Kiran Gali's NumberMall app was the outcome of a good deed, a favour to a friend whose kirana store he was tending to one fine day at his village during the Diwali of 2011.
Managing multiple inventories for different telecoms was proving to be a nightmare, so Kiran decided to make the small merchant's life easier with a technology platform that would help process mobile payments, recharges, money transfers and the like, as well as aid the retailer in procuring store merchandise and selling hyperlocal offers.
He launched NumberMall, aiming to tech-enable not one but all small merchants so as to accelerate e-commerce adoption. A few months later, in February 2012, he bootstrapped it with his personal savings of Rs 10 lakh.
Hyderabad-based NumberMall is the first app-based, all-in-one payments platform for small merchants in India, says Kiran. It is engaged in providing mobile phone-based online citizen services, such as mobile recharges, DTH recharges, data card recharges, post paid bill payments and bus tickets, on a single platform.
"We are building what is probably the first B2B e-commerce marketplace for kirana stores, in which local merchants will be able to procure all store needs from our platform, and we have tied up with more than 50 suppliers to provide the best prices," says Kiran. "We will disrupt the B2B e-commerce space soon."
Other players have been into terminal and SMS technologies. While the starting point has been the same with some others, NumberMall intends to utilise the retailer network to accelerate e-commerce adoption among cash customers, he explains, adding that 15,000 small merchants, basically from mom-and-pop corner stores, have already signed up for the service.
Considering there are 14 million small merchants in India, and the total retail size is USD 600 billion, it's a good enough market to tap into.
As most of India does not shop online, they do not get the price benefits of e-commerce. "E—commerce, through local small merchants, is the new emerging sector and there are just a few players in that space, namely StoreKing and iPay," Kiran points out.
The founder-CEO also noted that the majority of India is still comfortable with the local kirana store and wants to transact with cash. But this majority is in the dark when it comes to e-commerce, and this is where other startups have failed to deliver, he realised.
"While payments have been a hook to attract the consumer, we are also selling goods online to these consumers. The next cycle of growth for e-commerce firms will come from a hybrid model and NumberMall, which connects the seller, service provider, merchant and customer, is perfectly positioned to be the omni-channel partner for online firms," says Kiran.
Pay your bills, recharge your phones and do much more from anywhere in the world, says the startup's website, hosting a wallet option that calls itself a single gateway for all payments, recharges and tickets.
Kiran targets the cash customer who is comfortable transacting with the local store. Retailers, he says, are delighted with the reduction in inventories with their model and the ability to sell multiple services on one platform is a boon for them.
Explaining his business model, Kiran says that NumberMall boasts a robust merchant network that provides the end-consumer with multiple services. "We charge a marketing fee for all sellers on our e-commerce platform. Very soon, top brands can talk to us directly to make their merchandise available in all our merchant stores," he says.
The venture's growth prospect is significant, with most of the 14 million small merchants yet to be roped in. Venture capitalists are also showing interest, with talks on for Series-A funding. Kiran received angel funding of Rs five crore from SRI Capital this January, spending most of it on drawing in new merchants, building a professional team and developing technology.
He reports that annual turnover is around Rs 120 crore, with business growing 10 per cent month-on-month, though the company has set its sights on 25 per cent month-on-month growth.
Amid so many similar platforms, competition is limited as only a few players are trying to make it big via the e-commerce-through-kirana model. "E-commerce through kirana is still at a nascent stage, hence competition is limited. There can be buyout opportunities from larger online brands who want to pursue an omni-channel strategy for their next growth curve. But competition might heat up in the next few years," says Kiran.
He lists his challenges: building a network is tough, and internet speed in rural areas is a bottleneck in expanding base. Currently, NumberMall is optimised to run on the 2G network.