In his cushy corporate job as India CEO of Monier, a German brand, it is safe to say that Prasanna Raghavendra was at the pinnacle of his 19-year-long career. But in his own words, not every story is ‘cute’, and his was a rather practical one. Speaking from his conscience as to why he left the comfort of his job to start up, he says
“We missed the dot com boom because we weren’t equipped, but we didn’t want to miss the e-commerce wave, especially when it is touching so many lives.”
Prior to Monier, Prasanna, 46, was with Panasonic, where he met his partner-in-crime Hemachandra Bhovi, 40, who was serving as the India CTO for the company.
The two had met in 2009, and were still in touch. Conversations often veered to the big problems that needed solutions. From construction equipment and diagnostics, to real estate, the duo had their eye on every sector, but Prasanna’s passion for automobiles won the day. His vision was of a curated e-commerce platform for brand new cars and bikes, from where people could buy vehicles or book test drives from the comfort of their homes.
Prasanna adds, “This was the last untouched brick-and-mortar model that didn’t change much. Moreover, since people researched new cars and bikes online, why not give them the convenience to buy them online?”
The co-founders also noticed the recent rising numbers of car and two-wheeler buyers, who were unhappy with the exercise of running to showrooms only to return unsure of whether they were getting the best deal. This was particularly true in the hatchback, entry-level sedan and two-wheeler segments.
Thus was born zipzapwheels.com, an e-commerce platform curating brand-new as well as used cars that allows customers to buy and book test drives online. With an initial investment of 50 lakhs, the firm is in partnership with 60 dealers in Bangalore and plans to take the platform to NCR, Pune, Mumbai and Chennai as a part of the next phase of growth.
The platform has successfully sold 125 units since May 2015. However, according to the co-founders, these are prosperous times and 60 per cent of their sales was witnessed in the past one month. Further, they are planning to double the number of units sold by the end of next month.
When asked how much time on average it took to sell a certain unit, Prasanna says it entirely depends on the consumer. The fastest sale made on the platform was 50 minutes for a bike, while the longest sale conversion took a month. He says that there are two kinds of consumers.Those who are sure of what they want to buy close transactions within 24 hours, with an additional day taken to process the loan, if availed.
The unsure ones tend to take as long as three days to narrow down on a decision. While the venture refuses to reveal its revenues, the platform is free for its customers. They charge the dealership a certain percentage of the cost of every unit sold. Prasanna says that although they haven’t narrowed down on a fixed percentage, it can vary depending on multiple factors such as demand for the vehicle, the stage of launch, and the inventory.
The platform also has a ‘Hot Deals’ section, which helps customers know the best offers available on a certain model across dealerships in a particular city.
By the next quarter, the venture plans to integrate more features onto the platform. They plan to build, integrate, and develop a proprietary auto loan product, which will help customers apply for loans swiftly and effortlessly. The business is already in talks with six big banks while running an engagement with ICICI Bank offline.
The founders are also planning to improve the consumer experience by integrating curated deals that give live information on the availability of a unit, and by when will it be ready for delivery. It will also provide extensive information of the model and the month of manufacture.
The firm plans to increase the units sold to 500 per month, while aiming at engaging a monthly traffic of 300,000 daily visitors. At present, the firm sees a daily traffic of 1,500- 2,000 visitors.
When asked about any exciting moments in his entrepreneurial journey, Prasanna recollects the first lead the platform received. He narrates how the team was jumping when they got their first lead, curious to know from where the gentleman had reached them from.
Speaking of the overall vision, Prasanna tells us that they aim to service the entire life cycle of the product. Within the next year, they are likely to introduce newer verticals related to servicing, accessories, and driving destinations onto the platform.
In short, as the founders describe it, they want to bring motoring to your pocket.
The auto classified market is not new to India. Although the founders refute this, they are pitted against stronger competitors like CarDekho and CarTrade, who have been in the market since 2008 and 2009, respectively.
Here are the numbers:
CarDekho.com is amongst the top 200 most popular websites in India according to Alexa ranking and received Series B funding of $50 million from Hillhouse Capital, Tybourne Capital and Ratan Tata earlier this year. According to CarDekho, the site lists around 1,400 dealers of new cars and more than 3,000 dealers of used cars receiving around 10 million hits a month.
On the other hand, CarTrade was just acquired by CarWale and had raised $30 million from Warburg Pincus, Tiger Global, and Canaan Partners in 2014. In early February this year, the firm claimed that they had four million unique visitors every month, and listings of more than 100,000 used cars in India.
Clearly, the online automobile sector is consolidating with the acquisition of CarWale by CarTrade and ZigWheels by CarDekho. In a media statement, Girnar Software, which operates CarDekho, claimed that it was planning to make up to five acquisitions for overseas expansion.
Moreover, Quikr turned up the heat in August this year by launching Quikr cars. While two-wheeler sales, test drives and auto loan facilities might be a few of the differentiation that zipzapwheels.com is bringing to the market, the verdict is clear:
To pace faster than established competitors in the market, one must explore newer verticals and be disruptive in their stance compared to the competition, have staggering metrics, and the backing of fuller pockets.