Rocketships & EVs

Moats, Modern Sodas & Overlords

Hi Surgies 👋

Raiding your inboxes a couple of days late this week. There’s been a ton of announcements on the quick commerce front. Everyone wants in. Looks like a 10-minute delivery is going to be table stakes for most categories in a year. Speaking of categories, the quick commerce category managers are the new overlords for D2C brands.

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🗞️Marketplace Buzz

• Zepto is a rocket ship. The company’s operating revenue more than doubled year-on-year to ₹4,454 crore in the financial year ended March 2024. Its loss for the period remained flat at ₹1,248 crore, against ₹ 1,272 crore in the year-ago period. CEO Aadit Palicha expects to “continue this growth momentum with a clear path to PAT profitability in the near term”. The biggest change has come in reduced contribution margin loss or the loss per order after deducting variable costs (product price, delivery fees, etc) but before deducting fixed expenses such as employee salaries and marketing.

• Amazon now has 10,000 electric vehicles in its India delivery fleet. The company is now testing electric heavy goods vehicles between Bengaluru and Chennai. Amazon has developed custom EVs through collaborations with leading manufacturers. The company also enables affordable financing for electric two-wheelers, three-wheelers and trucks, helping to lower adoption barriers among delivery service providers and delivery associates, working with fintech firms

• Meesho FY24 revenue jumped 33%. Number of users is up 25% to 175 million. The company reported a 33% increase in the revenue from operations to Rs 76,150 million, largely driven by the rise in annual transacting users and repeat purchases from existing customers.

  

• Most established players such as Reliance (Tira) and Flipkart (Myntra) are jumping on the beauty bandwagon following Nykaa's playbook. Check out how the first-mover is safeguarding its lead.

• FirstClub, a rapid delivery startup, raised $8 million. The startup plans to sell premium products in the packaged foods, fresh foods, bakery, dairy, and nutrition categories to the top 10% of the Indian population residing in metro cities. FirstClub will focus on Bengaluru for the first 12 months.

  • Speaking of rapid delivery Ola has joined the race. The company plans to establish its dark stores due to increasing demand for quick delivery services

• More on the rapid front. Food now. Blinkit launched a quick food delivery service app Bistro, and there are more coming...

  • Zomato -> Bistro

  • Zepto -> Zepto Cafe

  • Swiggy -> Bolt & Cafe

  • Swish (in BLR, independent)

  • Zing (in NCR, independent)

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🍕D2C Snippets

• Despite posting record profits of Rs 40.2 crore in Q1FY25, Mamaearth reported a net loss of Rs 19 crore in Q2FY25. Its second-quarter revenue declined 17% quarter-on-quarter to Rs 461.82 crore, falling short of the Rs 500 crore benchmark. Check out a long read on Mamaearth’s inventory woes and financials, pointing to an aggressive inventory push before its IPO.

• Lenskart is investing Rs 1500 crore in setting up what is touted as the world’s largest eyewear manufacturing factory in Telangana. The facility will make eyewear, lenses, sunglasses, accessories and other products catering to India as well as exports to other markets in Southeast Asia and the Middle East.

• Never too late in the Qcomm world: The milk and grocery platform Country Delight has reportedly entered the instant delivery space. The Gurugram-based company has launched a pilot of 10-15 minute delivery in Gurugram. On this note, hyper-local e-commerce platform Magicpin has also entered into the quick commerce segment to deliver food. The company has launched the magicNow brand which will work for over 2,000 food brands and 1,000 merchants.

📢Power Talk

“This generation is trend first rather than brand first”, Nandita Sinha, CEO, Myntra

📚Reads and Recommendations

• Check out Kalaari Capital’s note on India - Techade of Opportunity. It projects GDP contribution by Indian startups to be north of $100 Billion by 2030

• Content marketing ROI. TLDR: Short-form videos don’t cut it

  

• Modern Soda is now a category. These sodas have emerged as one of the hottest segments in beverage over the past half-decade, as reflected by the rapid ascent of Poppi and OLIPOP PBC (~$1 Billion in annual sales)

• Optimise your Meta campaigns with this hack by the folks at Shopflo.

• One of the hottest trends in Chinese consumer internet this year. Revenue from short video dramas — serialized stories of 1-2 minute episodes typically totalling 60-120 minutes, designed for vertical viewing on phones—has surpassed movie box office.

• What’s your startup moat?

That’s all for this week! Bye!

Folks at some companies have told us this newsletter is almost mandatory weekly reading for their teams 🥰. If your company is not in on it yet, get your teams on the latest in the e-commerce space every week.

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