This B2B startup connects small manufacturers with brands to help them scale up
Mumbai-based B2B startup Groyyo connects manufacturers with lifestyle brands, offers automation and technology to boost efficiency, and helps organise the fragmented small-scale industry.
The last 24 months have transformed the way small businesses look at technology. From being a good to have, investing in technology tools is now seen as a must-have.
What changed? Digitisation allowed medium and small sized businesses (MSMEs) to survive in the pandemic era, allowing them to scale quickly and efficiently. Those that couldn’t lagged significantly.
Even today, many small businesses aren’t equipped with the resources, know-how, and planning to transition to digital.
B2B manufacturing growth platformis solving this problem for the lifestyle segment.
Founded in July 2021, the startup works with MSMEs in apparel, footwear, accessories, furnishings, ceramic, beauty, and furniture categories, and aims to “empower the 20 million+ micro-manufacturers across Asia and give them an opportunity to take their business global”.
The Mumbai-headquartered startup raised a seed round of $4.6 million earlier this month led by Alpha Wave Incubation (AWI), which is backed by DisruptAD, ADQ’s venture platform, and managed by Falcon Edge Capital.
Two of the three co-founders, Subin Mitra and Pratik Tiwari, worked together at Zilingo, a tech platform for the fashion industry. Subin is the Chief Executive Officer and Pratik is the Chief Operating Officer at Groyyo. Ridam Upadhyay, the third co-founder and the Chief Technology Officer, has worked with Flipkart and Udaan during their early years.
The Groyyo advantage
Apart from equipping manufacturers with technology, Groyyo helps them find demand and buyers, and fill in their unutilised capacities. The startup also helps them work on physical standardisation of products and digitisation of factory floors.
“This becomes very important because this is a space where there is zero technology, as of now,” Subin said.
Most of these factories are family-oriented businesses, and it is about “hand-holding them and introducing that initial layer of technology”.
Groyyo also helps these manufacturers procure raw materials in an optimum and cheaper manner from India and Bangladesh.
“So, for a manufacturer, we become an end-to-end service, where we help them boost demand, improve the factory floor, and procure raw materials,” the co-founder said.
Groyyo operates on a take rate-based model and also charges a commission from manufacturers to bring in orders. It has about 50-60 customers at the moment.
For customers at the other end, such as a fashion brand, Groyyo proposes to be a one-stop sourcing destination for anything they want.
“We become their one-stop source and destination not just to find factories, but to also find factories that are compliant, digitised, and with execution assurance that orders placed will reach their warehouse on time,” Subin said.
Focusing on manufacturing clusters
The company works across eight manufacturing clusters in India and Bangladesh, with more than 250 businesses associated with it. These clusters are usually famous for a particular kind of product, for example, Panipat, which is renowned for bedsheets and curtains.
Groyyo first identifies the clusters it wants to expand into, based on the product capability it wants to build. The team then approaches manufacturers–usually within the revenue range of Rs 20-50 crore– in the identified clusters to help them to reach out to more and more buyers on a global scale.
It approaches brands once they have the right supply to cater to them.
“What that means is that the moment you (buyer) give us a request, we can turn that around with very fast turnaround times,” Subin said.
Groyyo helps them identify the right manufacturers, providing real-time visibility and updates on the order with the digitisation they are applying at the other end.
The B2B startup relies heavily on local experts to source the right kind of materials and find manufacturers who can meet their standards.
“These people have years of experience in the industry, and are mostly NIFT and NID graduates. So, they really understand this model well and are well-versed with how this industry operates,” he said.
In the last six months, the company has grown to a team of 50-60 people across Mumbai and Delhi.
Groyyo allows factory owners to track everything that is happening in a factory, from different requirements of multiple buyers to the status of every order. They can track inventory and plan accordingly too.
“That is a critical insight, because the factory owner is the one who stands to lose the most if an order is delayed. He will lose his customer and face penalties,” Subin said.
Groyyo has made the product easy-to-use, keeping in mind the experience of its users.
“The Groyyo app is very easy to use. Even somebody who is not from the manufacturing ecosystem can open the app and figure out how to use it,” he said.
It helps buyers find manufacturers with the right kind of compliance product capability that they need and track the status in real time, making day-to-day operations easier.
Future and more
Groyyo is aiming to reach about 500-600 manufacturers by the middle of this year, which would be two times its current capacity.
The $120 billion MSME industry is expected to grow five times, according to the company.
“We believe product sourcing is a global challenge with massive opportunities across both demand and supply,” Anirudh Singh, Managing Director, Alpha Wave Incubation, has said at the time of funding. “We really liked the supply first approach adopted by Groyyo, which helps them cater to a multitude of categories and products to serve buyers across the globe.”
“Additionally, we also think Groyyo’s solution will give a fillip to South Asia’s rising small manufacturer segment, which is hungry to work with large-scale clients,” he added.
With its latest funding round, the company plans to build its teams across key manufacturing clusters in South Asia along with expanding its presence across the US and the Middle East. It will also invest in the technological and physical upgradation of its manufacturing partners.
Edited by Teja Lele