B2B retailtech startup Arzooo has raised $6 Mn from the venture debt fund Trifecta Capital as it aims to hit a sales run rate of $500 Mn in 2021.
Founded by Khushnud Khan and Rishi Raj Rathore in 2018, the Bengaluru-based startup provides a retail technology platform that enables retail stores to operate more efficiently and increase sales, a tough proposition as most of these entities have to compete with big ecommerce players such as Amazon, Flipkart and ShopClues or vertically integrated startups like Zefo. Arzooo currently has more than 7,000 partner stores on board and operates in 10 Indian cities, including Bengaluru, Delhi-NCR, Chennai, Mumbai, Gujarat, Kolkata and Hyderabad, among others.
The company said it would use the fresh capital to ramp up its supply chain infrastructure with technology and operational capabilities. It will expand the network of partner retailers and serve 50,000+ retail stores, helping them improve the speed of delivery, service experience and operational efficiency.
“Neighbourhood stores are a fantastic channel to drive digitisation, inventory expansion and price competitiveness over online retailers. Arzooo has seen a strong demand recovery post the Covid-19 lockdown. We look forward to continuing supporting them as they grow their footprint going forward,” said Rahul Khanna, managing partner of Trifecta Capital.
Arzooo has raised a total of about $14 Mn, with about $7.5 Mn coming in the Series A round led by WRVI Capital. Announced in October 2020, the round saw participation from existing investors 3Lines Venture Capital, the UAE’s Jabbar Internet Group and others. It also raised an undisclosed amount from Zoom meeting app’s founder Eric Yuan and Silicon Valley’s venture capitalist Bill Tai in November 2020 to ramp up its B2B platform ‘Go Store’.
Last year, the retailtech startup announced the launch of its digital credit lending product ‘Arzooo Credit’ to help offline retailers meet their working capital requirements. The product offers INR 1-10 Lakh worth of credit to sellers.
According to a NASSCOM report, organised retail and ecommerce in India is expected to grow 3x by 2024 while unorganised retail is estimated to grow 40%. The report also notes that talent in the retail sector will play a crucial role in successfully digitising the industry.