Hardeep Singh
Introduction to the Platform
Udaan has added another feather to India’s crown when it comes to digital enterprises. It is one of India’s fastest-growing companies, aiding small enterprises by giving online commerce benefits. In smaller towns and villages, Udaan, an Indian company, gives a sufficient platform and chance for all merchants, wholesalers, distributors, and manufacturers to succeed as entrepreneurs.
Udaan India attempts to provide retailers and wholesalers with critical working capital loans at competitive rates while preventing exploitation of business owners. As a result, it has started underwriting consumer loans.Udaan, a unicorn firm, has been awarded a Non-Banking Financial Startup (NBFC) licence, allowing it to lend money to small and medium-sized businesses (SMBs) (SMEs).
Udaan is an online marketplace in India where small and medium-sized enterprises may trade with one another. Bengaluru was the starting point in 2016. With over 900 locations, three million shops, and 30,000 merchants, Udaan is a network-centric platform. LinkedIn claims to control 80% of the B2B e-commerce market in India. Udaan was founded by Amod Malviya, Vaibhav Gupta, and Sujeet Kumar and is now worth more than $3 billion.
The idea and the concept behind the Startup
Udaan India is headquartered in Bangalore and was launched in 2016. Amol Malviya, Vaibhav Gupta, and Sujeet Kumar, all former Flipkart workers, founded the company. Amod was the Chief Technology Officer, Vaibhav was a senior vice president, Sujeet was a supply chain logistics executive, and Vaibhav was a senior vice president.
The main goal of forming this organisation was to transport supplies to the country’s most distant locations, such as Bhabua, Bihar. While working there, they saw how, despite having such a sophisticated distribution network, Flipkart was unable to reach certain locations.
Reason for its success and immense recognition
One of the reasons for Udaan India’s success is that the company began conducting logistics at a discount within a year of its founding, allowing them to gain market share and awareness. Another critical component is the exceptional founding team.
Another critical component is the exceptional founding team. The founding members of the business already have the essential skills and knowledge from their time at Flipkart. As a result, a number of Flipkart personnel joined the company, supporting it in enhancing its efficiency and productivity. It gave the engineers a place to express their creativity, which is encouraged at Udaan.
The success of the firm might also be attributed to the service it provides to online merchants and distributors. Companies may compete more successfully with major merchants, branded stores, and websites by utilising internet services.
Approach and the way of the organization’s business model
Udaan India is a business-to-business model in which dealers and wholesalers are connected to manufacturers and may promote their goods and services online or through a mobile app. Food (staples, fruits, and vegetables), non-food (electronics and fashion), and pharmaceuticals are the three main verticals in which it works.This is due to the platform’s ability to connect small businesses and entrepreneurs with manufacturers directly and explore trade opportunities. The organisation works with companies to assist them with a variety of tasks, including sales, marketing, logistics, and operations. Small company owners may also use its services to help them better manage their payments and finances.
Challenges faced in the past
Many small company owners in India continue to operate in the conventional offline manner and may be hesitant to change. Recruiting such companies was an important part of the startup’s B2B model’s success, and it was a serious difficulty early on.
As an e-commerce business, Udaan too has seen its fair share of challenges. Establishing a solid supply chain network is one of the most difficult issues it faces. This is one of the most important elements to consider when a firm operates in the e-commerce sector. This is critical when an e-commerce site is competing with large corporations and other e-commerce behemoths. The logistics and distribution infrastructure of the firm must be in place. Another challenge is getting merchants and distributors to develop their online businesses. Initially, Udaan had to deal with this issue.
Fundings of the Company
Udaan’s parent firm, Trustroot Internet Private Limited, based in Singapore, raised roughly $30 million in March 2020. In early January 2021, Udaan received a $280 million investment from new partners Moonstone Capital Partners and Octahedron Capital.
According to Inshorts in the past, Udaan has risen significantly during the lockup period and currently has a market worth of $7.5 billion.
Lightspeed Venture Partners, Tencent Holdings, GGV Capital, and Hillhouse Capital have together invested over $900 million in the platform, according to TechCrunch. Lightspeed Venture Partners led the platform’s first investment round in November 2016, investing $10 million and valued the company at $40 million.
Following the success of the initial fundraising round, a number of businesses joined together to assist the company. When the second round of funding began in February 2018, the business was valued at $200 million, with a total investment of roughly $50 million. The third round of investment for the firm began in September 2018, when it was a dominant force in the industry’s transactions and markets. After this round, which raised $225 million, the company was valued at more than $1 billion.
The fourth financing round, commonly known as the series D investment round, began in October 2019 and resulted in a total of $585 million from a group of investors. The firm was valued at approximately $2.8 billion in this significant late-stage funding.
Current progression of the Company
Udaan’s revenue increased from Rs 46.3 crore in FY19 to Rs 978 crore in FY20 as of September 2021, according to Entrackr. Its spending in FY20 increased by more than fourfold, from Rs 850 crore in FY19 to Rs 3,488 crore. While Udaan is not in the same industry as these businesses, B2B organisations have their own set of requirements.
In only four years, the company has developed immensely, and it has great hopes for the future. Udaan is optimistic about the future, forecasting more adoption among merchants and other businesses, particularly during the COVID epidemic.
In 2018, Udaan, an Indian company, became the world’s quickest startup to achieve unicorn status. It only took 26 months to achieve this goal. This is a significant step forward.
Udaan began as a logistics company and remained thus for over a year. This boosted the startup’s capacity to create a substantial presence in the market. Since its inception in 2016, the company has spread to over 900 cities. Currently, the organisation offers loans, logistics, and payment services.
Conclusion
The Indian company has swiftly established itself in the industry, raising billions of dollars in just a few months. Despite stiff competition, Udaan has earned the title of India’s fastest unicorn by supporting small-business owners in swiftly embracing technology for the advancement of their companies.
Udaan is a role model for other e-commerce businesses. Udaan is one of the few firms that has risen to the top of its field in a very short period of time, adding to its illustrious history of achievement.
