Snapdeal

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Snapdeal
Snapdeal logo new.png
Screenshot
Snapdeal desktop homescreen
Type of business Private
Type of site
E-commerce
Available in English
Founded 2010; 8 years ago (2010) [1]
Headquarters New Delhi, India
Area served India
Founder(s) Kunal Bahl
Rohit Bansal
Industry Internet
Services Online shopping
Website www.snapdeal.com
Alexa rank 1,137 (May 2018)[2]
Registration Required
Current status Online
Native client(s) on iOS, Android, Windows

Snapdeal is an Indian e-commerce company based in New Delhi, India. The company was started by Kunal Bahl and Rohit Bansal in February 2010. As of 2014, Snapdeal had 300,000 sellers, over 30 million products across 800+ diverse categories from over 125,000 regional, national, and international brands and retailers and a reach of 6,000 towns and cities across the country.[3]

Investors in the company include SoftBank Corp, Ru-Net Holdings, Tybourne Capital, PremjiInvest, Alibaba Group, Temasek Holdings, Bessemer Venture Partners, IndoUS Ventures, Kalaari Capital, Saama Capital, Foxconn Technology Group, Blackrock, eBay, Nexus Ventures, Intel Capital, Ontario Teachers' Pension Plan, Singapore-based investment entity Brother Fortune Apparel and Ratan Tata.[4] Snapdeal acquired FreeCharge for $400 million.[5]

History[edit]

Snapdeal was started on 4 February 2010 as a daily deals platform, but expanded in September 2011 to become an online marketplace.[6] The move came as a surprise to investors, since the company had a 70 percent share in the daily deals business.[7] Snapdeal has grown to become one of the largest online marketplace in India[8] offering an assortment of 10 million products across diverse categories from over 100,000 sellers, shipping to more than 5,000[9] towns and cities in India. In March 2015, Snapdeal brought actor Aamir Khan for the promotion of its website in India.[10] In October 2017, According to the reported, Snapdeal's CFO Anup Vikal resigned.[11][12][13]

Funding[edit]

Snapdeal has received several rounds of funding. It received its first funding worth USD $12 million from Nexus Venture Partners and Indo-US Venture Partners in January 2011. This was followed by another round in July 2011 worth USD $45 million from Bessemer Venture Partners and existing investors. The third round of funding was worth USD $50 million and came from eBay and other pre-existing investors.[14]

Three years later, in February 2014, Snapdeal raised funding of USD $133 million. This round was led by eBay with participation from then-current institutional investors: Kalaari Capital, Nexus Venture Partners, Bessemer Venture Partners, Intel Capital and Saama Capital.[15] In May of the same year, funding worth USD $105 million was raised. This was backed by investors BlackRock, Temasek Holdings, PremjiInvest and others.[16] Softbank invested USD $647 million in October 2014, making it the largest investor in Snapdeal so far.[17]

In August 2015, Alibaba Group, Foxconn and SoftBank invested USD $500 million as fresh capital.[18] In February of the following year, one of the world's largest pension funds, Ontario Teachers' Pension Plan, and Singapore-based investment entity Brother Fortune Apparel, led an investment worth USD $200 million in the Jasper Infotech-owned company.[19]

In May 2017, Snapdeal raised funding worth Rs 113 crore funding from Nexus Venture Partners.[20][21]

Acquisition[edit]

Snapdeal has acquired several business enterprises. In June 2010, Snapdeal owners Jasper Infotech Pvt Ltd acquired Bengaluru-based group buying website Grabbon.com for an undisclosed amount.[22] In April 2012, Delhi-based online sports goods retailer esportsbuy.com was acquired.[23][24] This was followed in 2013 by the acquisition of Shopo.in, an online marketplace for Indian handicraft products.[25] In 2014, SnapDeal acquired Doozton.com, a fashion product discovery technology platform,[26] and Wishpicker.com, a tech platform that uses machine learning to deliver recommendations for gift purchases. Both deals were for undisclosed amounts.[27][28]

Snapdeal made majority of its acquisitions in the year 2015. In January, it acquired a stake in product comparison website, Smartprix.com[29] followed by the acquisition of luxury fashion products discovery site, Exclusively.in.[30] In March, the firm acquired 20% stake in logistics service company Gojavas.com.[31] Two more acquisitions in the same month were eCommerce management software and fulfillment solution provider, Unicommerce.com[32] and RupeePower, a digital platform for financial transactions.[33][34][35] In April 2015, mobile-payments company FreeCharge.com was acquired.[36] Programmatic display advertising platform, Reduce Data was acquired in September of the same year.[37]

In August 2016, logistics firm Pigeon Express acquired a 51% stake in GoJavas with Snapdeal holding 49% stake in the firm.[38]

Merger[edit]

In August 2016, rumors surfaced through a VCCircle exclusive article that Snapdeal was considering possibilities[39] of mergers with its bigger rivals Flipkart and Amazon. The speculations about a possible merger became more concrete in April 2017 when a number of media houses reported that Softbank, one of the major investors in Snapdeal, wanted the company to merge with Flipkart.[40] The discussions on merger with Flipkart went on for a number of months and ended in July 2017 when the deal failed to get approved by 100% of investors as required by the terms put forth by Flipkart.[41] Founders' opposition to the deal,[42] several indemnity clauses related to Snapdeal's financials and minority stakeholders' discontentment over special payouts to Kalaari Capital and Nexus Venture Partners, Snapdeal's early investors, were among the many reasons that lead to the breakdown of the deal.[43] This was followed by Snapdeal's founders taking a decision to continue operating Snapdeal as an independent company with Snapdeal 2.0 as their new vision.[44]

However, amid the merger discussions, Freecharge, a mobile payments company bought by Snapdeal in April 2015, was sold to Axis Bank for $60 million.[45] Freecharge was originally acquired by Snapdeal for $400 million making it one of the biggest acquisitions in Indian startup space.

Business results[edit]

In the year 2012-13, Snapdeal had said that it expected revenues of about 600 crore (US$84 million). Betting big on the growth of mobile commerce, Kunal Bahl, the CEO, said at the time that 15-20 per cent of the sales on Snapdeal came through m-commerce. Snapdeal.com expected the total sale of products traded on its platform to cross 2,000 crore (US$280 million) in the fiscal year 2013-14 helped by its robust growth in the past two years and the growing popularity of e-commerce in India.[46] In June 2014, Snapdeal announced that it had achieved the milestone of 1000 sellers its platform getting sales of over Rs 1 crore.[47] Jasper Infotech Pvt. Ltd led Snapdeal registered a revenue growth of 56% to Rs 1,457 crore from Rs 933 crore, but incurred 150% increase in loss from Rs 1,328 crore in the year ended 31 March 2016[48] The year-to-March 2016 numbers includes the financials of digital payments platform Freecharge, which was acquired by Snapdeal in April 2015[49] There was a 40% drop in revenue to Rs 903 crore in the fiscal year ending in 2017. In an official letter released to employees, Snapdeal announced that it had become profitable for the first time in the month of June, 2018; becoming the first major Indian e-commerce company to achieve the feat. [50]

Labour issues[edit]

Snapdeal employees approached the Labour Department in February 2016, claiming that the company was firing them and had forced 600 employees to resign in the last one year.[51]

After protests from Snapdeal employees, Delhi Government ordered the Labour Department to probe the allegations.[52]

Aamir Khan controversy[edit]

Snapdeal was criticized for Aamir Khan's statement[53] during a conversation with Anant Goenka, Wholetime Director & Head — New Media, The Indian Express, at the eighth edition of the Ramnath Goenka Excellence in Journalism Awards.[54] Snapdeal terminated Aamir Khan as a brand ambassador in February 2016[55] after an official statement released in response to the controversy.[56] Aamir Khan had been hired as Snapdeal's brand ambassador in February 2015 for its "Diwali Dil Ki Deal-wali" campaign.[57]

See also[edit]

References[edit]

  1. ^ Chakraborty, Alokananda (18 July 2014). "Lunch with BS: Sachin Bansal". Business Standard Ltd. Retrieved 16 November 2014. 
  2. ^ "Snapdeal.com Site Info". Alexa Internet. Retrieved October 21, 2016. 
  3. ^ Gooptu, Biswarup (28 February 2014). "Snapdeal co-founder Kunal Bahl: A rising star of India's e-commerce space". The Economic Times. Retrieved 16 November 2014. 
  4. ^ "Venture Backed Startups turn Acquisitive". Venture Intelligence. 
  5. ^ "Snapdeal buys Freecharge for $400m - The Times of India". The Times of India. Retrieved 2015-11-19. 
  6. ^ Agrawal, Shrija; Rai, Anand. "We should do a billion dollar in gross merchandise value by 2015: Snapdeal's Shyam Bahl". techcircle.vccircle.com/. Retrieved 16 November 2014. 
  7. ^ http://www.newspatrolling.com/snapdeal-company-profile/
  8. ^ Bhattacharjee, Nivedita; PM, Indulal. "Japan's SoftBank kicks off $10 billion India online spree, buys stake in Snapdeal". Reuters. Retrieved 16 November 2014. 
  9. ^ "JOSIC - Digital Intelligence". 
  10. ^ "Aamir Khan roped in as brand ambassador for Snapdeal". India Today. Retrieved 18 March 2015. 
  11. ^ Gooptu, Biswarup (2017-10-17). "Snapdeal's CFO Anup Vikal puts in his papers". The Economic Times. Retrieved 2017-10-18. 
  12. ^ "Snapdeal CFO resigns two months after company called off Flipkart merger". Moneycontrol. Retrieved 2017-10-18. 
  13. ^ "Snapdeal CFO Anup Vikal quits". Zee Business. 2017-10-17. Retrieved 2017-10-18. 
  14. ^ "Exclusive: Snapdeal raises $50 million from eBay and existing investors". 1 April 2013. 
  15. ^ "eBay increases stake in Snapdeal, invests $134 million". The Times Of India. 27 February 2014. 
  16. ^ "Snapdeal raises $100M in fresh funding from BlackRock, Temasek, PremjiInvest, others". 
  17. ^ "SoftBank becomes largest investor in Snapdeal" Archived 28 October 2014 at Archive.is, Affairscloud" , 28 October 2014.
  18. ^ "Snapdeal secures USD 500 Million in an investment round led by Alibaba, Foxconn and SoftBank to power its digital commerce ecosystem - Snapdeal Blog". 18 August 2015. 
  19. ^ "Ontario Teachers' Pension Plan and others lead $200 million funding round in Snapdeal". The Economic Times. 15 February 2016. Retrieved 19 August 2017. 
  20. ^ "Snapdeal gets Rs113 crore from Nexus, founders in surprise funding". Livemint. 29 May 2017. 
  21. ^ "Struggling Snapdeal gets Rs 113 cr funding". The Economic Times. 29 May 2017. 
  22. ^ Shrija Argawal, "SnapDeal owners acquire Grabbon; to expand & differentiate," Reuters, June 29, 2010.
  23. ^ "Snapdeal acquires Esportsbuy.com". Economic Times. 4 April 2012. 
  24. ^ "Snapdeal buys Esportsbuy.com". The Hindu Business Line. 4 April 2012. 
  25. ^ "Snapdeal acquires Shopo.in". The Times of India. 1 June 2013. 
  26. ^ Priyanka Pani, "Snapdeal.com buys fashion products discovery platform Doozton.com," The Hindu Business Line, April 16, 2014.
  27. ^ "Snapdeal acquires gifting recommendation tech firm Wishpicker," The Economic Times, December 11, 2014.
  28. ^ "Snapdeal, One Of India’s Leading E-commerce Sites, Acquires Wishpicker To Deliver Better Product Recommendations," TechCrunch, December 11, 2014.
  29. ^ "Snapdeal buys stake in product comparison site Smartprix.com". VC Circle. Retrieved 2014-01-06. 
  30. ^ ", Business-standard", 18 February 2015.
  31. ^ "Snapdeal acquired 20% stake in Gojavas.com". LiveMint. Retrieved 2015-03-18. 
  32. ^ "Snapdeal buys e-commerce management firm Unicommerce". LiveMint. Retrieved 2015-03-31. 
  33. ^ "Snapdeal acquires majority stake of RupeePower". articles.economictimes.indiatimes.com. Retrieved 2015-04-01. 
  34. ^ "Snapdeal acquires majority stake of RupeePower". MoneyControl. Retrieved 2015-03-31. 
  35. ^ "Snapdeal acquires majority stake of RupeePower". The Times Of India. Retrieved 2015-03-31. 
  36. ^ "India's Snapdeal Buys FreeCharge". The Wall Street Journal. Retrieved 2015-04-08. 
  37. ^ "Snapdeal acquires Silicon Valley startup Reduce Data - The Economic Times". Retrieved 2015-09-02. 
  38. ^ "Pigeon Express in talks to buy out Snapdeal's GoJavas stake - Live Mint". Retrieved 2017-05-04. 
  39. ^ "The backstory of how Snapdeal pivoted and pivoted — and then lost the plot". FactorDaily. 2017-04-06. Retrieved 2017-05-05. 
  40. ^ "SoftBank Aiming for Flipkart-Snapdeal Merger, Rest of the Investors in a Disagreement - TechStory". TechStory. 2017-04-05. Retrieved 2017-08-01. 
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  42. ^ "Snapdeal 2.0 has little hope: 5 reasons why the deal with Flipkart snapped". Business Standard. 9 August 2017. 
  43. ^ "How Kunal Bahl sold the idea of Snapdeal 2.0 and what's in store". The Economic Times. 1 August 2017. 
  44. ^ "Full text: Let's make Snapdeal 2.0 a success, says Bahl and Bansal's letter". Business Standard. 1 August 2017. 
  45. ^ "After Flipkart-Snapdeal Merger, Axis Bank Acquires Freecharge - TechStory". TechStory. 2017-07-27. Retrieved 2017-08-01. 
  46. ^ "Snapdeal expects its online sales to cross Rs 2,000 cr in FY14". The Times Of India. 31 March 2013. 
  47. ^ "Snapdeal crosses milestone of 1,000 sellers getting sales of over Rs 1 crore". IndianWeb2. 16 June 2014. 
  48. ^ "Snapdeal loss more than doubles to Rs3,316 cr in FY16". LiveMint. 18 January 2016. 
  49. ^ "Snapdeal acquires Freecharge to expand e-commerce ecosystem". LiveMint. 10 April 2015. 
  50. ^ "Snapdeal's revenue down almost 40% at Rs 903 crore in FY 17 - Times of India". The Times of India. Retrieved 2018-07-11. 
  51. ^ "Protesting Snapdeal employees approach labour department - The Economic Times". The Economic Times. Retrieved 2016-02-28. 
  52. ^ "Snapdeal is Indirectly Firing 200 Employees? Ugly Truths Emerge." Trak.in - Indian Business of Tech, Mobile & Startups. Retrieved 2016-02-28. 
  53. ^ "E-commerce marketplace snapdeal faces flak over aamir khans statement on intolerance". www.business-standard.com. 
  54. ^ "Aamir Khan joins intolerance debate". www.indianexpress.com. 
  55. ^ "Snapdeal not to renew Aamir Khans contract as brand ambassador". www.economictimes.indiatimes.com. 
  56. ^ "Snapdeal releases official statement on Aamir Khan controversy". www.economictimes.indiatimes.com. 
  57. ^ "Snapdeal launches Diwali-dil-ki-deal-wali campaign". www.news18.com. 

External links[edit]