1 Oct 2020
DealShare - Social Commerce Start-Up

    In India, the e-commerce industry has been on the rise expected to become the second-largest e-commerce market in the world by 2034. The e-commerce market is expected to reach 13,97,800 crore by 2027. Among the emerging names in the e-commerce sector is DealShare, a Social Commerce Start-Up as it focuses on middle and lower income population in Tier 1 and Tier 2 cities. DealShare is a flourishing online e-commerce platform for multi-category consumer products.

    Founders’ Concept

    Jaipur based e-commerce retail start-up, DealShare was founded by a group of five entrepreneurs Vineet Rao, Sourjyendu Medda, Sankar Bora, Rishav Dev and Rajat Shikhar in the year 2018. Having their experience in working with Microsoft, Metro Cash & Carry, Raymonds, Aeon Learning and Grofers in the field of building database, cloud system, sales, CRM, re-seller business, pricing function, they decided to summate their experience in the Start-Up.

    Having various deals and discounts if offers daily-use products such as food items including fruits, vegetables, and dry fruits, FMCG products such as lotions, soaps, cleaning liquids, etc., as well as gift items and household items such as buckets, and mops. Being a social commercial model, it targets lower and middle-income as well as non-metro customers in India.

    Unique Business model :

    DealShare, runs on a group-buying platform basis that focuses on offering select popular goods at a much-bargained price. Model of DealShare is mostly similar to that of China’s Pinduoduo, which encourages users to buy in groups and also it promotes sharing the product offers with friends and family members, who are then tempted to buy the products and like this, the chain goes on and on.

    With this strategy, only in the very first year of its existence, DealShare has furnished more than 1 Million orders. Available on Google Play, the DealShare app has more than 10,00,000 installations.

    Since inception, DealShare has raised $ 14.3 Million from 3 funding rounds, latest being a Series-A round of $11 Million from Matrix Partners India and Falcon Edge Capital as lead investor. Other investor includes Omidyar Network, DST Global, Whiteboard Capital.

    How It Works ?

    On the app, which is now available in English, Hindi and Gujarati, there is no concept of cart. It is a simple interface where a customer can scroll through a feed to browse through different products, with some categorization. Customers can order products through a single click.The company has a cut-off time at night, and whatever each customer has ordered until then is clubbed together and sent the next day.

    At any given point of time, the platform has an average of 500 Stock Keeping Units (SKUs) across 200-250 categories.

    On the supply side currently it has around 150 manufacturers and suppliers on board. More than 70 per cent of what are local or regional manufacturers. According to Medda, working with the local level players also helps them extend the kind of deals that have made them so popular among consumers.

    The Start-Up has also created WhatsApp groups of existing customers to inform them about deals and offers. Around 100 WhatsApp groups with more than 15,000 customers are maintained by the startup for hourly information on top deals.

    Major Challenge :

    For a platform that caters to a very different audience compared with the likes of Flipkart and Amazon, it was also important that the logistical costs were taken care of. From traditional to different ideas, DealShare tried everything, but nothing really worked out to their liking. And so, they introduced something called ‘DealShare Dost’.

    “A Dost is a micro entrepreneur in the sub locality, who belongs there, has been there for years and has access to manpower,” says Medda.

    The start-up takes a certain amount as advance to de-risk itself and works on a variable mode wherein the earnings depend on deliveries they make or transacting customers they bring. In the bigger cities such as Jaipur, Ahmedabad and Mumbai, these partners only do deliveries but in smaller cities, some even provide warehousing services. Around 70 percent of deliveries now happen through this model and the plan is to move the remaining 30 per cent as well.

    “This model has become a big strength for us and potentially, this can be a different company altogether - a logistics company with us being the biggest use case.”

    Future Plans of the Start-up :

    The Start-Up is expected to expand to 100 cities over 10 states in its next 12 months. Eventually, the idea is to create a platform and not remain on an inventory-based model and use the Online-to-Offline (O2O) Model for reducing operating cost and increase overall efficiency

    “The moment my suppliers become digitally savvy, and they can start listing their products and do business on my platform, which is when I will switch to a platform-based model.”