The pre-series A round also saw participation from existing investors Snow Leopard Ventures, Lightspeed Partners, and Matrix Partners India, as well as new firms - Venture Catalyst, HOF Capital, Old Well Ventures, LetsVenture and 9Unicorns.
Dukaan, a retail platform that helps entrepreneurs to set up online store, on Monday said it has raised USD 11 million (about Rs 80.3 crore) in funding led by 640 Oxford Ventures. The pre-series A round also saw participation from existing investors Snow Leopard Ventures, Lightspeed Partners, and Matrix Partners India, as well as new firms – Venture Catalyst, HOF Capital, Old Well Ventures, LetsVenture and 9Unicorns. Many high-profile executives also participated in the funding round, including OYO Room’s Ritesh Agarwal and Nothing co-founder Carl Pei. Suumit Shah, CEO and co-founder of Dukaan, said the post-money valuation of the company after this round would be USD 71 million.
The company has over 3.5 million sellers, who have opened their stores using the Dukaan platform and 70 per cent of these stores are from beyond the top six cities. Dukaan has also facilitated over 1.5 million transactions for these sellers, he told PTI. ”We founded Dukaan because we saw small businesses and first-time entrepreneurs struggling to digitise and make their presence online. We became obsessed with the idea of making the most affordable, easy-to-use, mobile-first commerce platform in the world,” he added.
Dukaan had raised USD 6 million in a seed round from Matrix Partners and Lightspeed Partners in October last year. Shah said the latest capital infusion will allow Dukaan to aggressively expand its operations while building its team of highly skilled designers and developers.
“Additionally, this capital accelerates our ability to establish key strategic partnerships to grow our paying merchant base. We started with our monetisation journey on a small merchant base last quarter, and more than 2,000 merchants have enrolled in our Dukaan premium subscription plan so far,” he said.
Premium subscription contributes about 10 per cent to the company’s revenues, he added.”We started with the monetisation of a small set of users in the last quarter and so many monetisation experiments are currently going on. Presently, we are at around USD 7,00,000 ARR (annual recurring revenue) in terms of revenue. We are just a year-old company and currently, the whole focus is to help as many merchants as possible,” he said.
The company has multiple sources of revenue, including take rate on transactions (0.40-3 per cent cut on each transaction happening through Dukaan Pay), the mark-up on marketing costs etc. It also offers Dukaan Delivery that provides an automated shipping solution and Dukaan Infinity that includes consultation on marketing, design and other business decisions for brands.
Shah said the company’s premium subscription revenues are currently growing at 23 per cent month-on-month and it does not expect sluggishness in this growth at least for a few quarters.
“Overall TAM is very large and we are just scratching the surface as of now. We have plans to add more value to the subscription pack without making it unaffordable for our partners,” he added. Shah stated that Dukaan currently has 98 employees, and the company plans to hire 100 engineers to strengthen its product and offerings. “We will be investing in talent on both the business and product sides as well,” he added.