Power2sme raises second round of funding from Accel Partners
Gurgaon-based BEBB India Private Ltd that runs Power2sme, an online platform that acts a buying club for small and medium enterprises (SMEs), has raised an undisclosed amount in a another round of funding from early-stage VC fund Accel Partners.
BEBB India Private Ltd, which owns Power2sme, was founded by R Narayan in January 2012 with a seed capital of Rs 2 crore and it started operations in July the same year. It had earlier raised a Series A round worth Rs 10 crore from Inventus Capital Partners and Kalaari Capital (formerly Indo-US Venture Partners).
Power2sme acts like a buying club for SMEs and offers information and tools that enable SME's to reduce their procurement costs. The business model helps SMEs by eliminating the need to engage with multiple vendors, providing doorstep delivery of the goods through logistics providers, offering flexible payment options and accepting orders online 24Ã—7. It is currently catering to industries such as construction, manufacturing, precision engineering and automotive OEMs.
For revenue generation, the company buys the products at a certain price from the suppliers, and sells it to the SMEs by charging a bit more. For example, the company purchases a Rs 100 product for Rs 80 and sells it for Rs 83. This way, the SMEs are still getting a good deal on the products and the company also gains.
In a conversation with Techcircle earlier this year, Narayan had said that the company was looking to cross $1 billion in GMV in the next five years and aim to achieve profitability by 2014.
(Edited by Prem Udayabhanu)