She about-turned her startup from the brink of failure. Now it’s doing what Groupon couldn’t

It was the year Groupon tripped – 2011. The world was staring at a tectonic crack in the daily deals model. Businesses were no longer scrambling to give away coupons. And investors had stopped salivating over a plethora of companies riding on a fading craze.

This was a do or die situation for Anisha Singh, founder and CEO of daily deals company MyDala. Her two-year-old startup was on a collision course with failure. She had to think fast, act fast. “It was tough. It was crazy. My second child was just a few weeks old, and my older one, a toddler. But I wasn’t ready to give up on my company,” she recalls. “I was a guilty mom, and a guilty CEO.”

In that tight corner, she took a turn towards mobile – a decision that seemed outlandish when smartphone penetration was at an abysmal five percent in India. That swerve in 2011 saved her company. Today, MyDala has 50 million unique visitors doing 6.6 million transactions per month – 85 percent of which comes from mobile. Every day, 150,000 vouchers are downloaded from MyDala by mobile users. And this Delhi-based company is now gunning to be India’s Meituan, China’s top daily deals company with 200 million shoppers.

After Groupon’s meteoric rise and the subsequent death of the daily deals hype, most of its copycats faded away. But in China and neighboring India, daily deals are still in demand. A couple of months ago, Meituan bagged US$700 million in funding at a valuation of US$7 billion. This came less than a year after a US$300 million series C round from Sequoia Capital and Alibaba. Its rival 55tuan is set to go public in New York soon.

“On Meituan, a power user buys about 50 coupons every month. A power user on MyDala tends to buy about 15 coupons monthly. I am at the juncture where we just want to grow that number from 15 to 50 this year,” Singh tells Tech in Asia from her office in Delhi. Her confidence comes from a unique place – half of the transactions on MyDala come from India’s smaller cities.

“Everyone talks about going to the tier-2 and tier-3 cities. It’s the holy grail. But nobody else managed to crack it so far. But thanks to the network that we built over the years, 50 percent of our transactions come from tier-2 and tier-3 India. This keeps growing, and we have zero competition there,” she says.

A cappuccino in Siliguri, a blessing in disguise

Siliguri is a tiny city in Darjeeling on the banks of the Mahananda River. It is India’s gateway to Bhutan, Nepal, and Bangladesh, but it is far from the eyes of the ecommerce biggies. MyDala’s second big break came from this place at the base of the Himalayas.

To understand why this was such a big deal, we have to go back to where it all began for MyDala. Singh founded it in 2009, with two of her good friends Arjun Basu and Ashish Bhatnagar. This was just after she returned to India from the US and gave birth to her first child. A CEO with a hungry baby at home isn’t most people’s idea of a successful entrepreneur. But Singh already had startup experience behind her and had co-founders she “absolutely love to work with.”

In 2004, Singh had founded Kinis Software Solutions, which gave digital content marketing solutions for Fortune 500 companies in the real estate and e-learning industries. She ran it for five years before moving back home. Before that, she had done an MBA in Information Systems and worked with Centra Software in Boston.

The MyDala site launched in December 2009. Those were the heydays of Groupon and Singh’s focus was on users who love a good discount. “But the more I spoke to merchants, the more I realized that they needed a good place online to market their wares. Restaurants, tattoo studios, salons … all of them wanted it,” Singh recalls. She moved quickly to fill that gap and became an online marketing platform for both big brands and small businesses.