IIT, BITS graduates join hands to make e-commerce easier for sellers, turn profitable in 6 months
Delhi-NCR-based ScaleLabs enables cross-border e-commerce by helping sellers sell globally via online marketplaces.
At a glance
Founders: Kiran Kolisetty and Pramod Panchagnula
Year it was founded: 2016
Where is it based: Delhi NCR
The problem it solves: Enabling sellers to do business globally
Sector: SaaS / E-commerce
For the new generation of Indian entrepreneurs, there are a bunch of duos to look up to — Flipkart’s Sachin Bansal and Binny Bansal are at the top the list. The two friends from IIT-Delhi started up ten years ago, to bring e-commerce to India. The decade that followed witnessed startup revolution, which has made disruption the new norm.
In mid-2016, another duo – fascinated by e-commerce – started up in Hyderabad. The aim was to enable cross border e-commerce by helping sellers sell globally via online marketplaces. Less than two years since launch, this startup has made a huge impact on online sellers inside and outside India. This is the story of their journey.
Kiran Kolisetty and Pramod Panchagnula, both now 24 and natives of Hyderabad, have been friends since school. They went on to pursue engineering at two of the most prominent institutes in India – Kiran went to IIT (ISM) Dhanbad and Pramod to BITS Pilani.
In his third year at college, Kiran started up with a retail brand in khadi fashion. Exiting within two years by selling it to an international brand, he was inspired to build a business which could be more scalable.
He knew from experience that there was a growing demand for Indian products and brands in international markets. So, he decided to start up for enabling sales of more such products and brands across global markets.
At the time, Pramod had finished graduation in electronics and spent three years working in payments, telecom, e-commerce, and retail sectors, specialising in data and analytics. He has worked for PayPal, Petco, Samsung, and Qualcomm — covering business insights and intelligence across B2B and B2C functions.
When Kiran shared his idea for solving cross-border e-commerce for small and medium-sized sellers and merchants with Pramod, he immediately got on board.
Drawing the plan
E-commerce (B2B and B2C) worldwide sizes up to $2.3 trillion according to Statista.com. However, most small sellers and brands tend to participate only in their respective domestic markets, via local e-commerce marketplaces and platforms. These sellers, due to the lack of financial capital, know-how, awareness and expertise, get deprived of the opportunity of selling globally.
When Kiran and Pramod started up, their objective was to scale up the businesses of brands and sellers by facilitating cross-border commerce; hence, their company was aptly named Scale Labs.
Scale Labs facilitates global e-commerce for sellers and brands with the help of technology and fulfillment solutions for marketplace, payments, logistics, and cloud-based SAAS Suite. It helps sellers manage catalogue/listings, inventory, orders, logistics and payments on online marketplaces across the globe. Analysing global e-commerce demand and supply trends, they draw actionable insights for their clients and partners.
Although they started up in their native place Hyderabad, Kiran and Pramod soon moved to NCR as most of their clientele — sellers and brands — were based out of Delhi.
They initially expected that making the brands and sellers believe in their services would be difficult, given they were new to the business. “But that turned out to be a cakewalk for us as our clients shared our belief,” says Pramod.
In fact, their biggest challenge was hiring the right talent with limited resources. “We all know that startups manage very short deadlines. Most of them think they can hire the A+ player in a snapshot. But real life is different because detecting the best talent for your project is a mix of experience, practice, analysis, and strategy,” he says.
Today, the founders work with a team of 36.
Scale Labs is focussed heavily on top line growth and keeping the bottom line positive. Equally important to them is adoption rate — which is the number of sellers that were able to achieve a threshold of incremental orders across global marketplaces.
Maturing and expanding
Kiran claims that Scale Labs has helped grow their clients’ business by up to 75 percent. “The sellers who work with us are new to the concept of cross-border e-commerce; hence, a lot of our time and effort goes to educate the market. Our sellers respect us for the services we offer them and also value the relationships we have built with them,” he says.
“What differentiates us is our focus towards the long and mid tail – helping small and medium sized sellers and merchants to establish a strong global presence. We aim to help grow the business of SMBs, which in turn will help in providing employment opportunities,” he adds.
Bootstrapped so far, Scale Labs closed the last financial year with a small profit. It aims to maintain unit level economics. After reaching profitability six months into the journey, it has reinvested the profits by expanding its team.
Although a few companies have built multi-channel e-commerce solutions, their scope is limited to mostly Indian e-commerce marketplaces. In India, Pramod says that Scale Labs has no competitor.
Plans for 2018
The global cross-border e-commerce market will grow to $1 trillion in 2020 according to Statista.com. Today Scale Labs enables cross border e-commerce not only for Indian sellers and brands, but also international sellers and brands to sell outside their core domestic markets.
Kiran says, “At present, we are driving cross border trade from India, Sri Lanka and Bangladesh to the rest of the world. Soon, we aim to bring brands and sellers from the APAC region and help them sell their products across the globe via global marketplaces such as Amazon, Lazada, Wadi, Souq, and many more.”
Scale Labs enables its clients to sell their products to over 20 marketplaces globally. This year, it aims to continue expanding supply base and strengthen demand side, along with adding useful features to its SaaS product suite.
The startup is working with more than 250 brands, including Sanjeev Kapoor’s Wonder Chef, Denver perfumes, Swiss Military, Satya Paul, Mayank Modi, Classic Polo, Sukkhi Jewelry, Pipa Bella, Pretty Secrets, Miss Chase, etc. It also plans to expand its seller base in India and increase the categories of products, along with expanding to South East Asian market for seller acquisition.