The Perpule Founding Team in their early days
Seed to Series A with the NextGen O2O play out of India
In today’s world, queues have become an unavoidable irritant for most offline transactions, be it shopping in the supermarket or depositing cash in banks. In fact, we have become so accustomed to queues that one is delighted to find the checkout counter empty, especially on weekends in supermarkets. But as technology penetrates every part of our lives & shoppers become more tech savvy, there is an expectation that retailers will provide better shopping experiences in the future.
Accounting for over 10% of the country’s GDP, India’s dynamic and fast-growing Retail Industry is already the world’s fifth largest destination and prominent brands are moving towards omni-channel retailing. The industry is projected to grow to $1.1T in 2020 at a CAGR of 20 percent, according to a report by Retailers Association of India. The modern retail industry, in turn, is currently at a market size of $12B and is likely to double to $24B by 2019, driven majorly by omni-channel retailing, according to Bloomberg. The number of supermarkets has grown over 30 times from 2006, with new growth coming from Tier II and Tier III cities. By some estimates there are as many as 15,000 supermarkets, 3,000 hypermarkets and a further 20,000 apparel shops in India.
When the Kstart team met the Perpule team in early 2017, we were drawn to their mission to democratize the commerce market and struck by their deep understanding of the Indian retail sector. Their approach to modernize offline shopping was truly innovative. The solution gave control of the experience back to the customers by creating self-checkouts and self-ordering solutions for supermarkets to food outlets.
While solving a key pain point for the customers, Perpule also aimed to create value for retailers by enabling them to combine online and offline channels in a holistic fashion with 1. Product and Offers discovery and 2. Online purchase from within the store. Perpule’s data driven approach would help analyze customers’ purchasing habits, store visiting patterns, and basket sizes to customize product offerings and create effective marketing campaigns even in an offline store.
Importantly, the team, led by the 3 entrepreneurs was dedicated to build products that touched people’s lives regularly. Together, Abhinav, with experience in business development, Yogesh, with a keen eye for operations, and Saketh, the programmer with an eye for detail, formed the ideal combination. What was more enamoring was the unending focus on the customer and solving for their user experience in stores, while challenging status quo and having the determination to go the extra mile to achieve the same. One of the other insights we had early on was their ability to take feedback and improve their model while focusing on the right metrics.
This resulted in the team @ Kstart backing the company for the first institutional round of funding with participation from Venture Highway and Raghunandan G, Co-founder of TaxiForSure.
The team has since come a long way after beginning with a simple pilot in Hypercity — working tirelessly and constantly iterating for the market. Their singular focus has remained to create value for both the retailers and consumers. On one side, the team worked closely with retailer’s IT teams to figure out how to integrate with their existing systems faster or built the best back-end systems for large enterprises and on the other, solved for pilferage and data analytics that created significant value. This has enabled this customer friendly platform to get validated across most of the large retailers in the country today.
Their latest innovation, Perpule’s Store-As-A-Service platform, with no checkout counters, has enabled a Hypercity store, one of their first customers, to increase their revenue three-fold. The store has agile shelves and no IT opex or capex and achieved profitability in their 3rd month with 80% customers checking out by themselves. With this renovation to shopping, they were able to achieve their vision of bringing the online shopping experience to an offline environment.
Today, over 500K customers are using the Perpule app, available on Android and iOS. Perpule has partnered with over 15 retail brands, such as Big Bazaar, Vishal Mega Mart, SPAR, More, HyperCITY, Heritage, Foodhall, Brand Factory, and QSRs such as Pizza Hut and KFC. It is the phenomenal drive and focus of the founders and the team to get such marquee clients to adopt a brand new solution. This customer centricity has also led to innovative concepts like the Perpule Digital Cafeteria Solution for Quick Service Restaurants (QSRs) which include cafeterias and food courts in corporate tech parks and malls and is currently being used by 20+ companies including the likes of Infosys.
Startups like Perpule are going after pain points faced by the population and turning them into opportunities. They innovate for the market and challenge the status quo. At Kstart, we believe that technology is instrumental in reshaping the way businesses engage with customers, in this case, by improving their shopping experience and increasing engagement through a personal touch point.
The founders’ vision, drive, execution and customer centric approach has today led to their $4.7 Million Series A round by Prime Venture Partners & Kalaari Capital with participation from Venture Highway. We are elated to be working with a larger team in the quest to create a large O2O play out of India in the near future. We are happy to see the growth the company has achieved since our investment and are thrilled to continue being a part of Perpule’s story as they scale and expand pan-India. We wish Abhinav, Saketh, Yogesh, and the team continued success!
Acknowledging the contributions of Karteek P, Fellow @ Kstart for being a part of the journey and Nanditha N & Milind B Fellows @ Kstart, for helping articulate our thoughts on the same