellers of used goods, Zefo also helps several online and offline retailers with their exchange programmes.