[Update] Power2SME Raises USD 6 Million in Series B Funding
Founded by R. Narayan in 2011, Power2SME is a group buying site targeted at small and medium enterprises. The company today announced that it has raised USD 6 million in Series B funding from their existing investors. The funding round was led by Accel Partners with participation from Kalaari Capital and Inventus Capital. The funding will help Power2SME to scale up their current business by extending its footprint to South India, increase their product portfolio, expand their sourcing channels to include direct imports for their SME customers and make additional investment in technology & marketing.
Power2SME has raised close to $8 million in previous rounds as well and talking about the recent round, Narayan said, “Power2SME’s aim to help unlock the potential of SMEs, whose progress is so critical to the India growth story. We believe that the power of the SME sector is largely untapped and holds great potential. Power2SME aims to help the SMEs to improve their efficiency and provide a significant lever for growth and profitability. With quarterly revenues run rate of more than $2 million and 13,000 registered SMEs users in less than 3 quarters of operations, Power2SME is well on its way to becoming a one stop destination for SMEs for all their business needs.”
Read their complete story and here are the updates post our conversation with Narayan:
YS: Can you tell us a bit more about the investment and how are they going to be utilized?
Narayan: We have been growing at a good rate and had a lot of investor interest but our existing investors had faith in us and all participated in the current round as well. The funds will be utilized primarily to scale the business which will be done via:
1) Our current footprint is strong in NCR and Maharashtra which we want to increase and take it to other parts of the country as well, especially South India.
2) We’re looking at procuring from global players as well
3) We’ll be working with exporters to get more purchase for them too
4) We already have 14-15,000 SME’s who we are working with and now we’ll be cherry picking some of them to work as a strategic partner.
YS: How big is the team at the moment? And what are the hiring plans?
Narayan: We’re a team of close to 90 people right now and this won’t go up by a huge number because we have an inherent scalability in the model. The same number of people can now do a lot more.
YS: You’ve been in the SME space from the sale and marketing side for about 15 years, what’s the biggest learning?
Narayan: If you’re building a business around SME’s, you need to have a proposition which brings the SMEs to you and you don’t have to chase all the time. If you’re the one who is always chasing, you’ve got it wrong in most likelihood.
YS: One hiring tip that has worked.
Narayan: Choose the top management very well. I did all the hiring myself and made sure we have some experienced people (also with startup experience) who are steering the ship.
YS: What’s the road ahead?
Narayan: We’re going at a great rate and if continue doing what we’re doing, I see an IPO as the best option in about 4 years from now.