Why my startup isn’t scaling

Photo credit: Unsplash.

This is my 20th year in retail. Way back in 1997, when I was studying in NIIT—India’s foremost tech institution then—learning how to code using C, C++, Visual Basic, and so on, I dreamed of a day when I could order things from a neighborhood outlet and get it delivered to my doorstep. That was around the time a startup in America called Amazon was trying something similar. Customers didn’t need to go to a retail store because the products came to their doorsteps.

A decade back, we saw small startups such as Flipkart and Indiaplaza doing something similar in India. They started with books and music, and now, people can purchase practically everything online—from groceries, pet food, condoms, to clothing—and get them delivered to their homes.

Two years ago, I found a gap in this space. Even though the industry saw great ecommerce apps, with engaging user interfaces, a fantastic range of products, competitive pricing, special offers, and high engagement, the products didn’t have a “seller face.” Most of these apps and websites were merely marketplaces and not really the actual sellers.

Customers had to wait a day or a week until the product reached them. There had also been several cases where bricks were sent instead of a mobile phone, a fake for the original, and so on. Moreover, delivery schedules were crazy. Customers had to make sure someone was available to receive the item and pay for it in cash (cash on delivery represents around 60 percent of all available payment options in India).

That’s when I decided to do something differently. Thus, my startup Oyethere.com was born. We deliver products to customers within 30 minutes, at minimum, after receiving the order. Our customers love us and have given us a lot of business.

We pick up items for our customers from the nearest retail stores of their choice. This spares us the need for storage and warehousing, complex supply chain management, and, of course, investment in technology for merchandising, sourcing, and operations.

We started delivering a few hundred items, then scaled up to thousands. We also sold T-shirts featuring Indian superstar Rajnikanth during the release of his film “Kabali.” We delivered eco-friendly clay Ganesha idols during the much revered Ganesha Chathurthi festival.

But we’ve since scaled down. I haven’t been able to scale my business in volumes and values. Unicorns in India are flourishing and minnows like us are unable to scale up. The fundamental reason for that is I haven’t been “investing” in acquiring new customers and in retaining existing ones. Acquiring and retaining customers is not just a metric in the Indian ecommerce ecosystem but a norm.

Honestly, I don’t believe a business should pay to acquire or retain customers. If a user doesn’t see value in what you provide the first few times they work with you, then they don’t really care about your core proposition.

So the business has remained stagnant, although we continue to serve a small group of happy customers. And trust me, this is my real pitch to potential investors: that we are not going to waste money to keep customers happy with coupon codes and vouchers. We would rather live up to our promise of quick delivery and broaden the range of our products (which is what we are up to these days), and we are sure to get traction. A post on that soon.

This is an opinion piece.