New Delhi: Social commerce startup DealShare aims to gross $3 billion in revenue by March 2023, Sourjyendu Medda, the company’s founder and CBO told ETRetail. The company recorded a GRR of USD 1 billion at the March 2022 exit.
The brand envisions 3x growth through geographic expansion, improved customer retention and increasing the basket value of existing customers.
“This fiscal year, we had $1 billion in gross revenue. Also next year, we are aiming for very rapid growth. We believe that we will be able to grow almost 3 times next year. So , by the end of next March, we should cross the milestone of $3 billion in gross revenue,” Medda said.
He shared that the company is currently at a minus 13% EBITDA line, but is approaching minus 10%. Over the next year and a half, the social commerce platform aims to break even.
“We improved our EBITDA by 5% last year and last year. I think the real EBITDA burn will go down further. And I think we’ll break even in a year to a year and a half,” he said.
DealShare provides brands and local entrepreneurs with a platform for mass e-commerce. The company focuses on tier 2 cities, tier 3 cities and small towns and provides high quality products at low prices to customers.
To differentiate itself from the competition, DealShare focuses on a demand generation model, sourcing from SMEs, and efficient warehousing and logistics.
Talking about its demand generation model, Medda shared that 50% of customer acquisition for the company is through customers as a referral.
“For us, the main source of customer acquisition is customers bringing customers as a referral, where we give micro-incentives to our customers to bring more customers. And those micro-incentives can in besides being used as savings for purchases.”
“It significantly lowers our cost of acquiring customers. And on top of that, word of mouth is generated. So, as a result, 30% of our acquisition, in addition to 50% referrals, comes organically. Thus, 80% of our customer acquisitions come mainly from non-bidding channels or very low paying channels. »
The company claims to have onboarded nearly 16 million customers on its platform to date.
Talking about the second differentiator, Medda shared that the brand has developed a strong network of SMEs for manufacturing. It works closely with local manufacturers who help provide quality products at lower rates.
The company currently has around 500 SMEs in the essential space and aims to increase the number to 1,000 SMEs within a year, Medda said.
Additionally, DealShare focuses on the frugality and efficiency of its warehousing and logistics system. “We do full warehousing and logistics at just 6-7% of the merchandise value, which typically if you look at other e-commerce players is 20%. So that’s again a big differentiation, because ultimately every cost has to be borne by the consumer,” he explained.
“We are also deploying community leaders to do the last mile deliveries because they know the locality very well and therefore the actual cost of last mile operations is low. On top of that, we are doing a lot of densification in each area,” Medda added.
Sharing details on future plans, he said this year the brand will invest in technology, increase its geographic presence and hire talent.
DealShare became a unicorn earlier this year after raising $165 million from investors led by Tiger Global and Alpha Wave. The company has raised $393 million to date and is currently valued at approximately $1.7 billion.
Asked about fundraising plans in the future, Medda said the potential was extremely high. “Investment is needed to make it a big retail business. So we would do fundraising for infrastructure investments and that will be an ongoing process.