Online marketplace for food and grocery Jumbotail announced on Thursday that it had raised $8.5 million in Series-A funding from Kalaari Capital and Nexus Venture Partners.
Jumbotail claims to serve thousands of wholesale customers such as kirana stores and HoReCa (Hotel/Restaurant/Café) businesses in Bengaluru. Nexus Venture Partners had earlier invested $2 million in the venture. The startup plans to utilise the Series-A funding to further strengthen its technologies and enhance operational capabilities.
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Founded in November 2015 by Stanford alumni S. Karthik Venkateswaran and Ashish Jhina, Jumbotail's vision is to organise the food and grocery ecosystem in India using technology, data science and design. Jumbotail offers a selection of products, including staples, spices, dry fruits, packaged foods, and FMCG products.
Sellers (traders, manufacturers and brands) can list their food, grocery and FMCG products on the Jumbotail marketplace, which is accessible to customers through a mobile app available in four languages - Kannada, Malayalam, Hindi and English. According to the company website, the app currently is in beta mode.
Jumbotail also provides full-stack services, including storefront delivery and payments collection for its sellers, as well as working capital credit from third-party credit providers, to its customers using transactional data and proprietary algorithms. Ashish, Co-founder & COO, Jumbotail, said in a statement,
Manufacturers and brands can instantly get direct and highly targeted access to thousands of retailers and institutional customers through the Jumbotail platform without needing to invest in expensive physical distribution networks. Jumbotail also opens up the kirana network to financial institutions looking to extend credit in a cost-effective and scalable manner.
Talking about the sector, Bala Srinivasa, Partner, Kalaari Capital, added, “About 98 percent of India’s food and grocery consumption is via kirana stores. Jumbotail brings tech-centric innovation to address inefficiencies in terms of product discovery, distribution costs, stock outs, and pricing."
Talking about the market size and sector, Karthik, Co-founder & CEO, Jumbotail said in a statement,
While this is a multi-billion-dollar market opportunity, it requires us to solve challenging problems that are so unique to India that copycat models will not work. We are putting our customers first and building technologies and supply chains that will work for the next billion Indians in distributed, chaotic and unstructured environments.
June 2017 saw one of the biggest consolidations in the grocery space as Amazon announced that it had acquired, supermarket chain Whole Foods for $13.7 billion. Closer home in India, speculations have been rife of Amazon looking to acquire e-grocery startup BigBasket. Amazon India also operates Amazon Now, a 'two-hour delivery services for grocery needs' in partnership with platforms like Big Bazaar, Spar etc.
Disclaimer: Kalaari Capital is an investor in YourStory.