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The on-demand hyperlocal delivery startup is present in 26 cities and has over 5,000 merchants on-board, says CEO Albinder Dhindsa

At a time when hyperlocal delivery services have caught the fancy of the Indian consumer, Grofers has cashed in on the opportunity to become one of the leading players in the space.

Started in December 2013 by Albinder Dhindsa and Saurabh Kumar, Grofers is an on-demand delivery service connecting consumers with their local merchants.

It partners with local merchants such as chemists, bakeries, grocery shops, organic food retailers and laundry services. Users can order a wide range of products from stores around them and get everything delivered to their doorsteps within 90 minutes.

Earlier this year, the startup nabbed US$35 million in Series B investment from Tiger Global and Sequoia Capital to fund its expansion plans.

In an email interview with e27, Dhindsa talks about competition and expansion and spills the beans on the company’s funding and acquisition plans.

Edited excerpts:

You are operating in a space where the likes of Big Basket and PepperTap are ruling the roost. What makes you different from them?

Big players lately have been trying to enter the online hyperlocal marketplace. An array of online grocery retailers and offline organised retailers are also trying to compete with us in this space. We believe that the service that will give a great experience to the consumer and solve a lot of the underlying infrastructure issues will win at the end of the day. So, product differentiation plays an extremely critical role in defining the business.

Grofers provides a platform to the local merchants, co-operates and helps them make the transition to online. Also, it adds a substantial amount to their revenues making our model unique.

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We hear that Grofers is planning to shift base to Singapore. What is the reason behind such a move?

We are not necessarily moving base to Singapore. Registering in Singapore is done with an eye to the future; this will help in our global expansion plans. It is easier to do this now when we are a small organisation. That said, we are very much focussed on India operations and this is our key market with our team still based here.

What’s your revenue model?

We don’t charge customers above the price they would pay in store, while merchants pay us a commission for the customers we bring to them and the deliveries we do for them.

Are you planning to expand operations to more cities?

We recently expanded to 16 more cities and now we are present in 26 cities in total — Agra, Ahmedabad, Bangalore, Bhopal, Bhubaneswar, Chandigarh, Chennai, Coimbatore, Delhi NCR, Hyderabad, Indore, Jaipur, Kanpur, Kochi, Kolkata, Lucknow, Ludhiana, Mumbai, Mysuru, Nagpur, Nashik, Pune, Rajkot, Surat, Vadodara and Visakhapatnam.

Our aim is to able to touch as many cities as possible.

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How much funds have you raised till date? Do you plan to raise more money?

We have raised a total of US$46.5 million in three funding rounds till date:

1. Seed funding: US$500,000 from Sequoia Capital and Deepinder Goyal, Founder of Zomato, in September 2014

2. Series A: US$10 million in February 2015 from Sequoia and Tiger Global

3. Series B: US$35 million in April 2015 from Sequoia Capital and Tiger Global

We are currently in talks to raise the next round of funding as well, but cannot share details.

Are you looking for acquisitions for expansion? If yes, is there any company on your radar right now?

In April 2015, My Green Box merged with us and that did strengthen different functions. Varun Khurana joined us as CTO.

As we are scaling up, we are in the process of acquiring Spoonjoy and Townrush. It is purely an acqui-hire. The respective teams have rich experience in building and running early-stage tech companies which allowed us to get hold of a large talent pool in one go.

Are you planning to increase your marketing and branding?

We recently launched our mass media campaign ‘We Get It’. It is aimed at young working professionals between 25-35 years of age who lead busy lives and value convenience. We want them to leave their daily chores to us and focus on other priorities in their busy lives. You don’t always get what you want, which is why we get what you need.

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Are there any plans to diversify beyond the grocery delivery business?

We started with delivering groceries and other daily needs in Delhi-NCR only. We now offer groceries, fresh fruits & vegetables, bakery items, pet care, baby care & personal care products, electronics, flowers and much more and recently launched in 16 additional cities to take our total to 26.

We recently entered the electronics, home appliances, and sports & fitness category.

We have now expanded to 26 cities with over 5,000 merchants on-board, providing 13o,000 products. We are a hyperlocal service providing goods.

How is the customer behaviour changing with the changes in the market?

The typical habit of weekend grocery shopping has become taxing because of tight working hours and an increasing need of convenience at the doorstep. The transition of traditional shopping method to shopping on-the-go has paved the way for the shift to online grocery shopping. Consumers have started valuing convenience. The intention is to become a hub of kitchen needs. Brands like Prestige add to the grocery shopping experience and solve the daily kitchen chores.

Do you see Grofers serving bulk orders like restaurants, sustaining B2B along with B2C, in future?

We are purely a B2C business. We do not cater to B2B deliveries. If a restaurant manager registers as a consumer, we’d deliver to the individual but we aren’t a B2B hub.

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