Online marketplace for pre-owned furniture and appliances Zefo has raised Rs 60 crore in Series B from existing investors Sequoia India, Beenext and Helion Ventures. The Bengaluru-based startup plans to focus on core operations, including warehousing and logistics.
Zefo was founded in 2015 by Rohit Ramasubramanian, a former Helion Venture Capital executive, IIT graduates Karan Gupta and Himesh Joshi, and ex-Flipkart and ex-Amazon executive Arjit Gupta. Last year they raised Rs40 crore from the same investors.
Although they started with pre-owned furniture and large appliances, three months ago Zefo also launched the mobile phones category. Rohit told YourStory that Gozefo wants to build on this category by replicating the learning from the other two categories.
The Zefo team currently includes 200 people, and wants to now expand their technology and product departments.
Zefo currently serves Bengaluru, Mysore, Delhi, Gurgaon, Noida, and Mumbai. Rohit says the company is not planning expansion into any more cities for at least the next 6-9 months. “We want to focus on getting more sales and be more efficient in the cities we already exist in,” he says.
In 2016, Zefo had 20,000 customers; today the number is 1,50,000 at a 30 percent monthly growth rate.
Abheek Anand, Principal, Sequoia Capital India Advisors, said in a press statement, “Sequoia India is very pleased with how Zefo has addressed a white space in the online used commerce market. This is a massive, underserved market where current alternatives do not work well in the Indian context. Zefo’s managed marketplace approach appeals to both buyers and sellers, and their strong growth is a testament to the product-market fit that they have achieved.”
According to Rohit, consumer adoption is growing for the pre-owned goods’ market, as trust is built with quality checks for each product, including processes for disinfecting and refurbishment.
“This is an operationally complex model. For second-hand products, India has a low-trust market. But unlike a classifieds page – which only connects buyers and sellers - we enable quality checks, transactions, logistics, refurbishing, cataloguing etc.,” Rohit adds.
Zefo also offers a buy-back guarantee on its products - where it offers up to 70 percent of the price back when their users sell the products back to Zefo. Currently, they have more than 10,000 products across categories like beds, sofas, dining sets, wardrobes etc in furniture; TVs, washing machines, refrigerators and air conditioners in appliances; and mobile phones.
Zefo has already tied up with online furniture sellers Pepperfry and Urban Ladder and online horizontal marketplaces Flipkart and Amazon for exchange programmes. Those customers can sell their old furniture and buy new ones for a discount from these platforms, and Zefo will take that inventory from these marketplaces under a B2B tieup.
Zefo has also tied up with brands like Godrej, Videocon, Micromax, Whirlpool, and HomeTown for factory seconds and exchange offers.