IMB 911

MEESHO (C): EMPOWERING INDIA’S WOMEN

ENTREPRENEURS

SRIVARDHINI K. JHA, JACQUELINE GOMES, AND SURESH BHAGAVATULA

Srivardhini K. Jha, Associate Professor of Entrepreneurship, Jacqueline Gomes, Case Writer, and Suresh Bhagavatula, Professor of
Entrepreneurship, all at the Indian Institute of Management Bangalore prepared this case for class discussion. Meesho
cooperated and provided information to IIMB in connection with the preparation of this case. No funding was received from
Meesho for the development of this case. It was reviewed and approved before publication by a company designate. This case is
not intended to serve as an endorsement, source of primary data, or to show effective or inefficient handling of decision or
business processes.

Copyright © 2021 by the Indian Institute of Management Bangalore. No part of the publication may be reproduced or transmitted
in any form or by any means – electronic, mechanical, photocopying, recording, or otherwise (including internet) – without the
permission of Indian Institute of Management Bangalore.
MEESHO (C): EMPOWERING INDIA’S WOMEN ENTREPRENEURS

As before, the founders dived deeper into their user base for insights and the way forward. Metrics showed that
more than 50% of Meesho users were women. These women were micro-entrepreneurs, reselling products within
their networks. They were using the tool to operate their businesses since most of them did not have physical outlets
and were running virtual boutiques. Home-based businesses were lucrative and viable for women who had
responsibilities at home and came from low-income families, where the monthly income was less than $403 (INR
30,000). Many users were widows, people with disabilities and homemakers, who wanted to earn something on
their own.

In India, women traditionally are sheltered and often do not have a say in any important matters in the family. They
have faced socio-cultural barriers since ages. Aatrey and Barnwal had come across women who ran small home
boutiques but were still dependent on their husbands to go out and get the products from the wholesalers. Women’s
safety was a grave issue in India, and it was often not easy for women to travel alone for business purposes.

The founders spoke to these women and understood that one of the biggest bottlenecks they faced was supplier
issues. Their reselling activity was decreasing, and in some instances, closing down due to their inability to manage
the supply-chain properly. Issues ranged from delivery of the wrong product, suppliers not accepting a product when
returned, to ignoring the entrepreneurs once the payment was complete and not facilitating a refund. Looking back,
Aatrey said:

Supplier management was debilitating for the women. They were often not allowed by their families to go
and meet the suppliers alone, so they would be heavily dependent on their husbands to accompany them
to the shops or go to the suppliers on their behalf.

The year 2016 was coming to an end, but for the Meesho team, it was the start of a new chapter, called Meesho
Supply. The idea behind Meesho 2.0 (or Meesho Supply) was to create a supplier marketplace that would make it
convenient for the women entrepreneurs to manage the supply side of their virtual stores. This new version of the
product would help the entrepreneurs find better and curated products,1 access logistics services, manage payments
(including collection of payments), and provide an easy and efficient channel to support their customers.

This business ran entirely on spreadsheets for 6 months. Then, it was time to get a little more organized. As the
product was being developed, the founders rented a small office space in Surat 2 to manage the supply side. They
assured suppliers that they would generate demand for their products on the Meesho platform. Suppliers were
relieved that they would not have to handle payments, logistics and returns. Importantly, they could see a steady
increase in demand.

Half the year had already passed, and the founders were thrilled to see that Meesho 2.0 was scaling at a faster rate
than Meesho 1.0. In mid-2017, Meesho 1.0 was closed. Barnwal explained:

It was a tough decision but one that was backed by data. Keeping Meesho 1.0 going would have consumed
lot of resources and we needed to focus where the growth was.

MEESHO 2.0 – A B2B2C PLATFORM

Meesho 2.0 gave entrepreneurs access to a huge catalog. They started to reach out to an even wider network by
sharing product images with their communities via WhatsApp, Facebook, and Instagram. They bargained over prices
of the products with the end consumers, and after reaching a common ground, placed orders on Meesho. When
placing orders, the entrepreneurs added their profit margins to the listed price of the product(s) (see image below).
Once the order was placed, the product was shipped directly to the end consumers by the suppliers or by Meesho’s

1
https://medium.com/meesho-tech/ceo-vidit-aatrey-takes-a-trip-down-memory-lane-as-meesho-turns-5-6fa76233f12 - last accessed on June
22, 2021
2
Surat is a city in the western state of Gujarat in India. It is a commercial center for textiles.

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MEESHO (C): EMPOWERING INDIA’S WOMEN ENTREPRENEURS

logistics partners. Meesho streamlined this end-to-end operation and charged a sales commission of 10-20%3 on
every order.

Source: Case writers prepared this image

Meesho kept a close eye on the metrics, analyzing average delivery time, ratings/reviews, and the return percentage.
All these factors impacted the net promoter score (NPS), but some of these also impacted the company’s cost
structure directly. For example, many returns bloated the delivery cost and Meesho’s third-party logistics partner
would bill Meesho for any return.

There was one more metric that the founders tracked – income per entrepreneur. The income generated by an
entrepreneur through Meesho was directly proportional to the number of categories they were showcasing and
selling. This in turn had a direct impact on the company’s revenue. A typical woman entrepreneur earned anywhere
between $134.6 and $201 (INR 10,000 and INR 15,000) per month, while the top 5-10% users earned around $403.8
to $511.5 (INR 30,000 to INR 38,000) per month. Meesho had started with ethnic wear since those were the most
popular items. However, with time, they added western wear, accessories, and home décor items – a move that
they hoped would increase the income per entrepreneur.

To make the onboarding process smoother, Meesho developed the Meesho Business Academy (MBA) on their
application to make it user-friendly for the new entrepreneurs. By 2020, over 2.5 million women entrepreneurs were
using Meesho and about 38,000 suppliers were listed on the platform (Exhibit 1). By mid-2020, Meesho had been
downloaded 30 million times.

Mission Rise, a women entrepreneurship summit, was launched for the entrepreneurs to gain recognition. Mission
Rise had reached 18 cities across India and by 2020 had recognized more than 1800 women entrepreneurs.

3
https://www.fastcompany.com/90457563/meesho-most-innovative-companies-2020 - last accessed on March 10, 2021

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MEESHO (C): EMPOWERING INDIA’S WOMEN ENTREPRENEURS

LOOKING AHEAD

Meesho was a category creator and a clear market leader. As of 2020, the company did not have any significant,
direct competition. However, Meesho’s success and future growth strategy was bound to bring it face-to-face with
strong competitors.

Meesho’s growth attracted venture capital. They raised multiple rounds from marquee investors (Exhibit 2),
including Facebook, which found Meesho’s focus on social commerce and enablement of small businesses to be in
alignment with its own growth strategy. Meesho grew 50 times for two consecutive years in 2017 and 2018. Since
its inception, Meesho helped suppliers reach more than 10 million entrepreneurs through its platform, who in turn
served ~25 million consumers. Alongside its stellar growth, the company was also taking rapid strides toward
achieving profitability.

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MEESHO (C): EMPOWERING INDIA’S WOMEN ENTREPRENEURS

Exhibit 1
Organization Growth Details

Quarter/Year Cities Present No. of No. of Active No. of Active No. of Orders
Employees Suppliers on Entrepreneurs Received
Platform on Platform
FY 2017-18 1,759 15 1,024 27,926 329,547
FY 2018-19 2,478 147 10,220 908,973 9,127,545
FY 2019-20 2,532 455 27,717 2,465,160 37,693,864
FY 2020-21 4,819 647 51,803 12,058,367 116,654,673

Source: Company data and Tracxn

Exhibit 2
Funding and Investment Information

Year Lead Investor Funding Amount (USD)

August 12, 2019 Naspers 100,000,000 (Series D)
June 13, 2019 Facebook 25,000,000 (Series D)
November 06, 2018 Shunwei Capital 50,000,000 (Series C)
RPS Ventures
June 05, 2018 Sequoia Capital 11,500,000 (Series B)
October 05, 2017 SAIF Partners 3,442,335 (Series A)
August 18, 2016 Venture Highway Seed funding (amount not
disclosed)
June 09, 2016 Y Combinator 120,000 (Seed)
May 05, 2016 Rajul Garg 350,000 (Seed)

Source: Data from Tracxn

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