SUMMARY
Accel Partners and Shunwei Capital participated in the Series B funding round
The company plans to onboard 100K influencers in the near future
With the Series B funding, it will be adding support for more languages
With increased penetration of smartphones along with cheaper internet plans, Indian ecommerce has seen rampant growth in the past half a decade. According to an IBEF report, ecommerce in India is growing at a compounded annual growth rate of 51% from 2017 to 2020 which is one of the highest in the world.
But when compared to the overall retail industry of India, ecommerce still falls apart far behind as the majority of India, especially in Tier 3 cities and beyond. Smaller brick and mortar stores still constitute the commerce in these parts. This clearly highlights that there’s still a long way for ecommerce to enable everyone to shop online.
However, in the last two-three years, a new phenomenon has taken most Tier 2 cities and some Tier 3 markets by storm. The whole concept of online shopping has been spiced up by social commerce and video commerce, with most of the success coming from the younger Tier 2 cities as well as Tier 3/4/5 cities.
Banking on the power of social media and short videos is New Delhi-based SimSim, a video commerce app. Launched just seven months ago, SimSim has announced raising $8 Mn in Series B funding round from Accel Partners and Shunwei Capital. In an earlier round SimSim had raised $6 Mn from Good Capital and Accel India and Shunwei Capital in November 2019.
Founded by Amit Bagaria, Kunal Suri, and Saurabh Vashishtha in June 2019, SimSim is a video commerce platform which sells products online through a video catalogue. Similar to other online marketplaces, SimSim lists and sells products from third-party sellers on the platform. However, the catch here is that instead of being a simple online marketplace, the startup is banking on videos to reach more customers, engage them in a more meaningful manner and thereby get them to shop again.
SimSim has partnered with influencers whom it calls ‘Community Opinion Leaders’. These influencers produce and upload informative videos related to the products sold on the mobile-first platform. Instead of going to the description segment of the product, SimSim’s users get information through these videos.
Speaking to Inc42, cofounder Bagaria said influencer videos help users relive the experience of buying products from a store.
“The idea here is to mirror everything which is happening at a retail shop,” he added.
The company doesn’t look at influencers as just content creators. Rather, SimSim believes that they are microentrepreneurs. “Our work essentially is to provide them with the right customers, the supply, payments, logistics and the technology tools,” Bagaria added.
SimSim’s Secret To Success: Vernacular First
In the recent past, many direct-to-consumer (D2C) ecommerce platforms have boosted their reach with more regional language support; SimSim’s approach to increasing sales has also been the same. While initially, SimSim supported English, Hindi, Tamil, and Bengali, Bagaria said the new funds will help it add more languages on the platform. “We’re planning to serve our customers in 20 languages,” Bagaria added.
He added that most ecommerce platforms are English-first, and people in small towns and cities find difficult to understand the terms and conditions as well. SimSim helps these users get relevant information in their own language.
“As these influencers speak the language of our customers, it helps SimSim to gain their trust,” Bagaria added.
Another factor driving ecommerce sales is the greater focus on the user interface (UI) and user experience (UX). For SimSim, this task was a major challenge, Bagaria admitted, as the company has three platforms — a customer-facing platform, one for influencers and a seller platform.
Bagaria said that in the initial phases, the company also had challenges finding the right tech talent. This will be another focus area for the company in the new year as it looks to improve its technology backend and it will invest some part of the recently raised fund towards it as well, Bagaria added.
Tapping The Influencer Network
Perhaps the biggest challenge for most social commerce platforms is keeping the network alive. SimSim faced this in the early days when it tried to expand its influencer network. Bagaria said that it was quite difficult to convince influencers about their roles. But once the platform was up and running it became easier for the company to widen its influencer network, he added.
Besides investing funds to add more languages and technology, Bagaria said that the company will also invest in adding more creators and influencers. While the platform has close to 1200 influencers currently, SimSim plans to have 100K social sellers in the next 12 months.
The Numbers Game
While ecommerce is a tough nut to crack, and investors hesitate in backing ecommerce startups because of the cash burn and long road to profitability, Bagaria claims SimSim has already started making a profit on every order. Without revealing the exact numbers, Bagaria claimed that in the last quarter, the company has grown 6X in terms of revenue compared to the previous quarter.
In India, SimSim faces direct competition with Hyderabad-based video commerce platform BulBul as well as Meesho, which does not admittedly have a video component, but it does have a simple functionality that may be easier for more people to use. Additionally, Walmart-owned ecommerce major Flipkart has also introduced a touch of video commerce on the mobile application through Flipkart Ideas. However, with the recently raised funds and its strong influencer network, SimSim is poised to make it a tough fight.
