Over the route of CFT’s Moneyball series, one solution we frequently observed traders repeating to us whilst requested approximately what they search for in a great entrepreneur is that he/she should have a deep know-how of the hassle they are seeking to resolve.
Some may additionally name this response simplistic, but considering how frequently it receives repeated, it’s truely some thing worth exploring whilst speakme to new startups. And when CFT sat down with Ravish Naresh, CEO of Khatabook, it have become abundantly clear that Naresh sincerely empathised with the problem the corporation is trying to solve.
Khatabook is a cellular app that enables small shopkeepers and Kirana shop owners in India manage their books with the aid of supporting them track the debts to them through the means of a digital ledger. The service sends reminders on Whatsapp and thru SMS while it’s time for the service provider to acquire and facilitates keeps tune of due bills which historically had been completed thru writing in notebooks.
The merchant partners engage with the Khatabook carrier thru the app, which has Indian local language help, also consists of an choice of “Hinglish”. On the returned of this app, Khatabook has crossed over $1 Bn in transactions, 1 Mn downloads and on-boarded over 400K agencies organically in the beyond 12 months. The growth is particularly exquisite thinking about that a year and a 1/2 ago it handiest had 40K traders at the platform.
Khatabook Celebrating Small Town Business Values
The sizzling traction Khatabook has acquired is because the crew incorporates of sons of tier 2 cities and its shops.
Naresh, a IIT-Bombay alumnus, himself hails from Meerut in UP, even as Khatabook cofounder Jaideep Poonia is from Hanumangarh in Rajasthan and comes from a circle of relatives that runs a pesticides shop. Another cofounder Ashish Sonone is from Bilaspur in Chhattisgarh, while Dhanesh Kumar is from Jehanabad, Bihar and his family runs a cell accessories and recharge store. Finally, Vaibhav Kalpe who in the beginning built Khatabook, had the revel in of running at his father’s electrical shop in Nanded, a town in Maharashtra.
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Khatabook Raises $25 Mn In Series A Funding Led By GGV Capital
The Khatabook crew
The CEO stated that this is one of the primary motives for everybody at Khatabook to have a deep know-how of the troubles faced by means of traders which helped build the proper product blended with the truth that utility apps designed for India and that too for the smaller customers has no longer been carried out earlier than.
As consistent with a PwC study, there are about 12 Mn mother-and-pop stores in India and these Kirana shops constitute extra than ninety% of FMCG grocery income inside the united states.
Generating Real Value For Kirana Stores
“Last year, when Kalpe got here on board, the app already had 40K merchants but turned into very rudimentary; there was no backend, the front cease was simple however we had a tremendous preliminary starting base and we labored on meeting those deficiencies,” said Naresh who acqui-hired the group and was formerly the cofounder and COO of Housing.Com.
Unlike different systems which cater to the merchant network which spend plenty in getting downloads and installs, Khatabook used the electricity of phrase-of-mouth advertising to get their message throughout. This purchaser acquisition approach works due to the fact shopkeepers are much more likely to trust other shopkeepers approximately the financial savings and sales benefits of Khatabook. The shopkeepers are sent well timed reminders from Khatabook on WhatsApp approximately the due payments.
Once the shopkeeper begins using the app, their spending receivables go up by way of a thing of half of. So if a shopkeeper has INR 7 Lakh – INR eight Lakh excellent in dues from debtors, he can get again round INR 3 lakh- INR 4 Lakh again in exact time thanks to Khatabook’s provider, Naresh said even as explaining the version.
“This is something no ordinary app does, absolutely everyone is giving INR 100 coins lower back however INR three lakh – INR four lakh of real fee is some thing no person is growing,” said Naresh.
Tapping The Credit Market
Khatabook is part of the first cohort shortlisted beneath Sequoia Capital’s startup accelerator and incubation programme referred to as Surge, and the choice to be part of the program also happened sort of organically, Naresh said.
Naresh has acknowledged Prateek Sharma who is an investor at Sequoia Capital, from before and also Shailendra Singh, who's the handling director on the challenge capital firm, helped him on this adventure. “The level we had been in, we have been either going to apply for a Y Combinator Series A programme after which across the identical time Surge befell. It’s going sincerely correct with Surge; they move the greater mile. Prateek is supporting our group shift to Bengaluru,” said Naresh.
Khatabook has until date raised about $4 Mn (Pre-Series A) and counts Y Combinator, Info Edge and Sequoia as traders.
The startup presently does no longer have any monetisation plans and is focussed on consumer aggregation, in place of monetising the present offerings that it offers.
What Khatabook does have in the pipeline in terms of monetisation is offering financial services. “In the next 18-24 months we can target economic offerings that are apt for this section,” said Naresh, who additionally pointers at plans for supplying large set of offerings for those sellers, one that includes helping them spread the word about their shops. Case in point — virtual enterprise card, which the shopkeepers can percentage over Whatsapp which has a hyperlink to their Khatabook account.
The startup is also constructing its personal UPI-primarily based bills stack which it'll roll out to the service provider customers so that payments can manifest from within the app. “We don’t want to make money on bills due to the fact our consumer base is very rate touchy, some thing our cost, we are able to skip it on to the merchant,” Naresh introduced.
Currently, Khatabook is looking to rent greater people inside the engineering and development teams while also looking to build its records technological know-how crew to take advantage of the massive datasets it has collected.
The startup is also seeing customers from out of doors India, who now account for 10% of the user base from international locations along with Bangladesh, Pakistan, Nepal and a few October 01, 2019
Khatabook Raises $25 Mn In Series A
Khatabook has raised $25 Mn Series A spherical from GGV Capital, Partners of DST Global, RTP Ventures, Sequoia India, Tencent, Y Combinator and others.
This makes a total of $29 Mn in investment for Khatabook given that its inception in December 2018. The enterprise plans to utilise it for scaling up its generation team and building new products.
The round additionally noticed participation from more than 20 outstanding angel traders including the likes of Amrish Rau, Anand Chandrasekaran, Deep Nishar, Gokul Rajaram, Jitendra Gupta, Kunal Bahl and Kunal Shah.