Moving up the Ladder
If one has to search for an Indian furniture brand, it either ends at a couple names in home décor or high-end designer labels, which are custom made. The middle class, however, prefers to go to the unorganized market with hoards of local players. It is hard to recall a name, which can be labeled as a national player.
However, creating a brand in such a category and taking a smarter approach to sell them online, Urban Ladder has paved the road for many. Entrepreneur caught up with Rajiv Srivatsa, Co-founder and Chief operating officer, Urban Ladder, to know more on making furniture-shopping easier, while not compromising on great designs and after-sales experience.
How Urban Ladder happened?
We had started four years back. In terms of how we started, I think it was the need. We had to furnish our home and we were compelled to go through a tedious process. When we were in the process of starting this venture, very cheap varieties were available in the market. And, people were peddling through several overpriced and bad products. A platform like Urban Ladder was unheard of. The major idea of this brand was to cater to the needs of middle class. No one actually thought about the spectrum of the $25 billion industry at that time.
We had key priorities in mind while establishing this venture. Firstly, mobile and few other articles were already being purchased through e-retailers. So we thought, why not introduce furniture shopping in the online industry. We were totally focused on design. We made sure that the products were liked by nine out of 10 people. They were aesthetically designed and also had a contemporary look. Our products were moderately priced, neither too expensive, nor cheap also.
But, as manufacturers we made sure that we supply well-finished products. Good products come at a price. You cannot undersell. We even made sure that warranty and durability of products were offered to the customers.
Secondly, we set high standards in terms of end-to-end service. After sales, the products would be installed and we promptly replied to any queries from customers. Such services were not available earlier. Companies would deliver the product, and then the customer had to look for an errand man to install it. We ensured that the customers get a hassle-free service and we trained people to handle these issues in a very professional manner. In case, we took time to finish, we offered an alternative, we would temporalily supply them a product, when they had a function at home. When product was ready, we would offer it to the customer and take the temporary one back.
We ensured that the customers get a hassle-free service and we trained people to handle these issues in a very professional manner. In case, we took time to finish, we offered an alternative, we would temporalily supply them a product, when they had a function at home. When product was ready, we would offer it to the customer and take the temporary one back.
Where are you sourcing your products from at present?
We are sourcing from across the world, whether it is India, China, Southeast Asia or Europe. They are made on order, keeping in mind our certifications.
How did you and Ashish meet each other?
We knew each other from the days of IIM Bangalore. We were in the campus together from 2002-2004.
We participated in several extracurricular activities and also sat for campus placement together. That's how we met. The two of us moved to Bangalore in 2008, and often met for dinner. In 2011, we quit our jobs and started the company in July 2012.
How did you manage to fund the business initially?
We started raising funds from a very early stage, from the time we started up. Initially, we managed to raise about one million dollars, which was sufficient to manage our operations. Later on, we planned different rounds of funding.
How did you meet Vani Kola?
We met Vani multiple times, before she desired to invest in our venture. We got a lot of feedback from her, as a home connoisseur. She took a lot of interest and gave lot of inputs on where to source from. Vani is really well-attached to the space, hence, very well connected. Meanwhile, she also liked our approach, considering we did not have any entrepreneurship background but we had work experience. She further introduced us to Ratan Tata.
Any particular piece of advice given by Ratan Tata?
There were a few of them. Firtsly, he asked us not to lose touch on design; to go really deep into understanding the business, like consumer behaviors and other aspects. This became a bigger focus for us. In terms of local supply chain also, he advised a lot.
Is the company looking for any fresh round of funding in the coming time?
At least, not in 12-18 months, we have raised sufficient funds. So, we will certainly not be raising funds
Is there any other channel which you are looking at in online segment?
There is nothing specific apart from it, but, we are focusing on tele-commerce. Mobile industry is over 40 per cent of our business. We also believe that virtual reality will start playing a big role in the market as in the next two-three years, multiple devices will be coming in. It would be a big channel through which people will start buying.
Has the company been able to reach at the break even?
We are already in the profitable transaction level. The marketing costs are very low and if you add salary costs, we burst some money.
The idea is to break one more round and shoot the profitability. We are looking at $50-60 million.Operational profitability will be reached by the end of next year.
(This article first appeared in the Indian edition of Entrepreneur magazine (November 2016 Issue).