Meesho - The Success Story of India's No.1 Reselling App

Sarika Anand Sarika Anand Chayanika Goswami Chayanika Goswami
Jul 25, 2022 19 min read
Meesho - The Success Story of India's No.1 Reselling App

Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by Meesho.

Today, one can easily launch their very own online business seated comfortably at their homes, without investing a lot of money. Online shopping has developed significantly over the previous decade, and eCommerce companies now generate billions of dollars in monthly sales all across the globe.

People are depending on online purchasing platforms more than ever since the outbreak of the pandemic, and many are also using this opportunity to develop their own online empires. The online reselling industry is no different in that aspect.

It is very economical to establish an online reselling service. The expense of producing a product, handling inventory and paying for all the tools, personnel, and instruments can easily be dodged this way since you merely act as a link between the supplier and the buyer.

If you too are considering starting your reselling business Meesho is a platform you can consider. Meesho is an online resale platform that allows anybody to establish a company without having to put up any money. Leading the reselling landscape of India, Meesho takes pride in reselling indeed! Β 

Here is the story behind the popular Indian reselling platform Meesho, the Latest News about the company, and about Meesho's Founders, Startup Story, Mission and Vision, Business and Revenue Model, Funding, Investors, Competitors, and more.

Meesho - Company Highlights

Startup Name Meesho
Headquarters Bangalore, Karnataka, India
Industry Retail, E-commerce
Founders Sanjeev Barnwal, and Vidit Aatrey
Founded 2015
Valuation $5 bn (March 2022)
Total Funding Raised $1.1 bn (October 2021)
Revenue $841.5 mn (FY21)
Current CEO Vidit Aatrey and Sanjeev Barnwal
Meesho Website www.meesho.com

About Meesho
Meesho - Industry
Meesho - Name, Logo, and Tagline
Meesho - Founders and Team
Meesho - Startup Story
Meesho - Mission and Vision
Meesho - Business Model and Revenue Model
Meesho - Funding, and Investors
Meesho - Investments
Meesho - Growth and Revenues
Meesho - Advertisements and Campaigns
Meesho - Competitors
Meesho - Challenges Faced
Meesho - Future Plans

About Meesho

The online reseller platform Meesho perhaps requires no introduction. The platform has carved a niche for itself and has gained popularity among consumers and retailers alike by making online reselling and shopping hassle-free and affordable. Meesho provides secure and timely transactions, as well as low-cost returns and shipping. More than 2.6 million resellers throughout India trust Meesho.

The Bangalore-based startup aspires to build an environment where anybody can establish a business with no financial investment. Along with having over 2 million resellers, the company also boasts of having more than 20,000 Meesho suppliers from more than 500 towns to its name. Meesho works on a commission of about 10-15%, and sellers may earn money with Meesho by introducing a gross margin to every transaction.

Meesho, India's largest resale platform, was founded in 2015. Meesho app essentially connects manufacturers to resellers. Manufacturers list their commodities on the Meesho shopping app, which allows merchants to choose from any of their products and sell them to customers using social networks like WhatsApp, Facebook, and Instagram. Clothing, accessories, furniture, culinary utensils, and cosmetics producers are among the suppliers who list their products on Meesho.

Independent resellers can then choose any product from these suppliers and sell it to customers using the social media sites mentioned. It's as simple as posting a photo of the item on Instagram or writing a Facebook post to sell it. After the customer and the reseller have agreed on the purchase, the Meesho items are delivered to the buyer's home. Buyers have the option of paying with a debit/credit card or cash on delivery for a secure and quick procedure of transaction.


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Meesho - Name, Logo, and Tagline

Here is the Meesho logo:

Meesho Logo
Meesho Logo

Meesho means "Meri Shop" or "Apni Dukaan" in Hindi, which justifies the service it provides. Meesho aspires to build an environment where anybody can establish a business with no financial investment.

Meesho's tagline says, "Not just a homemaker, a Meesho Entrepreneur."

Meesho - Founders and Team

Founders of Meesho - Sanjeev Barnwal and Vidit Aatrey
Founders of Meesho - Sanjeev Barnwal and Vidit Aatrey

Meesho was founded by Sanjeev Barnwal and Vidit Aatrey in 2015.

Sanjeev Barnwal

Sanjeev Barnwal is the Co-founder and Chief Technological Officer (CTO) of Meesho. Sanjeev Barnwal has also worked at Sony Mobile Communications as an Android Camera Hardware Abstraction Layer Architecture Designer and Developer. He graduated from IIT Delhi with a bachelor's degree in engineering and has also worked with Sony Corporation prior to that.

Vidit Aatrey

Vidit Aatrey is the Co-founder and CEO of Meesho. Prior to Meesho, the Meesho Co-founder worked with the mobile marketing platform InMobi, where he designed growth strategies for the company. Aatrey has also seen the Operations part of the business when he was with ITC Limited. Β 

Meesho works with an employee strength of 750+ employees in its team.

Meesho - Startup Story

In 2015, when Meesho was started, it was known as FASHNEAR. The idea behind FASHNEAR was just like Swiggy or Zomato. FASHNEAR dealt with Fashion related goods and allowed customers to buy clothes and fashion accessories from the shops in their locality. Local shops selling apparel and accessories could register with the FASHNEAR app, and customers can order from these local shops, and delivery persons were there to deliver the goods.

β€œSanjeev and I fulfilled every role during this period. We did the inventory of every shop, spending entire days taking photos of all the products and cataloging them on our app. I also worked as the delivery person in the beginning, because I wanted to hear my customer’s feedback first hand." Vidit said speaking about FASHNEAR's initial days.

However, soon the founders started to notice some flaws in the FASHNEAR business model. Some major drawbacks they noticed were that consumers were not much concerned about buying clothes from local shops. Besides, the shop owners also wanted to increase sales by selling their products online in different locations of the country, rather than selling their products locally. These problems inspired Vidit and Sanjeev to work on a better business model. By the end of 2015, Fashnear was renamed as 'Meesho'.

The founder duo visited many shopkeepers and resellers to identify their problems. They noticed that many shopkeepers were already selling goods through WhatsApp, but their reach was limited because they deliver their goods locally only. They also found out that most of the shops registered on MEESHO were operated by women, and these women sold their goods out of their homes rather than in any physical shops. Meesho's current business model has been built considering these facts and issues, and currently, with Meesho, women can comfortably start a reselling business from home, without owing any inventory. Meesho also now empowers small shops and manufacturers to deliver their goods across the country, while Meesho takes care of the delivery of the products, facilitates COD options, and ensures that consumers can seamlessly return the products if they wish. Thus Meesho serves as a bridge between suppliers (manufacturers and shopkeepers who list their products on Meesho), resellers, and customers. Meesho also helps suppliers manage their inventories.

Meesho - Mission and Vision

The company's aim is to help 100 million small companies prosper in the digital world. Meesho's mission statement says, "Democratize internet commerce for everyone."


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Meesho - Business Model and Revenue Model

Regarding the business model, we cannot say that Meesho operates on a D2C (Direct to Consumer) business model. In the D2C business model, a product is sold directly to the consumers by the manufacturer. However, Meesho involves resellers, who are the middleman between manufacturers and consumers. Meesho is a platform that helps businesses (which includes manufacturers and reselling business owners) to increase their sales, and in turn, charges certain fees and commissions from the businesses. Thus Meesho has a B2B business model now, which the company switched to in 2021 after it changed tracks from the reseller model that is focused on from the very beginning. Following are Meesho's major sources of revenue-

Commission

The commissions Meesho charges from the vendors have been a major source of their revenue. When a reseller sells a product on the Meesho platform, the seller of that product will be charged a certain percentage of commission. The commission-based business is similar to those of E-Commerce platforms like Amazon, Flipkart, and others. As per the company's website, 0% commission is charged from the suppliers on certain categories of products. No commission is charged from the resellers.

Other than commission the other sources of revenue are -

Logistics

Meesho offers logistics services to the suppliers and charges a fee for the same. The Meesho team is now working on reducing the logistics charges to increase the profitability of the sellers. Β 

Advertisements

A portion of Meesho's revenue comes from Advertisements. As the number of sellers on the platform is increasing, sellers who want to highlight their products in front of the resellers and customers on the platform pay a certain amount for advertising their products.

Data

As we all know, data is the new oil, and data certainly offer an income stream for Meesho. Meesho did not break any privacy policies, and they are only allowed to sell data that does not infringe any privacy issues.


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Meesho - Funding, and Investors

Over the course of 11 rounds of financing, Meesho has raised a total of $1.1 billion. The most recent capital for Meesho came through a Debt Financing round on October 20, 2021.

Date Round Amount Lead Investors
Oct 20, 2021 Debt Financing - Trifecta Capital Advisors
Sep 30, 2021 Series F $570M B Capital Group, Fidelity Management and Research Company
Apr 5, 2021 Series E $300M SoftBank Vision Fund
Aug 12, 2019 Series D $125M Prosus & Naspers
Jun 14, 2019 Corporate Round $25M Meta
Nov 5, 2018 Series C $50M DST Partners, RPS Ventures, Shunwei Capital
Jun 7, 2018 Series B $11.5M Sequoia Capital India
Oct 12, 2017 Series A $3.4M Elevation Capital
Aug 18, 2016 Seed Round $120K Y Combinator
Mar 1, 2016 Angel Round $180K Investopad, Rajul Garg, Venture Highway

Meesho is looking forward to an IPO in early 2023, as per sources close to the company and the matter. It is planning to ready its listing by the end of 2022 and is assessing both the Indian and the US markets for its public listing. Β 

Meesho - Investments

Meesho has invested $8M in Latin America's top social commerce platform Elenas.

Date Organization Name Round Amount
Mar 4, 2021 Elenas Series A $6M
Oct 15, 2020 Elenas Seed Round $2M

Meesho - Growth and Revenues

During its flagship seasonal sale event, Maha Indian Shopping League, held from 6th - 9th October 2021, Β Meesho saw a 750% increase in users over the previous year i.e 2020. Tier-4+ markets accounted for about 60% of total demand, including far-flung locales like Khawzawl in Mizoram and Sopore in Jammu and Kashmir.

According to the company, merchants on Meesho saved over Rs 13.6 crore during the Christmas sale event alone because of its industry-first 0% commission scheme, which was launched earlier this year. During the Maha Indian Shopping League, the firm had a 314% increase in merchant participation, resulting in a 10X increase in revenues over the previous year. Meesho onboarded over 100,000 vendors ahead of the sale event with a number of new initiatives, including free ad credits and no return shipping charges for the first 30 purchases.

During the sale time on Meesho, customers saved around Rs 60 crore in discounts. In its fashion segment, the firm had a lot of success. In comparison to the previous year, orders for women's clothes and accessories increased by 623%, while orders for men's apparel increased by 640%.

Meesho became the latest startup to join the illustrious unicorn club in April 2021, after receiving $300 million in a new investment round spearheaded by SoftBank Vision Fund 2, valuing the company at $2.1 billion. The company was last valued at $5 bn in March 2022. Some of the latest growth highlights of Meesho are:

  • It currently has 100 mn transacting users. The startup grew its user base by 5X in FY22.
  • The GMV grew by 3X during FY22
  • Meesho sells more than 40 mn products on its platform
  • It delivers now to 26000+ pin codes and across 4800+ cities in India

Farmiso or Meesho Superstore

Meesho relaunched Farmiso as Meesho Superstore, in its rebranding attempt on April 5, 2022. This was done with an aim to focus on the customer demands of everyday needs in Tier 2 markets and beyond that. Furthermore, the prominent reselling app in India has also announced its plans of integrating its grocery business into the main Meesho platform, which is expected to be done within the 1st week of May 2022. The company boasts of the fact that it has successfully managed to expand its grocery service to 6 states within 9 months. The company has further plans to expand its Superstore to 12 states by the end of 2022.

Meesho Superstore Logo

This rebranding and integration of the Meesho grocery app Farmiso to the main Meesho app is quite significant and is in line with the quest for super apps, which are to dominate the Indian and the global digital ecosystem soon. Furthermore, with only 0.5% of the grocery sales happening digitally, it is really important to note that Meesho has a massive market that it can tap into. Β 

Meesho Financials - Revenue, Expenses, Profit/Loss

In the Financial year 2020, Meesho made revenue worth INR 341.6 cr, the operating revenues of which were recorded at Rs 307 cr. The company's expenses totalled INR 657 cr during the same fiscal, thus the company incurred losses worth INR 306.70 cr in FY20. Meesho, which has registered a 3.8X growth in FY20, has again witnessed a 2.6X growth of operating revenues in FY21, making it two consecutive years of growth for the social commerce business. Along with boosting its operating revenue to Rs 793 crore, Meesho has also earned non-operating revenues worth Rs 48.5 crore.

Meesho Financials FY21 FY20
Operating revenue Rs 793 cr Rs 307 cr
Total expenses Rs 1,337.30 cr Rs 655.40 cr
Profit/Loss Loss of Rs 498.65 cr Loss of Rs 306.70 cr
EBITDA margin -58.40% -85.51%

On the expenses front, Meesho spent Rs 1,337.3 crore in FY21, which witnessed a surge of around 104% from Rs 655.4 crore, which is raised in FY20. Meesho had to spend Rs 1.69 to earn a single rupee of revenue during FY21, which is a 20.6% growth from what it spent to earn the same in FY20. The social commerce unicorn had to spend Rs 2.13 during FY20.

Meesho Revenue Breakdown

Meesho has recorded a total of Rs 838.6 crore worth of revenues in FY21, thereby growing by 140% from Rs 348.7 cr, which is recorded in FY20.

Meesho revenue verticals FY21 FY20
Revenue from sales Rs 792.8 cr Rs 306.9 cr
Other income Rs 45.8 cr Rs 41.7 cr

Meesho Expenses Breakdown

Here's a breakdown of Meesho's expenses:

Meesho expenses verticals FY21 FY20
Advertising and sales promotion Rs 424.20 cr Rs 217.40 cr
Logistics and manpower expenses Rs 645 cr Rs 260.80 cr
Others Rs 29.70 cr Rs 32.40 cr
Employee benefit expenses Rs 149.30 cr Rs 170 cr
IT and communication expenses Rs 89.04 cr Rs 37.80 cr

Meesho - Advertisements and Campaigns

Meesho debuted its first television advertisement on September 25, 2020. The commercial shows that a lady is called by many names, a wife, a mother, a daughter, sister, or daughter-in-law, but despite all household responsibilities, a lady can build her own identity and income source with Meesho! Β 

Meesho announced the launch of its "Sahi Sahi Lagaya Hai" campaign in September 2021 to appeal to the tier 2 markets and beyond. Through this campaign, Meesho highlights how its consumers are benefited from a wide range of products across diverse categories at affordable prices from sellers all across the country with the help of the Meesho app.

Another recent campaign launched by Meesho in February 2022, addresses the customers' dilemma β€˜Loon ya na loon?’ Meesho follows its Sahi Sahi Lagaya campaign with this one to help the consumers get over their dilemma of purchasing, thereby maximizing their spending.


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Meesho - Competitors

Some of Meesho's major rivals are:

  • Volusion
  • Elenas
  • DealShare
  • GlowRoad
  • Shop101
  • CityMall
  • Bulbul.tv
  • SimSim
  • Magento
  • ALIPPO
  • Huboo
  • Drop

Meesho - Challenges Faced

Initial Startup Challenges

When Meesho was starting off, online retailing was becoming increasingly popular, but there were obstacles such as a shortage of supply, transportation, transaction alternatives, and so on.

According to the CEO, they have always aided small firms in their growth, and as a result, they have never maintained any goods in their own warehouses. However, due to the COVID-19-induced lockdown, getting items supplied proved problematic. Even after the government granted a modest easing on car mobility, things remained challenging.

The Pandemic-induced Challenges

Meesho provided the majority of the income for many of the suppliers that sold their products with them. The majority of their revenue was impacted by Covid. As a result, during the first several weeks, their exclusive emphasis was on establishing a basic logistical network. This was a difficult task because each state has its own set of laws for vehicle admission and exit.

Most of the revenue for the female entrepreneurs (re-sellers) of the company came from the fashion sector, but these items couldn't be shipped for a time since fashion wasn't included under the necessities. As a result, their first objective was to assist these resellers in recouping part of their lost revenue. That's when they began pushing vital supplies to their resellers, which was a category they had never sold previously. Masks, personal care, sanitisers, and even groceries were among the items sold. They also devised a scheme to sell masks created at home by their own resellers.

Many of their sellers opted for sewing masks at home, and they purchased their inventory from them and sold it on their own, on the market. The organization had thousands of entrepreneurs engage in the initiative, and their logistics crew even went home and picked up handmade masks.

Not everyone, however, was able to take part in this improvisation approach. As a result, they devised a micro-credit approach to ensure that their resellers were able to earn some money. They gave their resellers modest loans of Rs 5,000 as part of this program. They were able to give these loans without any formal screening or paperwork since they possessed all of their resellers' bank accounts and earnings information. Even in these uncertain times, they can conclude that "these moves strengthened our relationship and trust with our user base."

Change in Strategy, Huge Cash Burn and No Profit

Meesho had truly come up as a poster boy in the social commerce segment some time ago with its $4.9 bn valuations that it posted, but now the company seems to be witnessing tough times and is tongue-tied in front of the investors with a change in strategy, high cash burn, no profit in sight and increasing competition from big players like Flipkart and Amazon. The company recently changed its business model and made it similar to that of the eCommerce platforms.

Meesho has suddenly changed its strategy from social commerce to B2C, dumped international expansion to foster small-town groceries, and has also jumped from a zero-commission model to ad-monetisation. An anonymous investor had recently stated that the company had already spent more than $500 mn in the past couple of years, but is currently back to the starting line. Β Competition has trebled for Meesho, which once had smaller players like Shop101 and Glowroad to compete with. Now, Meesho is facing stiff competition from bigger e-commerce players like Flipkart and Amazon. With its Shopsy app, Flipkart has already entered the social commerce domain in July 2021 and has challenged Meesho by taking away a chunk of its resellers. Besides, Β Shopee, Southeast Asia's popular eCommerce platform has been launched in India in 2021, which is also giving a tough time to Meesho. Shopee has already built a $150 bn business in 13+ countries across Asia, South America, and Europe.

Meesho Layoffs

Meesho has recently fired around 150 employees, as of April 11, 2022, due to a restructuring initiative of the Meesho Superstore grocery delivery service. The eCommerce unicorn is looking forward to restructuring its grocery business and bringing in efficiencies. This has led to the laying off of a small number of the full-time Meesho employees and the reassessing of some third-party contractual roles in order to remove redundancies with the core Meesho business and its operations.

Major Counterfeit Problems

Meesho has been bugged with some major counterfeit problems lately. It is for the past few months that the social e-commerce model-led startup has been troubled by issues that are associated with counterfeit products that are supplied to its customers. Meesho makes it easy for any merchant to set up their storefront on the platform but that is leading to the sale of counterfeit products. Besides, among the counterfeit listings, one of them also has a 'Meesho Trusted’ label, which is worse. Advocate Ajay Kumar Singh recently brought in a 40-page compliant for the Central Consumer Protection Authority to look into, who had purchased several products of reputed brands like Ray-Ban, Adidas, Nike, Titan, and Gucci, which has also been selling on Meesho at prices that are reduced by several times.

This is not the first time that such allegations have surfaced against Meesho. It has earlier received an FIR in Lucknow for counterfeit Rolex watches that the Meesho sellers sole on the platform. The search for Rolex watches doesn't come with any results now. Though the spokesmen of the company are speaking for Meesho, claiming that all the products selling on the platform go through several rounds of quality checks and that the company is doing its part to curb the counterfeit listings, these products still appear on it. The counterfeit products and their sale should be checked anyhow by the company if it doesn't want to risk its position in the eCommerce industry that is booming in India.

Meesho received an ex-parte injunction order sanctioned by the Delhi High Court to shield the business against fake websites. Meesho had earlier asked for a permanent injunction on fake websites that uses the Meesho trademark and/or copyright to deceive the customers. This has been finally granted when the Delhi HC issued the β€˜John Doe’, or the Ashok Kumar order, an ex-parte injunction that safeguards the intellectual property of a creator and is against the anonymous offenders who want to dupe the customers. According to the order, the following action will be taken:

  • The fake websites that are infringing the Meesho copyright as identified by Meesho, would be blocked/suspended by all the relevant Domain Name Registrars within 48 hours.
  • A blocking order is issued for the infringing domain names where the Department of Telecommunications (DoT) and the Ministry of Electronics and Information Technology (MeitY) should act as per the High court orders.
  • There should be no more fake websites/domains containing the β€˜Meesho’ trademark the registration of which would be overseen by the DNRs and the Internet Service Providers (ISPs).
  • Besides, the banks have also been ordered to instantly freeze accounts that are associated with fake websites.

Meesho Smear Campaigns

Meesho announced that a smear campaign was raging against the company, which is why it sent a legal notice to the social media influencers and the people associated with them, as per the reports dated June 7, 2022. This was not the first time when the company noticed such incidents, Twitter users, Udita Pal and Aashima Arora were earlier involved in defaming Meesho against monetary benefits. On Meesho smear campaigns, the Advertising Standards Council of India (ASCI) has replied that if the influencers have received money to post tweets against Meesho to soil the company's name and reputation, then they are liable for prosecution, as of June 10, 2022 reports.


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Meesho - Future Plans

By December 2022, Meesho hopes to have 100 million monthly transactional users, which it did as of June 2022. It plans to use the investments that it received in the latest funding round to double its technical and product skills, expand its product roster to over 50 million goods, and become India's preferred platform for users, entrepreneurs, and sellers.

Farmiso (Meesho Grocery), Meesho's community group purchasing (CGB) company, is also trying to extend its grocery and fast-moving consumer products services to over 200 cities. The startup is enabling first-time customers in India's tier II markets to purchase from a large assortment of foods at ticket sizes as low as $1-2 by making online grocery shopping cheap.

β€œThe next wave of growth in India’s digital consumerism will undoubtedly come from Bharat. We’ve always focused our efforts on enabling entrepreneurs from tier II-plus markets to expand their business and, in turn, uplift small economic pockets in the country,” said Vidit Aatrey, founder and chief executive officer, Meesho,β€œThe new round brings us a step closer to realising our mission to democratise internet commerce for all, increase regional participation in the digital economy, and add momentum to local businesses.” The CEO said after the company raised the Series F Β round of funding in Sepetmeber 2021.

Vidit Aatrey mentioned Meesho's plans to list on the bourses in the next 12-24 months, as per the news dated June 13, 2022. However, the CEO of Meesho didn't quite ascertain whether the company would be listed on the Indian stock markets or of the US. Aatrey also confirmed that the startup would also be looking to achieve profitability by that time. Β 

FAQs

What is Meesho shop?

Meesho, which was formed as "meri eshop", was founded as a social commerce platform in 2015 by Sanjeev Barnwal, Vidit Aatrey, and operates as an online reselling app for the users. Meesho has recently started pivoting an eCommerce model. Β 

What does Meesho do?

Meesho, based in Bengaluru, is an online-reseller platform that aspires to build an environment where anybody can establish a business with no financial investment.

Who founded Meesho?

Meesho was founded by Sanjeev Barnwal and Vidit Aatrey in 2015.

When was Meesho founded?

Meesho was founded in 2015.

Which companies do Meesho compete with?

4Volusion, Elenas, DealShare, GlowRoad, Shop101, CityMall, Bulbul.tv, SimSim, Volusion, Magento, ALIPPO, Huboo, and Drop are among Meesho's major rivals.

How to close Meesho account?

You can easily close your Meesho account, and there are 3 convenient steps you can follow to do it:

  • You can email the company
  • You can call the company and ask them to close your Meesho account
  • You can message the Twitter or Facebook handle of the Meesho company to delete your account

What does Meesho supplier offers?

Meesho supplier helps the Meesho sellers to sell online to 12+ cr customers at 0% commission.

How to log out from Meesho?

You can log out from the Meesho supplier app without any hassles just by clicking on the Log Out option.

What is the Meesho care number?

The Meesho care number is 080-61799600.

What are the Meesho return charges?

Meesho return charges if the product is returned within the SLA is 0.

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