Technology for MSMEs: Resource-constrained small businesses have been relying either on peer networks, social media, friends etc., or business-to-business (B2B) platforms like IndiaMART, at best, for recommendations to various services around sales, marketing, branding, design, etc. With the limited size of sales and marketing teams within the company, small businesses have little option but to outsource these functions to various agencies or even freelancers for better customer acquisition and eventually revenue generation.
Nonetheless, this involves calling multiple potential vendors, trying to understand who is the right fit as per their budget, the expertise of the agency in a particular industry, its past performance, ensuring deliverables are completed on time with transparency in the overall process, and more. The solution to it could be a marketplace that undertakes the matchmaking between the small business or client and the agency, oversees the entire work process as decided by the two parties, and releases payment to the agency from the client-side after work completion.
To solve this problem, former marketing head at French tyre brand Michelin and Airtel’s Chief Operating Officer for Delhi NCR region Venkatesh Rangachari had launched the B2B services procurement marketplace GroCurv. The startup was founded three years back in January 2019 in Gurugram after Rangachari ran a sales and marketing consulting firm Hypersonic Advisors for two years along with his colleague at Airtel, Vipul Gupta.
“Small businesses don’t have access to expertise or money. While working at large businesses we realised if small players could have access to the right expertise, it could benefit them immensely. We were able to offer our own expertise to multiple small firms when we were running Hypersonic. But we could only offer consulting services there. So, we thought of creating a platform through which thousands of other small agencies or experts could work with small businesses,” Rangachari told Financial Express Online. Along with Gupta, Rangchari had exited Hypersonic Advisors in 2018.
So, who connects SMEs with the right vendors? GroCurv’s artificial intelligence (AI) based algorithm collects information from small businesses coming onto its platform based on questions related to their requirement such as social media marketing, public relations, sales training, website and app development, etc. The follow-up questions seek data related to the industry they operate in, budget, size of the businesses, and more. Based on the data, the algorithm identifies three agencies suited to the small business’s requirements.
The work request is then sent to the agency of choice that responds with the pricing, time required for completion of the task, and weekly deliverables. If the small business opts to go ahead with the agency, the latter shares updates with the client through weekly project monitoring calls about work completed. The payment is made to the agency from the client via escrow mechanism by GroCurv on completion of the entire project.
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“For example, in a public relations case, if there is a requirement of three press releases and a news article to be published on a news portal in a month, the agency would update the progress and if they deliver by the month-end, the payment is paid and the cycle continues for every month,” said Rangachari. If the task is not completed within the agreed time frame, the agency can extend the time period to complete the task and get its payment. If the project remains incomplete, the agency and client can decide on the partial payment to be disbursed. However, no project has been extended so far beyond the mutually agreed timeline. Also, the interactions facilitated by GroCurv between the small business and the agency and proposals exchanged are documented and recorded over conference calls throughout the process.
Currently, there are 28 service lines listed on GroCurv for small businesses to choose from under four broad categories – online marketing agencies, offline marketing agencies, sales agencies, branding and design agencies. The pricing for small businesses depends on the agency’s experience they have decided to work with. “Typically, some clients want to work with an agency that can deliver a service for as low as Rs 30,000 per month while there are clients that prefer more experienced agencies at Rs 70,000 – 1 lakh. Agencies have to showcase their work in terms of how they benefitted previous customers, the growth achieved, and accordingly, they price their services. The final decision on pricing is solely between the agency and the client,” added Rangachari. GroCurv takes a commission from the payment made to agencies on completion of the project.
The opportunity in enabling small businesses with a digital services marketplace is massive for players like GroCurv who have a first-mover advantage in the space. According to Rangachari, sales and marketing spending by businesses in India is currently around $50 billion, of which around 40 per cent or $20 billion belongs to the SME sector. This is the market GroCurv is trying to organise, he added. On the agency side, “there are more than 40,000 agencies across marketing service lines in the country. Helping them organise their business since most of them are also SMEs in size, giving them clients, getting payments from clients, and recording their work are benefits that help them grow,” said Rangachari who currently competes with another 2019-launched Gurugram-based startup in outsourced digital services space Benchkart.
“We can proudly say that we are the first marketplace in this segment helping SMEs pick the right agency,” he said. GroCurv has so far served more than 3,000 SMEs with an employee strength of just nine and is looking to at least double the count to over 6,000 this year. Rangachari didn’t disclose numbers around total agencies linked with the platform apart from revenue figures and expected growth this year. The company had raised an undisclosed seed round in May 2020 from Singapore-based Unicorn Investments.
Going ahead, the startup would also look at lending to SMEs and other add-on services. “We can think of lending to SMEs loans and offering recruitment services in future based on SMEs’ data around their size of business and growth. This is because the number of projects continuing on the platform and contracts renewing between clients and agencies is significant,” said Rangachari.