Why This Startup is On a Roll 10club has acquired 7 brands to date and its entire portfolio today has margins of about 25 per cent to 27 per cent
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Before starting 10club, co-founders Joel Ayala, Deepak Nair and Bhavna Suresh did extensive research on the potential of e-commerce in India. They were convinced that the model of an e-commerce roll-up would really take off in the Indian market, given the large-scale digital transformation that India was witnessing over the last few years.
"Nearly half the population had internet access in 2021, while more and more consumers are turning online for every purchase possible. Based on that knowledge, we launched 10club, raised a seed funding of $40 million, and are now building a portfolio of successful digitally native brands – brands that were born and grown on e-commerce platforms such as Flipkart and Amazon," says Bhavna Suresh, co-founder and CEO, 10club.
The market has evolved a lot since 10club was launched and the addressable market today is large. At the time the startup was launched, there were over 70,000 sellers on Amazon and others on Flipkart, Myntra, and social media platforms. "This number has now crossed the 1 million sellers mark for Amazon, and Flipkart is estimated to have 4 lakh sellers registered on its platform. While we have kept ourselves strategically limited to some categories, the rapid surge of the Indian e-commerce industry will continue to ensure that there is ample scope in the years to come," she says.
While in the future, the startup may entertain the idea of building D2C approaches for its brands, currently, it is focusing on strengthening its portfolio on marketplaces. The company is focusing on improving the visibility of the products on the platforms they currently reside on as well as expanding to other e-commerce platforms as well.
"The play on e-commerce platforms is quite different from a D2C play, there are a lot more product and category-focused variables that we need to consider for our products to do well on marketplaces, not to mention the stiff competition from the numerous sellers in each category on these platforms. From pricing and delivery timelines to images and content, everything plays a vital role in the success of a product on marketplaces. It is not difficult to build a digitally native brand on e-commerce, but it is certainly not without its own challenges," she says.
10club has acquired 7 brands to date and its entire portfolio today has margins of about 25 per cent to 27 per cent, and a very high cash flow. At present, its portfolio includes Skudgear, Rapidotzz, Beclina and Aurion in the sports category; Kraftseeds, Gate Garden and Kriti Kalash in the home segment; and MyNewBorn in the baby care category.
Going ahead, the company plans to acquire 20 brands across home, sports, baby, and pets categories and aims to do at least $120 million worth of business through the portfolio brands in the next year.