Rural e-commerce company StoreKing expands its reach, raises $16M funding from Axiata Digital
StoreKing, the assisted e-commerce giant with a rural focus, has raised $16 million in funding from Axiata Digital, a subsidiary of Axiata Group Berhad. This is Axiata’s first investment in Indian markets.
Parented by LocalCube Commerce Pvt Ltd, StoreKing, started in 2012, has now expanded to over 1,200 towns. It is a simple e-commerce model albeit with a vernacular interface and actual physical touchpoints, to help on-board rural consumers onto the digital revolution.
The company gets in touch with any retail store – be it a mobile store or a kirana – in the village, and convinces them to buy and install a StoreKing tablet or a kiosk in the store. The tablet contains the app that is loaded with over 80,000 products that the retailer helps the customer browse through, select a product and pay forit. Once the order is confirmed, the customer pays the retailer in whole and receives an SMS (in vernacular) from StoreKing. It only costs the retailer a little less than Rs 10,000, to install the device at his store, and he also receives 6-10 percent commission on sales made.
“We find a trusted retailer who is known in the village so that people come to him to buy the things they want to and are willing to pay in full toward the product,” Sridhar Gundaiah, Founder and CEO of StoreKing, had explained to YourStory in an interview. “The only thing we need from the customer to identify them is a phone number. We send all delivery communications to his mobile after that,” he had said. In turn, StoreKing, with its warehouse in Bengaluru, delivers all items within 48 hours, and uses the FMCG distribution channel to deliver it goods.
“From the beginning, our goal was to help thousands of small businesses in rural India achieve a brighter future, by enabling them to use technology. We hope to benefit from Axiata's experience in extensive geography-based services and we couldn’t thank them enough for investing in the idea of StoreKing,” said Sridhar, of his partnership with Axiata.
The service has grown from 400 StoreKing retailers during the first year of operation to over 16,000 mobile kiosks, with a network of kirana stores across south India. It currently delivers over 1.5lakh orders every month, to a customer base of over 10 lakh. They have also established over 650 master franchisees, across eight southern and western States of India, namely Tamil Nadu, Kerala, Karnataka, Andhra Pradesh, Telangana, Maharashtra, Madhya Pradesh, Orissa and Gujarat. StoreKing offers physical products in the FMCG, electronics categories, and digital services like mobile or DTH recharge, insurance and more.
Targeting retailers in Tier IIIand IV cities, StoreKing has also partnered with mobile wallet companies to enable cashless payment at all its retail stores in rural India. Amazon India also recently announced a partnership with StoreKing, to replicate this model, in order to take their footprint to rural markets.
“StoreKing has a very wide rural presence in south India and it will help us tap a new customer base. They also have existing logistics capabilities, which we will use to deliver products,” Kishore Thota, Head of Consumer Marketing, Amazon India was reported saying in a Livemint article.
“StoreKing has created a platform that solves the fundamental constraints in our markets with last-mile logistics and payments, while building trust amongst mass market consumers. It is pivotal in bringing the rest of our consumers into the digital sphere,” said Mohd Khairil Abdullah, CEO, Axiata Digital.
The company has raised multiple rounds of funding in the past, totalling around $6 million from a Luxembourg-based VC firm Mangrove Capital Partners. This is their largest round to date, and with the newly-raised funds, StoreKing aims to expand its reach one lakh retailers by 2017, and upto 2.5 lakh in 2019.