Flipkart, an Amazon-like e-commerce site in India, has raised $20 million from Tiger Global. This brings the company’s total funding to $31 million. Previous investors include Accel India.
Flipkart launched in 2007 as an online bookstore, but recently expanded to Electronics, Mobile Phones and CDs/DVDs of music, movies, games and software. The site is still the largest online book retailer in the country (the site has 10 million titles available), but aims to become an e-commerce destination for electronics, music and more.
Currently, Flipkart has sold 2 million items across all categories and is seing around 4 million unique vistors per month. Repeat purchase rates are around 70 percent. Sales of CDs and books are about half of the company’s revenue, says CEO and co-founder Sachin Bansal. Sales are growing by 25 percent every month, and Flipkart is on track for a $50 million run rate.
Bansal tells us that Amazon has not yet entered the country, but is rumored to be looking at ways to tackle the Indian market. He says for now, Flipkart’s biggest competitor is offline shopping in brick and mortar stores. The challenge in India, Bansal explains, is helping consumers understand the deals they can find online.
Of course, as internet connectivity grows in the country, so will e-commerce engagement and transactions. Bansal says that currently there are 80 to 100 million internet users in India and that is estimated to grow 30 percent year over year. His goal is to create a value proposition that makes consumers realize that online shopping is beneficial. So what are these offers? Bansal says that he aims to create an Amazon Prime like shipping and delivery experience.
Another feature Flipkart offers is a Cash-on-Delivery option, which allows buyers to pay cash to the courier that delivers the item.
Of course, when Amazon eventually does enter India, Bansal doesn’t seem to worried about the e-commerce giant. “Our supply chains and warehouses have built over te past three years, and we have facilities in Bangalore, Mumbai, Delhi and Calcutta,” he explains. “It’s not easy to build the infrastructure in India that we’ve established over the past few years.”
Flipkart will use the new funding to improve the site’s backend, increase warehouse facilities, expand the supply chain logistics, and sales and marketing initiatives.