1K Kirana, an Indian startup running a hyper-local shopping app of the same name and a retail distribution network, has raised $25 million in a new round of funding as efforts to expand reach of nearby brands and stores to consumers.
The three-year-old startup’s Series B funding is led by Alpha Wave Global, Info Edge Ventures and Kae Capital. Several angel investors including Amrit Acharya, founder and chief executive officer of Zetwerk, are also involved in what the startup says is the first tranche of a larger funding round.
Neighborhood stores dot tens of thousands of cities, towns and villages in India. They have survived – and thrived, despite – the multi-billion dollar investments of the retail giants in the country. But they struggled with securing large volumes of inventory and good prices.
1K Kirana trying to solve it with a multifaceted approach. The startup acts as a distribution network for these stores and also helps them with digital marketing to reach more consumers. 1K Kirana also operates an app for consumers, which they can use to discover, order, and pay for their purchases.
“We control their entire supply chain. We supply them, we do the marketing, and we guarantee that the number of consumers who come to the store will increase. Kumar Sangeetesh, co-founder of 1K Kirana, explained in an interview with TechCrunch.
Consumers can either have their orders delivered to their door or pick them up from a nearby store. If they have ordered an item that is not available at the store, 1K Kirana will deliver it to the store.
Most of the items that the neighborhood stores sell are in the FMCG category. The challenge of operating in this category is that store owners make a single digit profit moving these items. The industry agrees it’s a problem worth solving because these stores move most of their inventory, so reaching them – and through authorization, their consumers – is very important to everyone’s success.
What 1K Kirana is trying to do, on a fundamental level, is help these stores dramatically increase the number of items they sell, so that it’s possible for them to scale. At the same time, 1K Kirana is serving consumers, giving them access to a larger catalog, more selection across categories, and discounts.
“In our case, I aggregate the supply needs of the stores, go to the manufacturers, reduce the cost and pass the cost benefit to the consumer,” said Sangeetesh, who added that 1K Kirana is not a kirana tech startup, but a Phat consumer.
“The kind of impact that 1K has made in such a very short amount of time on the lives of consumers and franchisees alike is incredibly difficult to achieve. The 1K Mall app has enabled thousands of non-urban Indians to shop online for the first time,” said Kitty Agarwal, Info Edge Ventures Partner, in a statement.
“We believe the 1K team is building an iconic company that is changing the way stores in non-urban India serve their day-to-day needs by expanding their selection with a wide range of options. Choose higher quality, affordable price. The founding team has excelled in their execution and we are excited about strengthening our partnership with them. “
1K Kirana says it has served over a million customers across more than 25 districts in Delhi, Haryana, Rajasthan and Uttar Pradesh. It plans to deploy new funds to hire more tech talent to expand to expand the reach of 1K Kirana to more than 100 counties, he said.
“Sangeetesh, Abhishek and Sachin have built a business that combines strong growth with compelling unit economics. We are delighted to partner with them as they bring a modern retail experience to underserved consumers in India’s more than 600 billion dollar grocery market,” said Navroz D. Udwadia, who founder and partner of Alpha Wave Global, said in a statement.
This is an evolving story. More to follow…
