Nearly seven months after a bid to be acquired by Infibeam fell through, Unicommerce, the e-commerce sector focused SaaS firm owned by Snapdeal, has moved on to pursue new growth avenues and stay in the game. For starters, it has sharpened its focus on large enterprise customers and is doubling down on overseas markets, notably the Middle East, even as it seeks to grow revenues seven-fold in the next three years.
“We have been profitable for over two years and we don’t need additional capital from our parent. We can continue to run independently and Snapdeal continues to operate as a financial investor,” Unicommerce CEO Kapil Makhija told TechCircle in an interview.
Makhija, who joined Unicommerce in early-2015 from global consulting firm AT Kearney, took charge as CEO in July 2017 after the company’s three founders, Ankit Pruthi, Karun Singla and Vibhu Garg, left to pursue other opportunities. Unicommerce, founded in 2012, was acquired by Jasper Infotech Pvt. Ltd, the Gurugram-based company that owns Snapdeal, in March 2015 in a cash-and-stock transaction. When Snapdeal ran into financial troubles of its own in 2017, it started looking for buyers for its stake in Unicommerce.
Makhija claims that even if the acquisition by Infibeam, the Ahmedabad-based e-commerce player, had gone through it wouldn’t have had any major impact on the company’s day-to-day operations. “It would have been a mere corporate event,” he said. It has been business as usual before and after the acquisition bid and there is no conversation on the horizon for a change in ownership, he added.
When Unicommerce was founded about eight years ago, it started with providing end-to-end order management and fulfillment to online sellers on e-commerce platforms. Along the way, it also raised some funding from venture capital firm Nexus Venture Partners and Snapdeal founders Kunal Bahl and Rohit Bansal.
Jasper Infotech acquired a 100% stake in the company at a valuation of Rs 288 crore and bought out the stakes held by Nexus Venture Partners and the Snapdeal co-founders who reportedly multiplied their original Rs 10 lakh investment each nearly 85 times. The company bought out stakes of the Unicommerce founders in 2018.
The move towards enterprise customers started sometime in 2016 as profitability became a focus area. “Our clients are predominantly offline brands who manage their online business through us. We are also piloting our omni-channel solution for inventory allocation which was launched in 2019,” said Makhija adding that TCNS Clothing, which owns brands such as Aurelia and W, and Being Human are two such companies that are trying out the product.
Unicommerce currently has a strong presence in the apparel and shoes category with plans on adding other verticals such as FMCG, home decor and babycare. Some of its notable clients include Forever New, Anita Dongre and Liberty. Among early clients, e-commerce platforms Jabong and Myntra continue to use Unicommerce.
The change in strategy to enterprise clients has helped the company turn losses from fiscal 2016 at Rs 14.6 crore to net profits at Rs 6.35 crore in fiscal 2018 according data sourced from VCCEdge. Such clients now constitute about half of its customer base and use its Warehouse Management System, which is also its largest revenue generating product.
The focus on profitability has also helped the company target overseas expansion. In March 2018, Unicommerce signed on Saudi Arabia’s online grocery delivery platform Wadi.com, which is backed by German investor Rocket Internet. Unicommerce also has a sales presence in Dubai and plans to expand further in the Middle East, which is likely to contribute 20-30% of the company’s revenues over time, said Makhija. After the Middle East, expansion into Southeast Asia is also on its radar.
“We are also considering partnering with ERP (enterprise resource planning) solution providers and PoS (point-of-sale) implementation companies which have a presence in those markets,” he added. It also has plans to double down on hiring and will add 60 people over the current year to its existing team of 120 people. “Expansion in Saudi Arabia will happen through regional hiring and we are looking to add people in international sales, domestic sales and technology,” he said.