ElasticRun, a Corner-stores commerce platform announced that it has raised $75 million in a round led by existing investors Avataar Ventures and Prosus Ventures, along with participation from Kalaari Capital, at a valuation of $400 million.
Commenting on the investment, co-founder Saurabh Nigam said, “We want to expand our network to onboard at least a million retail outlets over the next 12-18 months and we need money for that expansion, besides spending on technology development.”
The company had earlier raised $2 million in seed funding from Kalaari Capital and Norwest Venture Partners in 2016. It picked up $5 million from the same investors as part of its Series A round in 2017. In 2018, the two funds pumped in $8 million as part of its Series B.
Avataar Ventures and Prosus (erstwhile Naspers) entered in 2019, while Norwest exited in a $40 million combined primary and secondary fundraise.
The Pune-based company has over 100 brands including top FMCG players like Patanjali, HUL, Nivea, P&G, Colgate, ITC, Britannia, Marico, and Dabur collaborating with it to reach 125,000 retail outlets in India.
Speaking about the development, Mohan Kumar, managing partner at Avataar Venture Partners said, “The company’s focus on using deep technology to address the need for commerce marketplaces has helped them scale rapidly, delivering much broader distribution for consumer product brands, while also creating a level playing field for the kirana (corner) stores – giving them parity with competing e-commerce players in terms of reach and product selection.”
Established in 2015 by Shitiz Bansal, Sandeep Deshmukh, and Saurabh Nigam, ElasticRun also works with banks and NBFCs such as RBL, Mintify, and CashKumar to assist them to fund unbanked retailers seeking a cheaper source of funding to manage their businesses. “We are in talks with other banks and NBFCs to partner with them as well,” Nigam added.
The company is planning to expand to 10 million kirana stores and is helping e-commerce firms like Amazon and Flipkart with logistical reach and last-mile delivery. Currently, its revenue run rate is about $350 million and is expected to cross $1 billion over the next 12 months, Nigam said.
India has more than 12 million kirana shops, with 10 being in rural areas where sales are expected to increase to $600 billion over the next five years, the company stated.
ElasticRun delivers a range of physical and digital services to kirana shops.
“Over the last 18 months, our consumer products and food business serving the rural kirana shops has seen dramatic growth. The Covid-19 pandemic has enhanced focus for many brands towards rural markets, and our model has enabled us to deliver real value to them and grow our brand basket significantly,” co-founder and CEO Deshmukh remarked. “We expect 2021 to be our biggest year yet and are looking to more than triple our business over the next 12 months.”
Ashutosh Sharma, Head of Investments for India at Prosus Ventures, said ElasticRun’s team has overcome the extreme hurdles caused by the pandemic.