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Fynding the path for online and offline sales | Harsh Shah @ Fynd
123 Plays4 years ago
As an IIT Bombay graduate in metallurgical engineering and materials science, trying to figure out his way through life, he was not really sure what he wanted to choose as his field of work per se. A problem-solver, Harsh Shah is always thriving and striving to make an impact. In this episode, he shares with us personal and professional experiences he encountered during his quest.
Starting Fynd and building it through thick and thin, he takes us back to the process of it, sharing profound insights on how he garnered his way to a successful e-commerce business.
He is committed to building a seamless consumer experience and revolutionising retail-tech.
Let’s hear him speak about anything and everything from taking the business live to building strong collaborations, a hyper local presence, building a quality catalog, scaling up, and much more on how the e-commerce model works.
Key Insights:
- Creating customer engagement
- Analysing consumer behaviour
- Creating seamless shopping experience
- Raising funds for a retail-tech business
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Transcript
Introduction to Founder Thesis Podcast
00:00:02
Speaker
H.T. Smartcast You are listening to an H.T. Smartcast original
00:00:24
Speaker
Hi, I'm Akshay. Hi, this is Aurob. And you are listening to the Founder Thesis Podcast. We meet some of the most celebrated sort of founders in the country. And we want to learn how to build a unicorn.
Harsh's Initial Experiences in Retail
00:00:39
Speaker
So this is August 2012. Farooq and I are walking into this wedding couture store. And we're super stressed out because
00:00:53
Speaker
I think this is not a category that we've looked at. I think these go for 3-4 lakh rupees a piece. And we're just sort of out of our depth, right, when we're talking to these guys. So a couple of stores that happened, we said, you know what, this is not really working out. We'll probably figure out our pitch better and then come back. And then it starts raining and we can't find an auto. And this is August Bombay Monsoons. And there's this one diesel store.
00:01:21
Speaker
where we said you know what let's just run into the store we we knew of diesel as a brand we didn't know of the actual brand diesel and how expensive it was but you know we think this you know fashion street you know diesel products and we say everyone wearing diesel is that they are thinking why is this a brand now so let's just you know get in there we won't be out of our depth there we'll wait till the rain subside and then when we once we get an auto we'll then go so we sort of you know
00:01:46
Speaker
going to diesel and we're trying to act as though we are trying to shop. And the first pair of denims we see is like 15,000 bucks.
Background and Early Ventures
00:01:54
Speaker
Hey guys, my name is Harsh Shah. I'm one of the co-founders of Find.
00:02:03
Speaker
born and brought up in a Gujarati entrepreneurial family, Harsha knew engineering was his calling. And as an accomplished student, IIT was a cake walk. But the one thing that IIT gave him was the business buck through the entrepreneurial cell and while most IITians get a great placement offer, Harsha also ended up with a start-up when on campus.
00:02:29
Speaker
He eventually co-founded FIND, a unique fashion e-commerce portal which brings the latest in-store fashion online. Here is Harsh in conversation with Takshadat talking about his amazing journey from startup to being acquired by Reliance. Born in Bombay, brought up in Bombay. I think there was just a two-year gap that I was not staying in Bombay.
00:03:01
Speaker
I spent about a year and a half in Delhi and about half a year in New York, but otherwise the rest sort of 30 years of my life have always been in Bombay. Okay. So you got into IIT Bombay. How did life change after that? Did you stay on campus or you continued to stay with family? So, you know, I think life changed significantly. I mean, after IIT, I think as a person, I'm a very different person today.
00:03:30
Speaker
And honestly, I would be a very different person had I not been to an IIT as well. You know, I think IIT Bombay never had the option of sort of staying at home. I mean, you could always choose to stay at home, but you still have to pay the hostel fees. You would still have a room in the hostel. So, you know, of course, like everyone, you know, we paid the hostel fees and we said, I think Monday to Friday I'll be here, weekends I'll be at home and so on and so forth.
00:03:54
Speaker
So and there was primarily more for washing the clothes and doing laundry and things like that, more than anything else. So it's in the first year, I pretty much came home three weekends a month. In the second year, it went down to two weekends a month. The third year, it went down to one weekend a month. In the fourth year, I think I hardly came home probably once a month. So I think as you get deeper and deeper within
00:04:20
Speaker
within hostel life, student organizations and so on and so forth. I mean, I think you're less fired about laundry more than anything else, right? So how did you evolve in those four years? So, you know, I think I think first year, firstly, I was actually very, very lucky that, you know, having having the crop of seniors that we had, you know, in particular, there were about these four or five seniors whom I was very, very close to. And and
00:04:48
Speaker
The idea was that this campus life and especially IIT, this is true for almost all residential campuses across the country, is that the kind of opportunities that you would have to explore yourself and your interests will be very difficult to do outside of these campuses.
Life at IIT Bombay
00:05:10
Speaker
So I think the first couple of semesters was, you know, me trying to do everything, right? So everything from sports to debating to, you know, to quizzing, dramatics.
00:05:23
Speaker
I wish I would have spent more time studying, but, you know, everything I did in the first year. And that definitely... Were you, like, articulate and outgoing even before joining IIT? Like, you know, to do stuff like debating, you know? I was, I think. Even in school, I was a school head boy. I was part of the quizzing team. I was part of the debating team. I was part of the cricket team in school. We reached the district level as well. So I think I was always an extrovert and an outgoing person. I was always someone
00:05:53
Speaker
for whom academics was just one part of my daily routine. I would have cricket practice probably what I think four times a week for the last eight years, ever since I was in maybe second standard to 10th standard. You were pretty human driven. How did that come into you?
00:06:17
Speaker
like in your DNA to be achievement driven, like, you know, to do so much stuff in school is there's like, you know, maybe one one or two percent of people in school do so much stuff. So, you know, I think I think I would probably just again, you know, it's all good luck and, you know, thanks to my parents, I guess. I mean, you know, I think it was good luck that, you know, I was in a good school which had these sort of activities that, you know, you could take part in. Of course, you know, big, big, big thanks to my parents to ensure that
00:06:47
Speaker
I took part in everything, I was exposed to those things and allowing me to actually even pursue that. I remember that I was also part of this speech and drama certification program run by the Trinity College of London that happens
00:07:06
Speaker
And, you know, every year you have these exams that you give in speech and drama or in, you know, group communication and so on and so forth. And I was part of that as well, you know, again, between like third standard and sort of eighth standard. I did gymnastics till I was in my fourth standard, won a couple of gold medals at the city level as well there. So I think, I think it was essentially just, you know, you know, here's something that you should try out. If you're good at it, great. If you're not good at it, no worries. If you want to continue with it, no worries, right?
00:07:34
Speaker
I think it was something like that. So this achievement orientation continued through the four years at IIT, like what was it like the major? Yeah. So I think it was achievement orientation. I think it was more to do with, you know, doing different things rather than just one thing to focus on. Right. So I never did it to win or to come first, second or third. I did it because I thought that, you know, it was cool to do it or, you know, I had fun doing it.
00:08:00
Speaker
So it wasn't to do with, you know, hey, you know what, if you do this, you'll come first, you'll win, you'll win a gold medal, you'll win this. It was nothing of that sort. I mean, even today, I spend at least like five, six hours a week playing like season ball cricket and doing net practice even today. And it's because, I mean, there's no sort of tournament or anything, but it's just something that I enjoyed doing. I think the four years,
00:08:21
Speaker
I think, like I said, my first couple of semesters were actually pretty horrible when it came to academics. I mean, in the IIT system, my first semester was like a 6.34 on 10. My second semester was like a 6.9 on 10 and whatnot. But I think apart from sort of pulling that back up and graduating with an 8.2,
00:08:44
Speaker
I think a few things which I did in IIT, I was the debating secretary of the hostel. I was fairly active in the literary arts scene. So things like quizzing, something
00:08:58
Speaker
that we call pot puree in IIT. I think I was pretty involved in that. I was part of the freshman cricket team. I was part of my hostel cricket team. I was actually fairly involved, at least in the first couple of years with both Mood Indigo, which is the cultural festival of IIT Bombay, as well as the entrepreneurship cell.
00:09:18
Speaker
And actually, in my third year, I was part of the co-team of the ESL. In my fourth year, I was the head of the ESL.
Internship and Nova Global
00:09:25
Speaker
I had a startup on campus as well. So, I mean, it was a mix of... Hold on, hold on. You had a startup on campus. Like, tell me about that. Yeah. So, you know, I think, again, luckily, because I was sort of so involved with the ESL on campus, I think
00:09:41
Speaker
I think I was definitely drawn to the aspect of entrepreneurship and I think coming from a business family, I think I definitely took like a fish to water, the idea of just taking, building something of your own and so on and so forth.
00:09:58
Speaker
Right from year one to three, I was actually very involved with the ESL. Year four also, I was actually the head of the ESL on campus. And this is the biggest ESL in the country. I mean, we had a budget of about 70 lakh on a year to do events and competitions and so on and so forth. So after my third year, every student in IIT, at least in my time, were expected to do an internship in the summer between the third and the fourth year.
00:10:25
Speaker
And, you know, funnily enough, I got an internship at an accelerator in Sweden, in Stockholm. And this accelerator essentially had got together about 24 students from across the world. So I was the only one from India. There were two students from Taiwan, about three from Singapore, two from China, one from Brazil, two from Mexico, two from the US, and so on and so forth. Like, I mean, one from Iran, one from Israel and whatnot.
00:10:55
Speaker
So we were essentially a group of 24 students. And this is across engineering, liberal arts, MBA colleges across the world. And the 24 of us were actually
00:11:06
Speaker
put into this two-month accelerator, we were given multiple ideas to work on. At the end of the two-month program, we essentially had a demo day to the accelerator organization. They picked about six of us to say, we like what you're doing. Why don't the six of you guys come together as a team and start this company and we'll fund you.
00:11:31
Speaker
So I mean, they funded us, they took some 60, 70% stake in the company. What was the plan? What was the business that you proposed? So it was actually called Nova Global. The idea was that, mind you, this is 2009. This is the summer of 2009. And I think LinkedIn is just getting launched in a mass way across the world.
00:11:56
Speaker
when LinkedIn was actually quite abused by a lot of people, right? I mean, early on. So what we tried creating was some sort of a buy invite only LinkedIn, but only for students. And while we definitely provide you a social network to connect with each other and whatnot, we also sort of allowed some of these very, very high profile or sort of hard to get
00:12:23
Speaker
jobs that were sort of posted only on this network. So for example, I remember, again, 2009, we'd got a couple of roles, which was part of the chief of staff of Richard Branson. And, you know, I mean, essentially, a bunch of these, you know, entrepreneur in residence or chief of staff roles, but also creating this network of, you know, by invite only students and young working professionals to be part of this network.
00:12:49
Speaker
So we went ahead and we started that company. There were about six of us. I think five of them were doing full-time because they graduated. So they were running this out of Philadelphia in the US. I was running it out of my dorm room in IIT. So yeah, that was quite an experience. In my fourth year, I had my BTEC thesis. I was the head of the ESale. And I was running this company as well.
00:13:19
Speaker
Why didn't you just continue to run that company like I wish I could but but what ended up happening is that in the month of so I did sit for placements I I got a job, but I didn't you know really really I wasn't gonna I wasn't gonna join the job I was gonna continue with this company only in about I think March 2019 so March sorry March 2010 so I got placements in December 2009 and
00:13:46
Speaker
March 2010 is when my term is about to end and this company got acquired. So I think one of the portfolio companies of the same accelerator
00:13:58
Speaker
ended up acquiring us. I think some of the other six people didn't want to really continue with it full time. I was very clear that, you know, I don't want to continue working on it from home.
Opera and Meeting Faruk
00:14:09
Speaker
I don't want to start my career, you know, in an organization where I'm the only one working, you know, from an office, so remotely. And so, I mean, I was fine that, you know what, hey, you know what, you know, get me to Philly and I'll, you know, work in the office with others, and that's fine. But I'm going to be sitting in Bombay and, you know, working alone at the start of my career.
00:14:28
Speaker
So I think overall, then, you know, this particular company agreed to sort of, you know, acquire us. And he said, you know, this is great. I think it's a good end to it. I think all of us were sort of accidentally into it. I mean, it was part of this internship. Did you make money like in the acquisition? I didn't make money. Not a lot, though, but but but definitely, but definitely, definitely more than my first years of sort of a salary after I.D.
00:14:58
Speaker
So it was a good start, I would say. So this would have also given you like a major boost in your ability to build an organization. So, you know, finally enough, we didn't really build an organization because I was working remotely. So so organization building, not as much, but definitely things around, you know, product and go to market and, you know, partnerships and things like that definitely was helpful.
00:15:19
Speaker
Okay, okay. What traction had the product got? Like, and what was your role in it? Well, so I think I was looking at community building in Asia. I was looking at, you know, getting, getting brands and companies again, out of India, Singapore and China. And I was looking at, at, at, you know, product, product, I wouldn't say designer development, but sort of, you know, product via framing. I was looking at that. So, you know, that was my role. And I think
00:15:47
Speaker
And I think the reason is I was doing it while I was a student, while I had to do my thesis and whatnot, right? I think the other five were doing it full time. So, you know, they had much larger responsibility than I had, but it was a good experience. I think, I think, I think organization building experience, I would say, came more from ESL than this particular company. So, and ESL, you were managing that seven lakhs. You were like a P&L head. Yeah. 70 lakhs. 70 lakhs. Yeah. 70 lakhs. Yeah.
00:16:14
Speaker
I mean, I think our team did a good job at sort of, you know, getting this amount of sponsorship. I mean, of course, we were a team of 20 people, two of us in the fourth year, about 18 of them in their third year. And, you know, mind you, this is all sort of, you know, voluntary student organizations, right? So I think it was an interesting challenge. I enjoyed it. I mean, of course, I was too naive now that I sort of look back. I think we were more an event agency as opposed to an actually entrepreneurship cell.
00:16:44
Speaker
But I would say that, you know, that exposure was also very, very important for me. I mean, it was only through the ESL that I got connected to the VC community, that I got connected to, you know, even Sasha from K capital. My first interaction with him was because of, you know, me being in ESL and, you know, look how that worked out, right? I mean, so I would say it was an amazing experience, honestly. I mean, I think being a part of a student organization was just absolutely amazing.
00:17:12
Speaker
Okay. Okay. So you got placed in Opera that was from campus. That's right. That's right. So it was like a day one placement, day one slot two placement that I got that I got into Opera for. I mean, you know, I, you know, funnily enough, I actually got rejected by a company which came in slot one because they thought that, you know, I would not take up the job and I would just continue with my startup. So so they said, you know what, there's no point, you know, giving him an offer. He's he's going to reject it, you know, continue, you know, continue with this company.
00:17:41
Speaker
But actually, thankfully, Opera didn't have that one. And they actually gave me the offer, which I could take up after the acquisition. And how were those almost three years you spent there? So how were those three years? Yes, I actually spent full time two years and about part time for about eight, nine months. I would say, again, great. I think from a learning experience-wise,
00:18:10
Speaker
I think consulting is always great. You get exposed to so many different problems. You're put into a client-facing role right from probably month one or quarter one. You're looking at problems that you don't have any sort of technical capability on, but you're just trying to... So tell me a bit about what Oprah does first.
00:18:30
Speaker
So Opera, when I joined, was a mix of strategy as well as analytics consulting. We would work with some of the largest companies in the world, and this is predominantly in the US and UK, helping them with things like marketing analytics, organization strategy, risk analysis.
00:18:50
Speaker
risk analytics and so on and so forth. So, I mean, we would be working with banks and, you know, large financial services companies, large retailers, and whatnot, and, you know, working with their sort of senior leadership to help them figure out what they need to do better in their companies. So, of course, I was a junior member of the team, but you were still exposed to all the problems that we as a team are looking to solve for that client.
00:19:18
Speaker
Your role was like crunching the numbers and coming up with some sort of analysis. My first six, seven months was predominantly analysis and preparing presentations, structuring conversations and whatnot. But I think post the first six months, I was also in a very deep client facing role as well. So I was also presenting to the clients and presenting our findings, telling people what
00:19:47
Speaker
what changes we thought needed to be done, what we thought were the issues and what not. Why did you go part-time there? In hindsight, I would say that consulting was the best. I think two years we were doing this full-time. This was both me and Faruk. I met Faruk, my co-founder at Opera. Faruk was also a senior from IIT Bombay. He was one who recruited us. He was actually part of the recruiting team from Opera that came on campus.
00:20:15
Speaker
Farooq was, of course, two years senior to me. But I think both of us were in opera with the mindset that, hey, you know what? We do want to start something of our own in life. It's just that we haven't figured out the right idea or the right team to actually do this right now. So I think there's two years while we were working.
00:20:36
Speaker
Uh, in opera, you will also, uh, you know, very, very closely discussing different, different ideas, um, different problems that we want to solve and whatnot. And no, that's where, that's where really, I think the genesis of our entrepreneurship journey, you know, uh, uh,
00:20:51
Speaker
came together. So till about 2012, we worked full time on it. And then both of us had figured out, OK, now this is the idea that we want to really, really dig deeper into.
Pivoting to Retail Tech
00:21:04
Speaker
And we went to Opera and said, hey, you know what? We were actually quitting because we're going to start our own company. And then Opera, bless their souls, came back and said, hey, you know what? It's fine. We definitely want to support you to start your company. We're not going to stop you from doing that. But I'm sure that at the start,
00:21:21
Speaker
You probably won't be doing everything full time because you don't have a product yet. You're still thinking about the problem. So why don't you guys still help us out 25% of the time? We'll pay you 25% of your salary, which will always be helpful to you as you start off. And if you feel that now your company is going somewhere at that time, you can leave completely. So I think it was great that Opera gave us that particular parachute per se.
00:21:51
Speaker
So we helped them out for about nine months. We were sort of involved in a couple of client development work. When you told them we are quitting, you had an idea in mind that what do you want to do? Yes, we did. Yes, we did. We were actually working on an idea in the electronic health record space. What was that idea and then what happened to it? Yeah, so the idea was that I think healthcare data, which is a mix of diagnostics, prescription,
00:22:19
Speaker
as well as both an inpatient and an outpatient scenario is not stored anywhere for the patient to get access to. Hospitals have that when you're in the hospital, doctors give you their file if it's a chronic condition and whatnot, but there's no central place
00:22:39
Speaker
where you've sort of digitized all your healthcare data. So that was the idea was to actually create this central repository of health data on you and your family members, which would be everything from diagnostic tests that you've done, doctor visits, doctor prescriptions, doctor notes, inpatient care, all of those things. Which is what PRACTO also started with.
00:23:02
Speaker
Which is what practical just started doing that's right. That's right. That's right So so practice started doing that I think you know two and a half months into that we realized that I don't think the Indian sort of health care services Industry is ready to actually share this data I mean there's a lot of sort of you know cash billing that still happens in diagnostic centers and for doctors and they don't really want to digitize everything and
00:23:25
Speaker
and so forth, which is also one of the reasons why even till today, which is almost eight years after that idea, we don't find a single EHR platform. So I'm glad that we sort of moved on from that. It was probably ahead of its time. And even Practo went more into appointment scheduling than actually a proper EHR person. So we realized within the first two months that, hey, this doesn't work.
00:23:54
Speaker
Um, we let's think of something else. And, uh, and, and, you know, this again goes back to the opera story. So opera, uh, every year had had this competition called the opera open where anyone in the company could actually present ideas. Uh, and you know, they would have a proper demo day and, you know, the top three would get cash prizes and whatnot. So, so far, can I sort of put some, I think, uh, I think four or five different ideas we would have put in 2009 in this opera open.
00:24:23
Speaker
And I think two of them got selected in the semi-finals. One of them went to the finals, and we ended up winning some, I think, 10 lakh rupees as part of our prize money. But of course, because it's the opera open, the IP belonging to opera, which is fine, because they're giving the prize money, the other employee, and whatnot.
00:24:43
Speaker
So we quit, we do this healthcare thing, doesn't really work out, and then Opera says, hey, you know what, we're not gonna do anything with your idea, so you know what, take the IP, it's not ours anymore, it's back to you guys. And then we met the senior of ours who actually runs the Avanti centers, right?
00:25:01
Speaker
We meet him for lunch and he says, you know what guys, you have this already idea that you presented in Opera. You now have the IP of it as well. Why don't you just go and try that out? And that idea was in the retail analytics space. It was about how technology can play a role in the physical retail space, right? So this is again 2010, e-commerce is booming, but in the brick and mortar retail stores, there's actually no technology whatsoever there.
00:25:28
Speaker
So Akshay is like, hey, you have this idea. Why don't you just walk into some stores and talk to them and find out if that works? You're brilliant. You already have this idea. Just try that out. So we then abandoned this sort of healthcare idea and we said, you know what? Let's just walk into a few stores. Let's talk to the store owners or the store managers and let's see how it goes from there.
00:25:48
Speaker
And that's how we moved away from the EHR idea onto the retail tech idea. So tell me more about the retail tech idea. What exactly did you think of as the product? So the genesis of it happened that I think in the physical retail environment, you pretty much have just one source of truth, which is the sales data. But even that is more a post-hoc data of what the shopping journey has been.
00:26:17
Speaker
That data has captured the end of your shopping journey. So we realized that there were not too many streams of data in the physical retail environment, which allow us to understand how a shopping journey is going on. So I would say the kind of analogy in the online world would be things like bounce rate, dwell time, product display page reviews, and add-to-carts, and abandoned carts, and things like that. Now, all this data was not present in the offline world.
00:26:45
Speaker
So we said, how do we start creating this data? So we said there were two ways to do it. There is, of course, use CCTV cameras to actually look at what people are doing. But but again, this is 2010 and computer vision algorithms or models are not are not are not as good at that time.
00:27:03
Speaker
The other was that, hey, you know what? Why can't we engage a consumer while the consumer shopping? So when you're walking into a store, the store doesn't have much tech. So as a shopper, you're pretty much just sort of ambling around, asking a few questions, trying out a few products. But can you create an engagement screen in the store where the consumers can do at least, say, 50% of the shopping journey on that screen?
00:27:32
Speaker
And then because they're doing that on a digital platform, that creates a sort of data. Yeah. So that creates the data stream that we need to understand pre-purchase shopping behavior.
00:27:47
Speaker
So we sort of created mock-ups on an iPad. And we did everything from virtual trials and whatnot. And it was very, very hard-coded. You could only do it for the top 20 products of the store and whatnot in terms of virtual trial. Otherwise, it's like a catalog that you're going through. You were only looking at fashion retail as your? We were only looking at fashion retail. That's true. And I think the reason is because
00:28:17
Speaker
I think fashion retail, I think fashion, or I would say non-grocery or non-electronics, but a category which were fairly commoditized, I mean, grocery and electronics were actually fairly commoditized. In fashion, you had a lot of influence over the purchase behavior or the purchase decision during the shopping journey as well.
00:28:40
Speaker
So we said that the largest impact to this data will be in fashion. And I would also say that the reason is I think Kirana predominantly happened through Home and Pop stores and not through these organized retail outlets. And I think electronics was, again, I would say predominantly a user doing research on his or her own before coming into the store, right? So that's why we looked at fashion as the category to actually target in this.
00:29:11
Speaker
So what happened to this? Did you actually build it out and like, you know, launch it or?
Building ShopSense
00:29:18
Speaker
Yeah, so so so we actually built a mock up for this for the opera competition in which we came second. We got the People's Choice Award and whatnot. So we had one mock up ready. And we then took this iPad and started embling into stores in Bombay to talk to their sort of store managers, associates, owners.
00:29:40
Speaker
And this, and you know, I stay in Santa Cruz, West in Bombay. Farook at that time stayed in Lokhandwala. So I think, you know, our senior said, hey, you know what? There's so many of these designer stores on Jhutara Road. Why don't you just walk in there, right? You'll get the owner there, also speak to the owner. So this is August 2012. Farook and I are sort of walking into this, you know, wedding couture store.
00:30:09
Speaker
And we're super stressed out because I think this is not a category that we've looked at. I think these go for three, four lakh rupees a piece. And we're just out of our depth when we're talking to these guys. So a couple of stores that happened, we said, you know what? This is not really working out. We'll probably figure out our pitch better and then come back. And then it starts raining. And we can't find an auto. And this is August Bombay monsoons.
00:30:38
Speaker
And there's this one diesel store where we said, you know what, let's just run into the store. We knew of diesel as a brand. We didn't know of the actual brand diesel and how expensive it was. But you know, we'd seen this, you know, fashion street, you know, diesel products. And we saw everyone wearing diesel. So let's just, you know, get in there. We won't be out of our depth there. We'll wait till the rain subside. And then when we once we get an auto, we'll then go. So we sort of, you know,
00:31:05
Speaker
going to diesel and we're trying to act as though we are trying to shop. And the first pair of denims we see is like 15,000 bucks. Like, you know, shit, this is too much. Let's just go to some other place. Let's look at some t-shirts. So we go to a t-shirt and it is, again, 8,000 bucks. And we're like, okay, I'll take care. Let's just act and then find our way out once the rain stops.
00:31:29
Speaker
So we're acting there, and then this one person comes and says, hey, guys, do you need help? Are you looking at something specific? Can I help you in something? And we said that, yeah, sure, we're trying to look at these things. And then we start talking to him, and we realize that he's actually the marketing manager for Diesel, who's on his weekly rounders to that store.
00:31:52
Speaker
So, you know, once the ice is broken, we tell him, Hey, you know what, by the way, with these two guys, we have this idea in retail tech, we're doing research about, about, about the fashion market in itself. That's why we thought we'll come in here and we show him the iPad because we anyways for carrying that mockup. And he said, Hey, you know what, this is actually pretty cool.
00:32:11
Speaker
I think someone like Diesel could be interested in trying out something like this. If you can wait for about half an hour, I have my head of customer experience who's actually coming to this store. Because one more thing about this store is that they actually have a jamming studio in the basement of the store. So this head of customer engagement is coming with his band to jam in about half an hour. So if you guys can stick around once he comes, we can show this to him.
00:32:36
Speaker
We said, OK, cool. We'll wait around. And then, you know, in that half an hour, he was taking us through the history of diesel and, you know, what kind of products are there. And then this sort of head of customer experience comes in and we show this to him. And he said, you know, this is actually pretty cool. Why don't you why don't you develop a mock up for diesel specifically and present it to our brand head whenever you're ready? Right. I mean, no stress. We have no such issues whatsoever. You just come and present it whenever you're ready. So we said, OK.
00:33:04
Speaker
We need something, we need to design this, so we need to design it on board. So that evening I go to Behance, I put a filter of graphic design and illustrations, and I put a filter of Bombay, and I sought for the popularity high to low. And the first three names on that, I look at those three names in Bombay, go back and then message them on LinkedIn.
00:33:30
Speaker
saying that, hey, you know what, I am so-and-so, we're working on so-and-so, I'd like to meet you. And the first guy is actually Sriram and he replies and says that, hey, you know what, let's meet at the CCD inside tomorrow afternoon at whatever 4pm. So then I go to that meeting, Sriram sitting there with a book in his hand waiting for me to come, and then he gets started
00:33:51
Speaker
And we start talking and I tell him, you know what, with these two ideas that we're working on, this is electronic health record idea. There's also this, you know, sort of this diesel thing that we have to sort of design up. So we'd love for you to sort of, you know, design any of these, which you think you may be interested in.
00:34:05
Speaker
So then Shiram comes back and says, hey, you know what? I don't really like the health records idea too much, but I'll help you guys out with designing this thing for diesel. Give me a couple of weeks and you know what? I'll design. And Shiram at that time was doing his master's in interaction design at IDC at IIT Bombay. But he said, hey, you know what? I'll still find time to do this. So then he takes about 10 days. He creates a mock-up of what this looks like for diesel.
00:34:32
Speaker
And then he sent it to us and we said, you know what, that's great. We'll go present it to the brand head of diesel. So, so we set up a meeting with Reliance Brands, which actually is the master franchisee of diesel in India. And we meet this guy called Deval, and we showed this mock-up to him on the iPad. And, and he's like, you know what, I think you guys are smart. I mean, you know, and, and funny enough, Deval also had his tech startup, you know, back in Ahmedabad before he joined Reliance Brands.
00:34:58
Speaker
So he's like, you know, I think you guys are onto something, but I don't like what you've done so far. Um, but I like you guys. Why don't you guys take, take again, more time as much as you need and come up with something, something bigger and something which is, which is sort of more impactful was his, was his sort of feedback. So we again go back, you know, we tell him, okay, give us a week. We'll come back to you within a week.
00:35:22
Speaker
And then we go back, you know, Shirdaman Farooq and I are sort of thinking and saying, Hey, what do we do? What do we do? A week goes by and there's nothing much that we do. I mean, it's only incremental changes, right? I mean, um, so one, one night before, I didn't know whose idea was it, but you know, I think, um,
00:35:39
Speaker
I think the three of us decided that, hey, you know what? Rather than taking it on an iPad, let's just print these designs out on an A2 sheet, rather than an A4 sheet. Let's print this out on an A2 sheet, which is essentially the size of a 32-inch TV. And let's present that to them. So literally, he said, barakar kyao, tohamne bare paper de print kyao. And we actually go there. And he loves it. And he says, all right, this is brilliant. I want you guys to build this for me.
00:36:09
Speaker
Again, take how much of a time you want, but build this for diesel. I will give you prime location in Palladium on the ground floor. We'll put this for three months and we'll see how it goes. So this would be like a display where people could do virtual try-ons. This would be a touchscreen display where people could do virtual try-ons. They could check out the catalog. They could see what's in stock, what's not in stock. They could see which other store has that product. They could share it.
00:36:36
Speaker
on WhatsApp, on email, with their friends. They could do searching, filtering, all of those sort of things. So that's what happened. So this was September 2012. Diesel said, hey, you know what? Whenever you guys are ready, show this to us. And then we can go back, contact a few of our juniors who can do this coding for us. We say, hey, you know what? We guys have a project for you. Let's just spend how much it takes to actually do this.
00:37:06
Speaker
And then we do this, we go live in the diesel store in mid-December 2012 is when we go live in this diesel store. And for that month,
00:37:19
Speaker
I think all three of us, Farooq, myself, and Shiram, we are sort of these pseudo sales associates in the diesel store for three months, trying to see how consumers are using it. And diesel likes it, right? I mean, diesel likes what we've done, but we can't sort of figure out the commercials to work out on it. But while that's happening, we said this is something that's good that we've got, that we've come across. Let's go raise a round of funding. Let's start a company in this consumer engagement space for retail tech.
00:37:50
Speaker
And that's how, that's how, you know, at that time it was called ad sale and then shop sense. That's how it started. Okay. So whom did you raise funding from? You used your IIT e-sale contacts for that. Yes. So, so, so there were two sets of, actually, there were three sets of, you know, investors that we, that we use, right? So one is seniors from IIT.
00:38:10
Speaker
So this is the whole gang of, you know, Zishan Hayat of Topper, Abhishek Jain, and Anil Ghelra of, you know, Hola Chef and our Snap Mint, and a bunch of these, you know, guys who sort of sexy enough, you know, Hola Chef. So I think all of these guys who have started companies, and you know, they will put anywhere between one lakh to two lakh rupees in your company. So that's sort of one group of investors. The second group of investors are actually our partners at Opera, right? So people who we used to work with at Opera,
00:38:39
Speaker
There are about four of them who said, we'll put about 7, 7, 10, 10 lakhs each. In our company, we like you. We've worked with you in the past, so we know you guys. That's the second group. The third group is essentially Sasha, whom I've interacted with through my time at ESL. Sasha takes one look at us and says, hey, Harsh, you're starting something. Great. Let me know how much I can put in.
00:39:02
Speaker
So there is three group of people in February 2013 that sort of cobbled together a 1.2 crore round. And we sort of close the documents and the money comes in the bank by April. And then we go to the line and we go to the opera and hey, you know what, now we're doing this full time. So thanks for your help.
00:39:24
Speaker
but now we're going to start this company off. Okay. Okay. So then what happened after that? Like, you know, obviously you pivoted, but why did the pivot happen? So, um, so, so 2013, uh, uh, April is when we, is when he sort of raised around the funding, we started building the team. Um, and we then started selling this in store consumer engagement device, uh, product to any and, and, and every detailer we could get a hands on.
00:39:53
Speaker
I think what was supremely important is that our pilot product was on display on the ground floor of Palladium Mall in Bombay for a good three months. Every major brand in the country would have seen that. Every CEO of every major brand in the country has seen that and has used it. Because we were standing there for three months straight, we've now spoken to them.
00:40:16
Speaker
And everyone is aware of what e-commerce is doing. And everyone's very excited at seeing technology in stores in the retail environment. And they all want to talk to us. So we started these conversations. We signed up with Being Human, who gave us our first break.
00:40:35
Speaker
In this, again, there Manish Mandhana at that time, who ran Being Human, was like supremely excited. He was like completely bought in and said, hey, you know what, whatever you guys need, we met Salman Khan. We actually demoed this product to Salman Khan and said that, hey, you know what, this is going to be like this. And the added feature in the Being Human device was that the virtual trial trying, you can actually do it on Salman Khan. So you can change Salman's shirts and pants and whatnot.
00:41:00
Speaker
So being human, then Nike, and then US Polar Association, and Arrow, and Flying Machine. And we got all these clients on board. We got a few clients in Dubai. We got one client in London. And we're starting to do this.
00:41:15
Speaker
In between, we raise a couple more bridge rounds because it's not really scaling them up as much as we expected it to. This was a proper software as a service model. We take 10,000 rupees per installation per month, but we charge them 10,000, but that doesn't mean that everyone pays on time. There were cashflow issues. I think there was definitely pushback. Everyone will keep coming back every month and say, hey, not 10,000, 9,000, 8,000, 7,000.
00:41:46
Speaker
And then it just became a way in which anyone would use us as an agency and say, hey, I want to build this for me, build this for me. And then we weren't really able to create a product or a platform out of that. We were essentially a sort of large screen app development agency. But we still ran that for about two and a half years. I mean, it worked out well. It was decently making money.
00:42:13
Speaker
But we weren't scaling up as much as we wanted to, honestly. A few things that we'd done right is, even on this device, you had to show consumers what catalog is available. So we would directly integrate into the inventory systems of these brands that will give us access to what's actually available and what's not available in the store right now.
00:42:37
Speaker
And that particular sort of technology that we would invest in is the most important thing that we've done at FIND over the last eight years. But this is about early 2015, where things are not really working out in the sense that, I mean, sure, we've got about 120 of stores in which this particular device is there, but not really scaling up as fast as we would want it to. I mean, we remember Nike was a client of ours at that time.
00:43:06
Speaker
And Nike started off with about five stores in the first month. And even after a year and a half, they were only scaled up to about, say, 40 out of the 600 stores that they had. So we were like, you know what? This is just, I mean, they had to invest in the device and in the, you know, all of those things within it. So we said, you know, this is not really working out.
00:43:29
Speaker
2015 was also the time where you had the hyper-local delivery companies come up. You had your road runners and you had your grovers and your tiny owls of the world who are now talking about hyper-local commerce. You're buying online, but it's coming from somewhere close to you. Grover's was actually one of the first companies that did that. Grover's is run by a friend of ours, again, a senior from IIT and a colleague from Opera as well.
00:43:59
Speaker
So, you know, we said, you know, hyper-local seems interesting. It's something that is, that seems to be picking up. And, you know, otherwise e-commerce is all done on a centralized sort of hub and spoke model. You have these large warehouses that Mintra has, and Jabong has, and Amazon has, and Flipkart has. But no one's really sort of, you know, picking up products from the store. And we did this sort of, you know, rough analysis, which kind of told us that at that time, there were about 20 million Indian consumers online. This is, again, early 2015. I mean, today the numbers,
00:44:28
Speaker
very different thanks to GEO. But at that time, 2015, 20 million Indian consumers were shopping online. And actually, we did this rough calculation which told us that 87% of this population actually stays within the four kilometer radius of a clothing store. So if that is the case, why are you shipping products from 400 kilometers away? So we said, hey,
00:44:54
Speaker
We work with most of these brands. We figured out a way to integrate into their inventory systems. Why can't we run the hyper-local e-commerce, fashion e-commerce company? And because it's hyper-local, I can actually give you something within sort of two or three hours. So we've actually, the forerunners of Amazon Prime, honestly, right? I mean, of course, Grofus was the forerunner for all of these things.
00:45:17
Speaker
Planning to build a Grover's for fashion, basically. We did.
Evolution to Find Store
00:45:20
Speaker
We did. We actually did build it. I mean, so so so we said, you know, let's build a Grover's for fashion. Let's build an Amazon Prime for fashion. Let's build a Swiggy for fashion. Whatever it is.
00:45:31
Speaker
So we will integrate into all the stores that are around you. You place an order. It'll come from the store close to you. So it'll get delivered to you within three, four hours. And also, by the way, hey, because it's coming so quickly, and if you want to return it, you can return it right then and there. So the store actually gets the product back within four, five hours. So you went to the stores and says, hey, you know what? Why don't you allow them to send two products? So rather than only sending a size M, all the size, send a size S as well to the customer.
00:46:01
Speaker
So the customer can actually try it, whatever fits them, they can keep it, and then the rest, they can send it back. And again, this was at a time where returns and RTOs, which is the case today also, was a big problem for fashion e-commerce companies. It still is today, but at that time, it was one of those big taboos for these e-commerce companies. So in a way, you were the first one to do the try and buy kind of a thing.
00:46:26
Speaker
That's right. We were the first ones to try to actually do try and buy anywhere actually in the world. So October 2015, we launched this service in Hawaii. So we did so we got two malls, which was our city guard copper. And we got
00:46:43
Speaker
Phoenix Market City, Kudla. And we said, you know, we will we will service everything from Sainte, Chambur, Kudla, Ghatkopar, Vidya-Vihar, Pabai and Mulund and Andheri East from this area. And then every week we would add more areas to this because we would activate more stores and so on and so forth. So we did this only Bombay hyper local thing from 2015 October till about
00:47:12
Speaker
May 2016. What was the traction like? We did about 300 orders a day. We would do an average order size of about 2000 rupees. I would say 40% of those orders were try and buy orders. About 90% of the orders you would deliver the same day. Even for someone who placed an order as late as 8pm also, right? I mean, imagine you face an order at 8pm and at 10 o'clock you're getting something at your house.
00:47:39
Speaker
So we were doing that very well. And then two things sort of happened, right? So one is the delivery partners, which is the likes of roadrunners and all, they all shut down because I think all of them were born to serve food category, which was at that time tiny owl and swiggy and whatnot. I think food just didn't have the absolute margins to support these delivery companies.
00:48:08
Speaker
So, you know, they shut down. And the second is, you know, consumers from all over the country came and told us, hey, you know what, even for the same brand, which we find on Mintra, you actually have better stuff than Mintra has. And that's when we realized that predominantly on these marketplaces, brands are selling old season merchandise as a way to liquidate the stock that has not sold in the store. Right.
00:48:33
Speaker
But what we were actually showing, we were showing fresh fashion directly from the store to the consumers. So consumers would come and tell us that, hey, you know what? I'm calling from Pune. I know you're not active in Pune, but I actually can't find these pair of Steve Madden shoes anywhere else on Mintra or Jabong. You guys are the only ones who have it. I don't mind waiting for three days, but you ship it to me to Pune. I don't mind paying you 50 rupees extra, but you ship it to me to Pune.
00:48:59
Speaker
So these two things happen and we said, Hey, you know what, if we can do that, sure, we will, we will stay true to the fact that we will always deliver from the stores, but let's deliver everywhere. Right. I mean, um, even if someone from Pune wants it, sure. Give it to them. They willing to wait for three days. That's okay. How does it matter? No. Um, so June 2016 is when we said, even though we will do hyper local, we will also do intercity as well. Right. Um, and then.
00:49:27
Speaker
And then we started just, you know, growing our footprint of stores that we fulfill from, from just Bombay to all over the country. So like today we fulfill from over 130 cities across the country and we've got access, real time access to inventory across some 10,000 stores in these cities to an extent where we're actually India's largest fashion supply. I mean, on a daily basis, there are about 45 million pieces of inventory that are synced to our system.
00:49:57
Speaker
This is the largest fashion supply that's there anywhere in the country. So 2016 is when we sort of opened the floodgates and we started sort of, you know, doing this, sending this, you know, consumers could shop, we'll come in, we'll always pick it up from a store close to them and we'll deliver to them. And so we use third party logistics to deliver. And then again, 2016, November, you know, the same day well from Reliance Brands again calls me.
00:50:26
Speaker
and says that, hey, you know what? I see what you're doing in the sense that you guys are sending stuff from the store. Why can't I do this for my stores as well? So the problem statement he told me of is that a consumer walks into my store today and anecdotally about 15% of the times the consumer actually doesn't find the right size or the color that they're looking for. And today we know that it's available in some of the store.
00:50:52
Speaker
We tell the consumer, hey, you know what? You come up after two days, or you go there and you pick it up. But I don't think anyone does that. I mean, only in absolute emergency cases will a consumer come back after two days and say, hey, you know what? Sure, I wanted this. You lose the consumer, basically. I lose the consumer, right? So he came and told me that, hey, what if we were to use your system
00:51:21
Speaker
where the store guy can place the order and it will get delivered from the next store directly to the consumer. The only caveat is that I want this only for my brand. So when the store associate is using it, he should only be able to see Steve Madden. He should not be able to see Nike also and Aldo and the other brands out there.
00:51:40
Speaker
So he said, okay, we'll create a special login for you on the find app and that login will be mapped only to one brand. That way you can just see one brand, right? Otherwise you can do anything else for everything from scratch and delivery prepaid. I mean, everything else works the same, right? As find.com is. So he said, okay, this works out well. So, you know, funny enough, we actually agreed on this the day after my wedding in November, 2016.
00:52:06
Speaker
Um, so they will attended my, my sort of wedding reception. And the next day we again got onto a call and he said, okay, sure. Let's just close this. Um, uh, and then in, in end of January, 2017, we launched something called find store, uh, in the Steve Madden stores in about 20 Steve Madden stores across the country. Right. Where, where, where you're essentially doing e-commerce transaction, but inside the store.
00:52:32
Speaker
So the order, instead of being originating at home of a consumer, is being originated at the store, but everything else is still the same. So within the first month, the numbers that we saw was absolutely astonishing. We were contributing about 9.5% of store sales through this in-store product. And that's a massive, massive amount. And for a business, think of it this way.
00:52:59
Speaker
We've done an e-commerce transaction without the customer acquisition cost completely. So we said, hey, this is an amazingly profitable business. We're doing decent amount of sales. Why don't we do this with other brands also? And how would you be charging? Like, would you charge as a percentage of sale price? As a percentage of transaction. Yes, absolutely.
00:53:24
Speaker
Because we said everything is the same, right? Sure. On fine.com, because we acquired the consumers, I will charge you 30% commission. But on fine store, because the consumer is walking into your store, but I still have all the other costs of the platform, server, logistics, customer support, all of that cost is still there. I'll charge you 20%. So I'll give you a 10% off in that, but I still charge you a commission on transaction. But that's profitable business.
00:53:54
Speaker
We said that find.com is what the consumer is shopping online. Find store is the product with the store shopping for the consumer. Jan 2017 is when we started Find Store. Funnily enough, if you actually think about this use case, it actually goes back to the same old shop sense use case that we had in being human and Nike and all. The only difference is that one, it's not customized. Two, we're not charging on a per month fee and then going behind retailers to give us a monthly fee.
00:54:24
Speaker
And three is that it's an online transaction that we are capturing the payment first, cutting a commission and then remitting the rest back to the retailer. So in effect, we solved the three issues that we faced with the shop sense business model in the fine store business model, which allowed us to get scale, which allowed us to not having to do a lot of these customizations and whatnot.
00:54:52
Speaker
So Jan 2017, we said, okay, along with find.com, we're also going to add, find, store as a separate product. So the backend remains the same, the operations remain the same, the logistics remain the same. It's just that the front use case is different. In March, you raised funding, a series A funding, I think in March and May. That's right. So how did that come out? Yeah.
00:55:15
Speaker
So I think when we were shifting from ShopSense to Find, which was in October 2015, we went back to our investors and said, hey, you know what? ShopSense as a business model is not really working, not really scaling up, and so on and so forth. But you're seeing all the hoopla around hyper-local. So we want to do that. So we want to pivot the company. But of course, we would need more capital because now it's a consumer play. So we will require a million dollars of capital.
00:55:45
Speaker
So we went back to the same investors. They were very, very supportive. They re-capped the company as well to sort of save on the dilution of the founders as we embark on this new journey. And we also got a few new investors added also to this, right? So Kunal Bell and Rohit Banselfa of Snapdeal also joined this round in sort of August, 2015, right? So Kcapital put in more money as well as Kunal and Rohit came in as well. And we sort of moved to fine.
00:56:15
Speaker
And then when this fine store thing also happened, we went out and raised another round of funding. This was led by IFL, where we said, hey, you know what? Now this is becoming more so a retail tech platform, but it still has the same dynamics of an e-commerce company. But there's this one business line which is definitely profitable and growing well. We want to sort of do both, which is the e-commerce as well as the fine store product as well.
00:56:45
Speaker
So IFL was like, you know what, as long as it makes money. So we go to IFL, we of course go to all the investors and then IFL says, you know what, this is interesting. I mean, we don't usually invest in such companies, but I like you guys. You guys are thinking of it the right way.
00:57:05
Speaker
So you know what, we'll put in money. And we also got a bunch of other co-investors as well. So we had rocket ship. We got Groex. We got venture catalysts. We got Artha Ventures. And everyone sort of, it became more of a sort of party round at that time. I mean, not in terms of valuation, but definitely in terms of the number of investors coming in. And we had about, I think, 85 investors on the cap table as of that round. Right?
00:57:34
Speaker
So that's when sort of the $1 million round happened in 2015 when we were pivoting. And then this $3 million round happened when we also introduced FindStore. So then this is Jan 2017. And we just discovered that this is new business line also. And we started growing that business line as well, very well. And then we grow that all through 2017.
00:58:03
Speaker
And then we come on to 2018 and one of our old clients, which is being human, who's been live on find as well as find store calls us and says that, Hey, you know what? Why don't we also integrate this into my website? So being human is just launching being human clothing.com or dot in or whatever. Um, and they said, Hey, why should I only run this through my warehouse? If you are able to run this on find.com, can you help me create the same linkages and you manage the backend for me, but on my website,
00:58:33
Speaker
where I want customers to order from stores, I want to deliver from my stores and whatnot. So we say, you know what, why not? Of course, it's your customer acquisition cost, my e-commerce margin I will still keep, but it's yet another different front end. Nothing changes for me on the back and whatsoever. So Shop will help you out. And we call that business OpenAPI brand websites.
00:58:58
Speaker
where now brands who want to run their own websites on the Find platform to take advantage of our omni-channel capability can also go ahead and do that. So being human in, I guess, August 2018 became the first brand to actually go live on this Find platform. And this would again be stored to consumer, like nowhere else. Stored to consumer. Absolutely. Absolutely. Right. So we started this conversation with being human in about, I think, Jan 2018 or so.
00:59:28
Speaker
And we said that, hey, you know what, if that's happening on being human, now let's just go all out. Why can't we, why can't this also happen on a mantra? Amazon, Google shopping everywhere else also. Right. So, so, so by Jan 2018, what we were thinking is that we have this omni-channel platform capability, which we've built very well for the backend, where it integrates into stores, does fulfillment from the store and whatnot.
00:59:54
Speaker
And on the front end, there is multiple different demand channels from which we're getting consumers to shop, whether it is find.com, whether it is the brand zone website, whether it is find store inside the store, or whether it is any of these marketplaces per se. So we reached out to all marketplaces, all large companies and said, hey, you know what, you don't have the kind of supply that we have.
01:00:15
Speaker
Um, you know, they were also looking at that because they, they could see that, you know, we've got store supply and, you know, they have old season merchandise, uh, and whatnot. So they say, you know what? Yeah, sure. Let's, let's figure out a way to integrate. So we kicked off integrations with Mintra, Jibong, Amazon, Google shopping, uh, Paytm, all of these guys. Right. And then some of them actually came back and said, Hey, you know what? We like what you're doing. Would you be willing to sort of, you know, take investment from us also?
01:00:43
Speaker
And that's how the conversation with even Google started. And then in 2018, Google ended up investing in the company. How much did Google invest? So Google invested, I can't tell you the number, honestly. I think close to about $10 million was that round that we ended up doing at Google. And I think that round was actually pivotal for us because it was the round where we were very clear. And what we're building is this omni-channel platform.
01:01:11
Speaker
where we have a lot of capability on the backend integration aspects, and we're going to open up this platform for anyone to actually build commerce on top of it.
01:01:24
Speaker
Before you go further, tell me what was your revenue split like in 2018? You have these four different businesses. I would say Find.com was always the biggest one because I would say that was the longest one. I mean, we ran that the longest, right? And I think in the other businesses which are sort of B2B businesses, I think the initial scale-up just does take some amount of time because
01:01:48
Speaker
you got to go brand by brand website by website marketplace by marketplace do these integration seven twenty eighteen it was still it was still very much fine dot com i was probably percent of revenue was defined dot com. Right but the other twenty percent was fairly profitable in itself right number one and number two is that we could see green shoots there so we knew that you know we were moving in that direction.
01:02:10
Speaker
And just that, because of running find.com B2C, we were out of capital because it takes capital to actually run our consumer business with the kind of custom acquisition costs that are there in this country. So we just needed more capital. But there were enough proof points to show that the non-B2C businesses also work.
01:02:31
Speaker
So we had at least four or five brands on each of the other products also. They were giving decently $200, $300 every day. And again, like I said, all of those orders were profitable. So everyone was very interested, very excited because this was probably the only profitable e-commerce business in the country at that time.
01:02:50
Speaker
I mean, not not find overall, but it's the non find dot com businesses which were which are fundamentally e-commerce businesses. Structurally, they were e-commerce businesses and they were profitable. I mean, right from the first transaction. OK, so like that, like, you know, if you integrate with Mitra, then what was would the brand deal list and go only through you and Mitra? Like, how would that happen? Because brands also list directly.
01:03:19
Speaker
So the way it happens is that for the, so the way Mintra deals with it is that, of course, the brand is free to give it through both. But the products which are an overlap, which is probably 15, 20% of the cases, Mintra would actually sell their seller products or their warehouse products. But there was a fairly good 65 to 70% of products which didn't have an overlap, which only we had.
01:03:49
Speaker
So there it was just us. And you were the fulfillment, you were responsible for fulfillment, like the product. Not in Mitra's case, we were not responsible for it because I mean, Mitra had its own sort of, you know, SOP. So we said it was short. I mean, see, fulfillment for us was always a pass through cost. I mean, we weren't really adding value with fulfillment. We were just sort of closing the loop with it. Right. So we said, OK, sure. If you want to do fulfillment, please go ahead and do it. No problem with me.
01:04:16
Speaker
So, but Mitra has a warehouse model, right? So then in case of fulfillment, you would send it to the warehouse. No, we don't. No, we wouldn't. We told Mitra that you can't, you know, we're not going to do that because it just, you know, wasteful spending. I mean, think of it that I'm a customer in Bandra and I've ordered something and, you know, it's actually in the store in Bandra. I'm not going to send it to the warehouse of Mitra in Bhivandi and then come back to Bandra. And it's just absolutely wasteful. So I told Mitra, I mean, I mean, we told them and, you know, they actually agreed to it as well because they would then pick it up from the store in Bandra.
01:04:47
Speaker
So then they changed their logistics in a way where they structured it saying that, hey, it's not just going to be originating from our warehouses. You also need to take it up from every other place also. And I think they had already started on this journey because outside of Mintra warehouses, they also allowed dropship from a few select sellers as well. But this is, of course, accelerating dropship to a different level altogether. What do you mean by dropship? Can you define that?
01:05:14
Speaker
Yeah, so the dropship is that I have the product in my warehouse and I am shipping it directly to the consumer without sending it to Mintra's warehouse, but I could be using anyone's delivery partner. It doesn't really matter. Got it. Got it. So like on Amazon, some products are like prime or fulfilled by Amazon and some are not. That's right. Those would be dropped. Yes, others that are not. Okay. And what is your arrangement with Amazon? Like, is it similar or?
01:05:40
Speaker
So Amazon is similar. In Flipkart's case, we do the logistics. In Amazon and Mintra's case, they do the logistics. In Taraklik's case, we do the logistics. So I mean, it differs from sort of marketplace to marketplace. I think we are okay either way, honestly. I mean, we don't have any major
01:06:02
Speaker
hiccups or sort of hang-ups on actually doing it ourselves. As long as we still get real-time tracking enabled on those shipments, we're okay with it. Okay. Okay. So let's move ahead in the story. 2018, you raised $10 million and 80% of your business is still from the B2C portal of fine. So what happens next?
01:06:28
Speaker
Okay, so yes, I think as 2018 goes by, we're scaling up all businesses now.
01:06:36
Speaker
Of course, B2C scale is faster because of the fact that there are less moving pieces. You aren't reliant as much on external entities to also scale up with you and so on and so forth. So that scale up happens decently fast. So B2C, of course, scales up tremendously. It's also because of the fact that we just received the funding. So we were a bit more sort of loose-fisted in terms of spending money for custom acquisition. So that, of course, scaled up.
01:07:04
Speaker
a fine store also scaled up. And I think when we exited 2018, we were still looking at that 80-20 split. It's just that the absolute numbers were much bigger, for both.
01:07:17
Speaker
Then, all through 2018, I think we were always talking to our investors and we said that, you know what? I think the current B2C model can't really work because you can't have 20 companies in the marketplace. In the market, everyone burning capital to acquire the same consumer and forget about different consumers. Unless we figured out
01:07:41
Speaker
any other way in which we can build a profitable B2C business also. We're giving ourselves one year to try as many things as possible. And we're giving ourselves a budget of this is going to be our experimentation budget. And if it works, brilliant, we continue. If it doesn't work, then 2019, we again come back to rethinking how is it that we want to go ahead with.
01:08:08
Speaker
So what ends up happening is that in 2019, per se, we were still not able to figure out a profitable B2C business. And that sort of led to us saying, you know what, now we're going to dial down our B2C focus. We're going to stop spending money. I mean, the platform's still there. People who are coming on if there's organic traffic will continue. But we're not going to spend money in acquiring consumers, per se.
01:08:38
Speaker
which is going to focus all our efforts into growing the other B2B parts of the business. And this is marketplaces, brand websites, fine stored, all of those things. So that's how we ended up going ahead with it. So 2019 is when we switched gears and we said that it's
01:09:04
Speaker
It's yet another change in focus. But I mean, those businesses are all there. It's just a factor of how much effort are we putting into what. And how did the Reliance deal happen? Right. So then I think early 2019, actually not early 2019, probably about late 2018, I think Reliance started talking to us. And I think, funnily enough, it was because of a presentation that I gave
01:09:34
Speaker
to their Gen Next incubator on how to build a company and how to build an organization. And I think GEO was already launched by that time and now they were looking at what next beyond just telecom, this whole, whether it's commerce, whether it's content, whether it's education, whether it's core tech IP, all of those things, they were looking at it. And I think commerce was one such section that they were focusing on.
01:10:03
Speaker
And I think, I think GEO also recognized the fact that I think, you know, they couldn't build commerce the way Amazon and Flipkart had built it. They wanted to do an omni-channel approach. At the end of the day, Reliance Retail is still the largest retailer in the country. They've got so many stores. They've got so many stock
Reliance Acquisition Talks
01:10:21
Speaker
points. So they wanted an omni-channel first e-commerce play for Reliance as well.
01:10:26
Speaker
And that's how they reached out to us and said, hey, you know what? You guys have built an omni-channel play. There are a few companies, but you guys are the only ones who have done it at scale. You guys have done it well across multiple business lines. You've done both B2C, B2B. So you guys have a fairly good understanding of exactly how to go about doing this. So if you guys are interested, we're interested in figuring out a way for us to work together. And by work together, we mean you become a part of us and then build this out for us.
01:10:55
Speaker
So end of 2018 is when those discussions started. And I think by that time, we were also coming out of the fact that our B2C experiments haven't really panned out in terms of a profitable business, per se. So if the B2B aspect is great and it's growing and it's profitable, and also the fact that Reliance is the largest retail in the country, plus I think by that time, we'd all seen what GEO could achieve.
01:11:25
Speaker
We were definitely enamored by the fact that, hey, an opportunity to work with Reliance was brilliant. I mean, it would be scale and ambition that none of us would have seen before. Of course, we all had that. But we wouldn't have seen that ever, at least for the next five, six years. But we were able to, I mean, we've got this opportunity to get a ringside view of this and also participate in building this up.
01:11:50
Speaker
But of course, we were very clear to them, and it was very clear to us that we want you guys to be in there. We're not buying your company. We're not acquiring you whatsoever. We want you guys to help us build this. And for that, if we need to take a majority stake, if we need to be the only other person on the cap table outside of the founders, we're willing to do all of those things. That's how we would want to do it. So first half of 2019, I think the contours of this got sort of finalized.
01:12:19
Speaker
mid-2019, we actually consummated this transaction. All our investors took an exit, but the company still remained independent. There were a few things, a few requests that we had as founders to Reliance in terms of, hey, we want to continue running our business the way we want to do it. We still want to be independent. Of course, we will help you build these things, and you have all right to comment and tell us if
01:12:43
Speaker
if you're doing a shoddy job at it, but otherwise, outside of that, it's our company at the end of the day. We're still running that company. Reliance was more than happy and gracious to actually allow us to do that because I think what they realized is the fact that more than just the technology, they also wanted the kind of culture and work ethic that we brought to the table.
01:13:06
Speaker
And that's why, I mean, it was absolutely amazing sort of conversation to figure out how this was work. And that's why we as founders also went in saying, hey, you know what, this is great for us. This is great for the company as well.
01:13:19
Speaker
And you know by the by they're also willing to give cash exit to all our investors and everyone makes money I mean, it's not a it's not a small exit. It's not a It's I mean everyone I mean the worst person made like a 30% IRR, right? So so so so it's it's not a bad investment for anyone by any shot whatsoever Of course, it's not the 100x or the 50x that you know, we see funders aim for but you know given given
01:13:48
Speaker
the far and few cash exits in the country, I think everyone was still pretty much, you know, saying that, you know, this is still good money for everyone. Did you also say the earliest? A little bit. Yes. Yes. A little bit. We did. Okay. Yes. A little bit. We did. Because I think, I think we just, I mean, I think Reliance was actually fairly open to asking that, Hey, you know what? We realized that you guys have spent eight years in this because they've been, you know,
01:14:12
Speaker
taking paltry salary out here. And if you guys need some liquidity, we're happy to give you some. So what have you built for Reliance so far, like the Reliance e-commerce play in that? So I can't give specifics whatsoever, but definitely what I can tell you is I think our capability of building an omnichannel platform, that's something that we're leveraging for Reliance.
01:14:39
Speaker
Like I think Reliance Digital, the online e-commerce site is Omni Channel. So that would have come through your experience. I mean, I can't say so much more than that right now, honestly.
01:14:53
Speaker
And Reliance is OK with you continuing to also be present on Vintra. Absolutely. See, I think that was one of the things that we told them. Listen, even though you are a majority investor, we are not looking at it as the end of the road for find or for us as founders. I mean, we believe, and Reliance agreed, that we've barely scratched the surface when it comes to retail tech and omnichannel per se.
01:15:21
Speaker
And again, both of us agreed that we are a far number one in the omnichannel space today. And as long as that business makes sense, that business makes money, has a long-term capital creation and a value creation angle to it, why would we not pursue that as well? And as long as we're able to balance out and not ensure that our work is getting affected because of multiple priorities,
01:15:51
Speaker
That's fine. That's fine. If we're able to juggle it, they're okay with it. Second thing is that we were very clear that there will be absolute Chinese wall in terms of data sharing between Reliance and Find. So while, of course, everything that we're doing for Reliance works with them, but what we're doing for any of the other brands in the other marketplaces do not go to Reliance at all. So Reliance, they have no access to any of that data whatsoever.
01:16:18
Speaker
And that was also very important because I think everyone realizes that Reliance is one of the large players in this segment, competing with the same sort of Flipkart, Mintra, Tada, Klake, et cetera, et cetera. And it was important for us to actually ensure this so that it doesn't hurt Find or its other clients right now that we work with.
01:16:37
Speaker
But would this continue?
Competitive Landscape Discussion
01:16:40
Speaker
I mean, eventually, you know, the competitiveness between Amazon and the lines, for example. I mean, think of this way, right? Think of this way. As long as this company is still independent, this is well within all sort of documents that this will continue. As in, in the sense that would, for example, Amazon continue to integrate with you, they may decide, OK, we don't want to
01:17:05
Speaker
I mean, think of this way, right? I mean, think of this way today. Uniqomis is a Snapdeal company, but they're still working. I mean, Amazon and Intra still works with Uniqomis. There was a time where GoJavas was a Snapdeal company, but everyone else used GoJavas as well.
01:17:20
Speaker
So I don't see I don't see why not. Right. I mean, I think I think I think share ownership is very different from operating principles. Got it. OK. Who are some of the competitors to you? Like, you know, who would provide a similar end to end going on? Yeah. So there's a company called there's a company called Arvind Internet Limited, which the Arvind group has had fond. I mean, it's still there.
01:17:44
Speaker
And then there's another company called East Turtle, which was a bunch of ex-Arvind and Alliance fashion executives who launched that company as well. I think they were both launched by fashion brands, so they're fashion-first companies.
01:18:00
Speaker
we're probably the only sort of tech first company solving it as a tech problem as opposed to anything else. How would your size compare to these like Arvind and all this? No, I mean everything in terms of client science, we are like significantly bigger. Okay. Okay. And so when a brand signs up with you, you essentially are like their one-stop shop for everything e-commerce, right? Like be it through store, be it through marketplace, be it through find website, be it through the brand's own
01:18:29
Speaker
That's
Expansion into New Categories
01:18:30
Speaker
right. Everything is handled by you. So when a brand goes to Mintra through you, then how much does the brand get left with? Because Mintra would take a cut. You would take a cut. So our cut is very, very minimal. It's more a payment gateway version per se. I think what doesn't change is that the brand still needs to work with Mintra. And Mintra will still work with the brand. Think of us as just the platform that's serving those listings to Mintra.
01:18:57
Speaker
Have you moved beyond fashion now into other areas? Yes, we have. So I think we've definitely started with some amount of furniture, furnishings, kids equipment, toys, all of that we've started. Very soon we'll be starting with electronics as well. So I think it just sort of goes down to we see the margin dynamics of a particular category. And then that's it.
01:19:23
Speaker
Okay. Okay. So electronics will be pretty cutthroat, right? I mean, like that's very well established. So you know what? We don't even have to worry about it, right? Because we're just the platform serving it. I mean, we don't do the custom acquisition. We don't do any of those things. So for example, someone like a Philips could decide to work with you for all their end-to-end e-commerce requirements. Yes. That's right. Okay. That's right. Got it. Okay. Okay. Cool.
Lessons and Key Takeaways
01:19:51
Speaker
So what has been your biggest takeaways through this journey, like top two or three takeaways which you think would help other founders? Yes, I think one thing we've been very lucky with, and not all companies have been there. I mean, there have been others also, is that I think the three of us as founders have stuck together for the last eight years. I think that sort of longevity and working relationship, per se, I think has definitely helped us a lot.
01:20:20
Speaker
I think that's number one. Number two is that if you've, again, heard the journey so far, while we've been working in the retail tech space since day one, there are a bunch of different things that we've done, right? Some have worked, some have not worked, and those sort of things. So I would say one big takeaway for us was experiment on anything and everything. But of course, once you figure out something that works, go behind it. But don't stop at that.
01:20:48
Speaker
what we started with diesel as shop sense is back on as fine stored three years later. So I mean, it's just all over the place. But nonetheless, I think the problem that we're still solving is how do we get technology in the physical store? I mean, it started off with being more consumer engagement, but it's gone from consumer engagement to even transactions and fulfillment and consumer engagement also. So I mean,
01:21:17
Speaker
So it's the same sort of problem that we're solving. I think the solutions are sort of different and many. But the problem to be solved is still the same. So that would be my sort of second one. And I think the third one is that we've been very lucky to have investors to support us through this journey. I mean, any investor could get really frustrated with so many changes that are happening, so many differences in terms of business. I mean, it's almost every year we had something new.
01:21:49
Speaker
You can say that this is one more trick that these guys are trying to prove, but they've been with us. We had a fairly long list of investors and definitely giving them a cash exit with decent returns is one of the proudest moments of our lives as founders.
01:22:09
Speaker
So I would say that has been the third thing. And I would say all of our investors, right? I mean, all of them would attest to the fact that they loved being a part of our journey. So I want to ask you how for two of these. So you said all three co-founders sticking together, how did that come to be? Is there like a guide on how co-founders can stay together?
01:22:33
Speaker
Yes, I mean, see, I think first and foremost is that I think there needs to be a mutual honesty in terms of the motivation behind doing this, right? I mean, it's fine that the three of us could be starting up for different reasons. I mean, one of them could be for money, one of them could be for fame, one of them could be for the glorification of the ego, whatever else it could be. I mean, it doesn't matter.
01:22:56
Speaker
But as long as there is honesty and there is an open communication behind these motivations, and there is a long-term plan to it, right? I mean, it would not have worked if one of the three of us said, hey, you know what? This is just a five-year thing for me. It would not have worked, for sure. But all three of us were on the same page that said, you know what? Even if we have to do this for the rest of our lives, we will do it. So I would say that was like super important.
01:23:23
Speaker
And I think the second is, I think all three of us definitely have had our ups and downs, right? I mean, there have been times where, you know, relationship is strained, better, you know, other times, whatnot. I think they're just part and parcel of, you know, any relationship. But I think we never once put ourselves ahead of the company. And I think even in our fights, right, even in our disagreements, the company always came first.
01:23:52
Speaker
So that helped a lot. What kind of salaries were you taking for the first couple of years? No, so I mean, very, very low setting. I think first year was zero. I think second year was probably more like, you know, five, six lap rupees a year. And then at every funding round, it would increase by 30 percent at every funding round. Right.
01:24:12
Speaker
But yeah, that's pretty much it. I mean, it's just that. Of course, now it's far more sort of mark to market, where someone off my batch has similar responsibilities and sort of mark to that right now. But up until that time, we were just used to pretty much under market by large margins.
01:24:31
Speaker
So it was never for salary. I mean, I mean, you know, this sort of goes back to the fact that because I think I think the three of us and the families weren't really counting on our income to run the household, right? That's why we were able to, again, take those risks. So we knew that the problem.
01:24:49
Speaker
I mean, all three, our wives are working. They were getting decent income. Families were fine. We didn't have to send money back home. So I think those things were taken care of. So I think that was very lucky for us. So the second
Building Investor Relations
01:25:04
Speaker
how I want to ask you is how did you get your investors to be so loyal to you?
01:25:12
Speaker
I think that is all down to communication, honestly. So till about the Google round, I would say, which is 2018, I would actually send out an email every month to every single investor. I don't care if the investor put one lakh in the company or put a crore in the company. That same email with the same data points would go to every single investor.
01:25:33
Speaker
And there would be an absolutely regimented frequency to that email. The fifth or the seventh of every month, I will send them updates of the previous month, a few lines on what we're working on this month. And these are the two to three areas where we need help from you. And I think this transparency ensured that across the three, four years that the earliest investors
01:25:59
Speaker
were part of the company for about five years, every month they would know what they were up to, every single month. And I think that was very, very key. That was extremely important, I feel. I mean, today I am probably an engine investor in about a dozen companies. Probably only one or two are keeping me updated with what they're up to every month.
01:26:25
Speaker
And in all fairness, it's those two companies whom I would go out of my way to help if something comes out. I mean, of course, I would be helping other companies also, but I would really get the context of the help much better. So
Angel Investing and Supporting Juniors
01:26:42
Speaker
your journey as an angel investor, when did that start and what is your thesis as an investor? So I think it started
01:26:52
Speaker
2018 2018 is I think when it started and I think the thesis when it started was was fairly to give back right I mean we had so many Indian investors on a cap table a bunch of those were essentially seniors from IIT who had started their own companies and had invested in us some of those companies they got an exit some of the companies they had to shut down whatever it is
01:27:12
Speaker
But they still supported us. And I think the first few investments that we made were, again, in juniors from IIT Bombay only, who had actually started the companies, came to us predominantly for advice more than anything else. And we said that we like this team. We like what they're building. And you know what? Hey, can I invest one, two lakh rupees in your company?
01:27:32
Speaker
So it started off with just being that. I think there is definitely probably 50% of the portfolio is IIT Bombay juniors or whatever juniors, batch mates, one, two seniors, things like that.
01:27:45
Speaker
But it sort of began, it completely began that way. And I think now, I think thanks to the liquidity that Reliance was generous to give us, I think it sort of amped up a bit in the last few quarters. But even then, the thesis has more to do with, you know, hey, this is a good team. I like them. I like what they're doing. And if I can help with, you know, whatever, 2-3 lakh rupees, shock, why not? How do you define like this is a good team? Like, you know, what do you look for?
01:28:10
Speaker
You know, it's difficult, but I've actually written these things down. So, I mean, there's sort of five things that I look for in a company and I'm evaluating a company. I think two of these have to do with sort of founders. I mean, actually, three of these have to do with founders and two of them have to do with the market in general. And this is like early stage companies that I'm talking about. So I think the two things about the market that I look at is one is, of course, the market size.
01:28:37
Speaker
which is the absolute size of the market, the growth potential, and the competition in the market. That for me will define the market size. The second thing that I want to look for in the market is the depth of the problem. How well is this problem understood? If I have a solution for this problem, how easily is it going to get adopted for? Is this going to require a lot of education? Is the time now? Is it going to take three, four years to do it? I'm saying these are the two
Future Tech at Find
01:29:03
Speaker
things that I look at in terms of the markets now.
01:29:06
Speaker
And I think the three things I look for in the founder, per se. I think one is the founder's personality themselves. So are they a hustler? Do they have the curiosity and the learning capability? Do they have the ability to attract good people? Do they have a fundraising ability? Do they talk well in front of investors? Are they able to capture an investor's interest and their sales and storytelling ability? Are they able to sort of
01:29:36
Speaker
absolutely, crisply communicate, you know, what is it that they're trying to do. So these are the few things that I would sort of look in a company. Of course, I don't expect every company to have all of these things. But if someone has, you know, two things, which are very good, third, which is like, okay, fine, you know, I should go ahead and, you know, do something there. But then, like I said, this is purely for early stage companies. I think these sort of metrics or areas would change as there's more data to look at within a company.
01:30:06
Speaker
But I don't really invest in anything post a series A stage at all. I mean, it's usually a seed or almost a series A. So what next in terms of the technology you are building at Find?
01:30:22
Speaker
What can we expect to see? I think there are two areas of growth. I think one is the existing business lines. I think we need to grow those. So get more brands, get more clients, get more marketplaces integrated onto that, get more customers. I think that's one part of it. I think the second part is, what are the kind of new age technologies that are sort of redefining the way shopping is happening?
01:30:50
Speaker
Looking at computer vision, looking at augmented reality, virtual reality, how does beauty shopping work in the age of AR? Or how does in-store consumer behavior, understanding change in the day of using CCTV footage to understand that? I think these are the two major areas of work that's happened.
01:31:18
Speaker
That was Harsha talking about setting up and running fine. If you'd like to avail some great offers on apparel and fashion, logon to fine.com.
01:31:41
Speaker
If you like the Founder Thesis Podcast, then do check out our other shows on subjects like Marketing, Technology, Career Advice, Books and Drama. Visit the Bodham.in that is T-H-E-P-O-D-I-U-M.I-N for a complete list of all our shows. This was an HD Smartcast Original.
01:32:13
Speaker
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