With 2 crore turnover, 3-yr-old startup eSparsha gears to tap the $10 bn marketJai Vardhan
Bala Satish G, Nalin Goel and Karthik Venkat met while pursuing their engineering from NIT, Allahabad. The trio completed graduation with flying colours and ended up in jobs with seven digit pay cheques. However, they saw a big problem in procuring customized merchandise which turned into a business of over two crores within three years.
Customized merchandise is more of an experience rather than a product. “The market looked very disorganized and was not at all service oriented. We identified the big opportunity and realised that the problem was worth solving so we dived into it,” says Nalin, Co-founder, eSparsha.
eSparsha offers customized merchandise for institutions and corporates. In the last three years, the startup has established itself as a reliable service provider for merchandise. “During these three years we tried to understand the industry in detail, and took feedback from hundreds of customers and shaped all these things into an innovative and scalable upfront platform called Mydreamstore,” adds Karthik.
Mydreamstore allows people to design and sell custom t-shirts online with zero inventory and zero upfront costs. Clubs and classes can order their merchandise without taking any trouble and designers can launch their series of designs. It lets you create merchandise for your group in three simple steps.
Prior to eSparsha, Bala worked with Cypress Semiconductors while Nalin is pursuing graduation from IIM Bangalore. Karthik had a brief stint with a startup before co-founding eSparsha.
According to market estimates, the total addressable market was about $2 billion in 2008 with a CAGR of 14-15%. “With increasing internet penetration, growing online commerce and prevalent pop culture this can reach upto $ 20 billion by 2018,” says Nalin.
With nearly 100% growth from the first year itself, eSparsha had posted a turnover of two crores in the last fiscal. The company processes 700 bulk orders a year and caters to 1.5 lakh customers every year from about 300 institutes across the country. “With the launch of Mydreamstore, we are making it open for anyone to sell customized tees via our platform. We are expecting a growth of 15X in the next three years,” says Bala.
Mantra of bootstrapping
The trio took time to learn the art of bootstrapping and now stick to the thumbnail rule of frugality. “We were quite frugal from day one, as we were actually spending our own money rather than burning investor’s money. We didn’t seek funding for eSparsha as we achieved breakeven quite early,” says Nalin.
eSparsha has been profitable from 2012 and has grown to a team of 30 people. For its upfront (B2C) arm, Mydreamstore, eSparsha is looking for investments to scale the venture and cater quality merchandise to everyone.
Seth Godin says, “Don’t find customers for your products. Find products for your customers.” On the same lines, Karthik says, “Since our inception, we were able to identify the key pain points of our customers. We would be committing suicide by not responding to that. We wanted to live and grow and improvise.”
Challenges on the way
“Providing quality merchandise is a very tough problem. A simple T-shirt with a custom print involves about 30 micro operations. Creating processes and a foolproof back end, handling customer rejections, tight cash flows especially when you are self funded is a great challenge and learning experience,” outlines Bala.
What keeps the team alive at work each day are the challenges faced by the core team. Besides these, building a great team has always been a challenge for first time entrepreneurs and the trio are no exception. “We learnt a lot through trial and error. A lot is still to be learnt about hiring and how to keep the team motivated,” adds Nalin.