Snapdeal, one of India’s largest e-commerce players, is investing $100 million (about Rs 665 crore) in Shopo, the commission-free marketplace it acquired two years ago and re-launched in July 2015.
Kunal Bahl, co-founder and CEO of Snapdeal, said that the investment will go towards strengthening the Shopo brand and upgrading its technology to make it easier for small and medium business to list and connect with potential customers. The Gurgaon-based online retailer will also help sellers with payment gateways and logistics.
Snapdeal’s rivals Flipkart and Amazon are racing to widen their base of sellers as they compete for higher share in an intensely competitive market. With its commission-free model, Snapdeal hopes to get more sellers onboard Shopo, a mobile-only marketplace, where they can list without going through a verification process or official documentation.
“Look at the Taobao model, we are just like them. We can look at options like advertising to make money. The idea of Shopo is to bring online as many sellers as possible,” said Bahl in a PTI interview, referring to the Alibaba-owned marketplace that enables small, individual sellers to open their online shops. Alibaba is an investor in Snapdeal, which raised $500 million in its latest round from the Chinese e-commerce major, Japan’s SoftBank, and Taiwan’s Foxconn.
India is being viewed by investors as the last unconquered expanse for e-commerce. According to Bahl, the Indian e-commerce is set to grow eight-folds to $250 billion in less than a decade, which would be faster than the existing robust growth of online retailing in China. Indian e-commerce sector was valued at $17 billion as on December 2014 in a joint report by industry body Assocham and consulting firm PwC.
Founded in 2010, Snapdeal has over 25 million subscribers and 150,000 businesses selling on its platform that makes it one of the top three online retailers in the country along with Flipkart and Amazon India.
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