A Bangalore-based B2B e-commerce platform ShopX has raised USD 35 million from Hong Kong-based Fung Strategic Holdings. The three-year-old startup connects retailers in small towns with FMCG brands.
"It’s an exciting time in the industry and our investment in ShopX comes on the heels of a series of investments that Fung Group has made in new, disruptive technologies that are transforming supply chain and retail,” said Rajesh Ranavat, executive director, Fung Strategic Holdings.
Founded by Amit Sharma and Apoorva Jois in 2015, ShopX is currently present in 300 Indian cities and claims to have partnered with 50,000 small retailers. The fresh funding will go into strengthening its products and engineering teams. It also plans to expand to a million small merchants and build new offerings covering multiple product verticals.
"We are keen on building a globally transformative company out of India, and one with a deep product and technology-led culture. Having the right investors in an ambitious venture like ShopX is paramount,” said Amit Sharma. Founders claim 90% of the retail in India constitutes small merchants from tier II and III cities, while the rest are e-commerce, large format retail and supermarkets. The company digitally enables retailers and traders, while partnering with FMCG and electronic brands to digitise their distribution system.
The Fung Group operates across the entire global supply chain for consumer goods including sourcing, logistics, distribution and retail. “As we plan for hyper-growth, we are extremely excited to have a global supply chain leader like the Fung Group as our strategic investor. We expect deep synergies in the areas of supply chain orchestration, global sourcing, introduction to new brands and overall retail distribution,” Sharma said.
In an earlier round Infosys co-founder and former UIDAI chairman Nandan Nilekani, had invested USD 18 million. “The ShopX model provides small retailers the same cutting-edge technology and supply chain solutions that any established e-commerce or organised retailer has access to. ShopX has been built on scalable and sound business principles like platform thinking, capital efficiency and a sustainable growth model,” said Nandan Nilekani.
Ranavat from the Fung Group believes the opportunity that ShopX has will make it “a pioneer in terms of creating the future of what’s possible for the retail ecosystem in India from the consumer to the supplier, retailer or brand. We’re proud to be their strategic partner and we’re very excited at the potential growth ahead,” he said.
Other players in the B2B retail sector include Jumbotail, Just Buy Live, Udaan, etc. Earlier this year Udaan raised USD 50 million in Series B funding round from Russian technology investor Yuri Milner and Lightspeed Ventures. While Jumbotail raised USD 8.5 million from Kalaari Capital in 2016, Just Buy Live reportedly shut down after raising USD 20 million from Alpha Capital in early 2016. According to data tracking platform Tracxn, there are over 550 e-commerce companies in the B2B sector dealing in consumer goods, industrial products, agriculture, etc.