FYND Co-founder denies acquisition by Reliance, says it is in talks with several investors
L to R: Farooq Adam, Sreeraman MG, Harsh Shah.
Refuting rumours that it is being acquired by Reliance Group, omnichannel shopping startup FYND has stated that it aims to continue as an independent entity. Mumbai-based FYND is an online shopping app that connects local retailers to the consumer. The B2C marketplace reduces delivery time from days to hours.
Speaking to YourStory, FYND Co-founder Harsh Shah said that although they are in talks with multiple parties, including the Reliance group, for investment, the team is not looking at being acquired.
“Quite a few VCs have also reached out to us regarding funding. But all these talks are in initial stages, and no deal is confirmed yet,” Harsh added.
It was in late January that India’s richest man announced that his company, the most valuable in India with a market capitalisation of around Rs 8 trillion, is entering ecommerce. Mukesh Ambani, Chairman and Managing Director of the Reliance Group, said that the company’s “new commerce” foray will combine the group’s offline retail network of around 10,000 stores with the online reach of Reliance Jio (280 million subscribers).
Since the announcement, the industry has been speculating how this will impact the big players and retail altogether.
What's in it for Reliance?
Reliance has been building a wide range of businesses over the years, and ecommerce is a logical extension. Yet, there are different capabilities to be built, especially in tech, for enabling online commerce.
With FYND, Reliance can achieve the collective momentum of offline and online sales. Usually, when unable to develop new capabilities, large companies look for acquisitions.
Devangshu Dutta, Chief Executive at Third Eyesight Consulting, said, “More often than not, it is the small companies (not the large ones) that produce innovative products. It is better done outside the existing infrastructure in a large company; that environment exists in startups.”
Even Google, the world’s largest tech company, has acquired more than 200 companies.
Devanshu pointed out that strategic investment by large companies in startups often lead to the former acquiring the latter. He believes that since retail in India is a fragmented sector, it makes it ideal for a platform like FYND to grow. “But it is expensive and time consuming to build market share in retail. Even Flipkart and Amazon have had to give deep discounts to acquire customers,” he added.
FYND’s rapid growth
Harsh claims that FYND has seen massive growth in the past 6-7 months, with their GMV growing 7x this year. In this fiscal, FYND has had Rs 4 crore to 5 crore monthly revenue. Their clients have increased from 220 to 500 in the last few months.
FYND has also expanded its reach in the lifestyle sector, with focus on beauty, furnishing, and kids. As Devangshu rightly pointed out, this provides a great opportunity to Reliance. “Once you get the framework right in tech and business, it can be applied across sectors,” he said.
Additionally, FYND recently launched Open API feature to leverage FYND’s real-time inventory integration with over 200 brands and 8,000 stores, and makes it easy for businesses to build an omni-channel ecommerce app. Harsh said that FYND is the choice for brands that do not want to keep stock in warehouses.
“We have branched out quite a bit in the last one year. Our aim is to enable offline retailers to discover the online world. In terms of consumer data, we don’t use the offline data a lot. Most of the data we use is from our platform. We don’t even have a lot of advertisements,” he added.
FYND’s long saga
Founded by Farooq Adam, Harsh, and Sreeraman MG, FYND has raised more than $7 million from investors including Google, Kae Capital, IIFL, Singularity Ventures, and GrowX, among others.
FYND has undergone major changes since its launch in 2012. At the time, it was called Shopsense, which provided brands with different products to improve customer experience. Clients had included Lee, Satya Paul, Anita Dongre, Flying Machine, and Being Human (along with other 330 brands, these are still FYND’s clients).
In early 2016, Shopsense became FYND, to scale up the business with more avenues. Their products, such as FYND Market Place, and FYNDStore, help retailers save sales which they may otherwise lose due to lack of stock of a product. For brands, FYND saves warehousing costs, and stock transfers within stores. It provides fast delivery (in 2-3 days) as products are picked up from the stock point nearest to the customer (most of the orders are fulfilled from the same state).
The FYND app has had more than 10 million downloads, and 1.5 lakh visitors on the website every month.