ShopX, a startup that works in the assisted ecommerce space, has received funding from Nandan Nilekani to the extent of $2 million (Rs 13 crore). Almost the whole of around $18.6 million (Rs 122 crore) that ShopX has raised since its inception three years ago, has come from Nandan Nilekani.
The online-to-offline model of business is gaining currency in the Indian startup ecosystem. Technology is being effectively used to leverage the infrastructure already in place to marry the reluctant online buyers and the merchant establishments who are not keen to go online with their merchandise.
ShopX has officially confirmed that this lot of $2 million is not any fresh round of fund raising, but a part or a tranche of an earlier round. The shares have been allotted at an average price of ₹34,561 each.
On the model of business being adopted by ShopX, the company would like to call it “omnichannel/digital offline industry”. It has set as its objective lifting the current level of 50 million online buyers in the country to 400 million through its retail app. The app has some 49,000 shops and small retailers listing their products and the consumers can download the app and order the stuff. The retailers will then be advised of the order and they will make the delivery and collect the payment. ShopX is present in 230 cities across 10 states and is servicing 6.8 million customers.
There are other startups working on similar lines like ShopX IndiaBuys, StoreKing, IPay. Even the established players like Flipkart and Myntra have initiated moves to set up offline stores to expand their online business.
The fact that there are studies to show that the average customer prefers to pay cash on delivery has spurred the growth of this O2O model.
Coming back to Nandan Nilekani as an investor, the startups he has already invested are Power2SME, Printline Media, ShopX, RailYatri, Drishti Eye care, SEDEMAC, Tracxn, LetsVenture and Mubble. These investments are made either as an angel or through his investment vehicle Fundamentum.