ShopClues closed FY15 with $400M annualised GMV run-rate, eyes $1.5B run-rate by Mar'16

The country's fifth-largest multi-product or horizontal e-com marketplace ShopClues said it closed FY15 clocking gross merchandise value (GMV) run-rate of $400 million (Rs 2,500 crore) last month. The firm is now aiming to almost quadruple it in a year, Radhika Aggarwal, co-founder and chief marketing officer, ShopClues, told Techcircle.in.

GMV, a key measure to track performance for e-commerce companies, represents the value of the products sold through their respective sites. In India, foreign investment for consumer e-commerce is not allowed and firms operate 'marketplaces' which essentially operate as a platform for third party vendors to sell to consumers.

ShopClues, like almost all its peer group firms, operates as a marketplace and gets a fee from the sellers on its platform and ads on behalf of the vendors to showcase their product on the site. Hence the actual revenues of e-com marketplaces are just a fraction of the GMV.

Moreover, run-rate measures the projected annualised value of products sold through the site. So a Rs 2,500 crore run rate for ShopClues means last month it generated GMV of a little over Rs 200 crore.

ShopClues had ended FY14 with GMV of Rs 350 crore and its actual net revenue was around Rs 30 crore with net loss of Rs 38 crore for the year ended March 31, 2014.

ShopClues' bigger home-grown rivals such as Flipkart and Snapdeal had crossed $1 billion run rate in early 2014 and have grown manifold since then.

It's two other bigger rivals include the Indian units of global giants Amazon and eBay.

Radhika told Techcircle.in that the firm is now looking to be profitable by 2016.

"Among internet companies we got a considerably low capital burn rate. We have spent only $25 million to date," she said.

ShopClues, which counts Nexus Venture Partners, Helion Ventures and Tiger Global as investors, has so far raised around $130 million, including the recent Series D round worth $100 million led by Tiger Global.

Loaded with fresh cash, the company is now also looking to acquire technology companies with strong talent base in the internet/digital marketing space.

"We look to do a few acqui-hiring since we want to bring in tech talents," Radhika said, adding that the company aims to increase the number of sellers on its platform from 125,000 currently to 10 million by 2018.

ShopClues focuses on unstructured/unorganised categories which contributes to two-thirds of its gross merchandise sales unlike other marketplaces, which tend to focus on mobile, electronics, computers and branded fashion.

"Our buyers are more selection-driven than brand-driven," according to Radhika.

The Gurgaon-based startup was founded by former Wall Street tech analyst Sandeep Aggarwal and a former eBay executive Sanjay Sethi in July 2011.

Prior to setting up ShopClues, Aggarwal was a senior internet and software analyst at Caris & Company, a San Francisco-based, research-driven boutique investment bank. He had also worked with companies like Collins Stewart, Oppenheimer & Co., Citigroup Investment Research, Microsoft Corp, Charles Schwab and Kotak Securities.

The company went through a tumultuous period over the last two years after Aggarwal (then CEO) was found to have indulged in insider trading in the US in his past job and he later pleaded guilty to the charges. He has disassociated himself with his executive role at ShopClues. His wife Radhika has taken over more a direct role at the firm and is listed as a co-founder now. Meanwhile, Sethi became CEO after Sandeep Aggarwal was arrested in the US.

"Our buyers are more selection-driven than brand-driven," according to Radhika.

The Gurgaon-based startup was founded by former Wall Street tech analyst Sandeep Aggarwal and a former eBay executive Sanjay Sethi in July 2011.

Prior to setting up ShopClues, Aggarwal was a senior internet and software analyst at Caris & Company, a San Francisco-based, research-driven boutique investment bank. He had also worked with companies like Collins Stewart, Oppenheimer & Co., Citigroup Investment Research, Microsoft Corp, Charles Schwab and Kotak Securities.

The company went through a tumultuous period over the last two years after Aggarwal (then CEO) was found to have indulged in insider trading in the US in his past job and he later pleaded guilty to the charges. He has disassociated himself with his executive role at ShopClues. His wife Radhika has taken over more a direct role at the firm and is listed as a co-founder now. Meanwhile, Sethi became CEO after Sandeep Aggarwal was arrested in the US.

(Edited by Joby Puthuparampil Johnson)