We Are Expecting To Acquire 25–30 Brands By FY 23: Gautam Kshatriya, CEO & Co-Founder, Upscalio
We are in conversations with many, many more D2C entrepreneurs that are excited to partner with us.
Why do you think India needs a model like thrasio models since there are a lot of startups already who are working in this space? Future ahead for thrasio models in Indian Landscape?
The benefit of the e-commerce roll-up model, especially the way that UpScalio pursues it, beyond capital, is that it provides hands-on support to help fledgling D2C startups accelerate their growth.
I am truly astounded, on a daily basis, with the kind of amazing entrepreneurs that our country has. India is by no means an easy market to build a business - yet day after day I come across entrepreneurs that have built fantastic brands, often fully bootstrapped and with very little outside help.
What we see however, is that after these impressive entrepreneurs achieve a certain scale, they can start to face barriers to growth. This may be in the form of working capital, and often in the ability to hire expert talent to take their business to the next level.
The UpScalio’s team is able to hire top-notch talent and deploy that talent across multiple brands. Our experts help increase revenue through levers such as digital marketing, e-commerce storefront optimization, and demand and inventory planning to reduce stockouts.
The future of e-commerce roll-ups in India is very bright. Today, we estimate there are over 3000 private label brands on marketplaces such as Amazon and Flipkart that are doing at least Rs. 5Cr in ARR, just in the utility segments. By 2025, there will be at least 15,000 such brands on marketplaces that are doing at least Rs. 5 Cr. in ARR.
This presents an a very exciting opportunity for UpScalio to partner with work with fantastic brands and work towards taking them to the next level.
You have acquired 8 e-commerce brands, by the end of the financial year 21-22 how many brands will you require?
We will have a total of about 12-15 brands by FY22, and 25-30 brands by FY 23
How are the people and brands responding to your roll-up start-up?
The response has been great - from D2C entrepreneurs, our colleagues and from investors.
8 brands have already partnered with us in just 6 months, and we aim to take this number to a total of 12-15 over the next few months. We are in conversations with many, many more D2C entrepreneurs that are excited to partner with us.
From an investor perspective, our first round was over 300 Cr. - one of the largest first rounds of capital that an Indian startup has raised. And a number of funds are continuing to engage with us for further rounds of capital.
This has all been made possible given our amazing team. We have a fantastic mix of folks that are entrepreneurial, and deeply experienced, coming from organizations such as P&G, Amazon, Flipkart, Cloudtail, McKinsey, Bain, and Purplle just to name a few. In just 6 short months, we have built up a team of 90+ professionals with expertise across the e-commerce value chain.
How is it different from the competitors?
What really sets us apart from other e-commerce roll-ups in India is that we shoulder the responsibility of running the brand from end to end.
Whether it is optimizing sourcing, warehousing logistics, delivery logistics, supply-demand planning, e-commerce storefront optimization, digital marketing, or analytics, we do it all. And not only do we claim we can do this, but we have the team to be able to do so: 90+ professionals, out of which 65 are focused on core e-commerce operations.
Moreover, we’re entrepreneurs, so we understand the challenges entrepreneurs face - and work with these founders who have bootstrapped their way into building amazing products and enterprises with pure capability and hustle.
Therefore, not only do we bring the right capabilities and knowledge, but we’re also great to work with! Just ask any of the entrepreneurs we have already partnered :
Overall - I’ll say this: acquiring stakes in brands is relatively easy. Scaling them is hard. When we partner with a brand, we commit to growing it. We take this responsibility very seriously.
Supercharging brands is our #1 priority.
What are your strategies for growth and plans for expansion? How much growth are you planning to achieve in the coming year?
Growth will come from two sources: continued partnership with brands and scaling up brands that we have partnered.
In terms of partnerships, we hope to partner 35-50 brands over the next few years.
In terms of scale up, each brand we partner with, we aim to at least 5x in a period of 2-3 years. The levers for growth include digital marketing, channel expansion, and going global - in fact we plan to enter the middle east very soon.
UpScalio aims to achieve a billion dollars in revenue within the next 5 years.
Tell us about your funding plans?
Given our exciting business model, fantastic team, and our success in partnering and scaling brands, UpScalio is constantly being approached for fundraising, and is in conversations with a number of global and Indian hedge funds, VCs and PE firms.
When did you decide to start upscalio, and why did you especially choose to start an e-commerce roll-up startup?
UpScalio is a very young company. We were incorporated in June.
E-commerce has been and continues to be a very exciting space. The first phase saw the emergence of marketplaces, followed by a second phase of digital native brands emerging in fashion, consumer electronics, and more recently, in the beauty and personal care segments.
Now I believe that we are at the beginning of a third, very exciting and explosive phase of growth via digital native brands in the ‘utility’ segment - brands that sell high quality functional products, e.g. home, kitchen, automotive, and baby products. A few years ago, only a limited number of consumers would shop for a study chair, a kitchen appliance, or a car accessory online. Now, the Indian consumer has evolved. She demands more unique products, and is comfortable shopping for them online.
Launching brands in the utility D2C e-commerce space is exciting. But what I and my co-founders Saaim loved about the e-commerce rollup model was that it enables you to build something that scale up even more rapidly.
Only about 6 months old, UpScalio has a revenue run rate of Rs. 250+ Cr. In fact, in this short time, we are already close to being profitable.
That’s the fantastic thing about UpScalio’s model.
But beyond growth, the UpScalio model also gives one the opportunity to take fundamentally good brands and work together with the awesome entrepreneurs that founded them, and make them even greater brands. UpScalio’s goal is that our brands become nationally loved household names.
Finally, what we love about our model is that when we partner with great brands, we buy a stake in the companies from the founders. This unlocks wealth for them - and this is often life changing wealth for them. It creates numerous success stories, which serves to inspire other would-be D2C entrepreneurs to enter the ecosystem. Thus in our own way, we believe that we are supporting the growth and enrichment of the e-commerce ecosystem in India.
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