Indian jewellery estore bags $15.7M. Here’s what you should know about the industry

Indian jewellery estore BlueStone today announced it raised US$15.7 million from Accel Partners, Ivy Capital, Dragoneer, Kalaari Capital, and Saama Capital. The startup had raised a previous round of US$10 million last year, led by Kalaari Capital.

BlueStone offers a range of precious jewellery, including earrings, rings, pendants, bangles, and bracelets. The category is estimated to be worth US$50-60 billion a year in India.

The startup claims to design and manufacture all products in-house. It also allows you to customize wedding jewellery. A stylist from BlueStone exclusively designs the complete collection of jewellery matching the wedding trousseau. The website also has a live chat feature, so that visitors can directly get in touch with experts for their design needs and other queries.

Bluestone lures new buyers with try-then-buy options and easy money back and exchange policy. This is because precious jewellery in India is an extremely complex category. It is seen more from an investment angle than as accessory. Most Indians buy jewellery only from their family jewellers who have been running their shops for several decades because trust in the purity of gold and genuinity of diamonds and gemstones is a major issue.

Beating odds

However, this is slowly changing as the government has made hallmarking of gold jewellery compulsory and there are agencies like the Indian Diamond Institute (IDI) providing diamond certification.

Consumer behaviour is equally fast changing, as young couples have moved out of their hometowns to look for jobs. These first-time buyers are willing to experiment by shopping for jewellery online. Online buyers in general are known to be deal seekers, but it isn’t necessarily true for jewellery buyers. Traditionally, in India, shopkeepers would place a few pieces of jewellery in a tray and consumers try them on and buy. What online shopping offers is the convenience of being able to browse through a much larger variety.

Last year, BlueStone sold a solitaire ring worth US$14,200 and two necklaces worth over US$7900 each on its site.

BlueStone claims to have a revenue run rate of US$15 million per annum. “Consumers are far more comfortable buying jewellery online today, than a year back. I am confident about achieving over three times growth every year for the next three years,” said Gaurav Singh Kushwaha, co-founder and CEO of BlueStone. The company claims to be operationally profitable.

BlueStone is now aiming to expand its team to cater to growing demand, add more products, and improve user experience on mobile and desktop.

The company competes with Caratlane which received US$31 million in a series D round from Tiger Global. It will also be up against the many mom-and-pop stores which are gearing up to marketplaces like Amazon, which recently appointed publicly listed jeweller Tara Jewels’ CEO Vikram Raizada as the head of its jewellery division. Traditional players have an upper hand due to their inherent trust factor.