Meesho in funding talks with Sequoia Capital, SAIF Partners
E-commerce firm Meesho had raised $3.1 million in a round led by SAIF Partners, Y Combinator and Venture Highway in October 2017
Bengaluru: Social commerce platform Meesho, which uses social media services like WhatsApp and Facebook to drive e-commerce, is in talks to raise $10-15 million from Sequoia Capital and SAIF Partners, people familiar with the matter said.
Meesho is one of few new e-commerce start-ups that has attracted investor interest after VC firms’ interest in e-commerce companies started souring late in 2015.
The company operates as an online marketplace, which connects resellers directly with raw material suppliers. A majority of the resellers on the platform are homemakers, small business owners, small boutique brands and those who sell art and craft, fashion wear, home and kitchen products, among others.
Resellers create a customized catalogue of products using Meesho’s mobile app; these catalogues can be shared via WhatsApp and Facebook with potential customers or buyers.
While registering with Meesho, resellers also link their Facebook or Instagram business page with the platform. Meesho will automatically create an online store for the reseller after successful registration.
Buyers can log on to the Meesho app and discover catalogues posted by resellers and place orders within the app. Resellers also have an option to share URL links to their online store via WhatsApp, Facebook or Instagram and initiate a chat with the customer anytime.
The company claims to have more than 50,000 resellers and over 1,000 suppliers that are currently live on the platform. For every transaction, a reseller makes around a 10-20% commission. Meesho has tie-ups with payment gateways to process payments.
The start-up was co-founded by Vidit Aatrey and Sanjeev Barnwal in 2015. It had raised $3.1 million in a round led by SAIF Partners, Y Combinator and Venture Highway in October last year. It also raised an undisclosed amount of funding from multiple angel investors in August 2016.
Aatrey refused to comment for the story.
Apart from online sales of products, Meesho also provides resellers with a customer relations management (CRM) feature to drive sales growth. Every time a customer visits an online store, the reseller gets a notification. The ability to chat with a potential customer gives some room for bargaining to the buyer, which is normally not possible on marketplaces like Shopify.
Meesho’s business model is largely built around small and medium businesses, and most of the sales are processed within a trust network or repeat buyers. The ability to chat helps resellers identify trusted buyers within their network, even though the buyer and seller may not have interacted before.
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