Thriving Thrasio Model in India’s Startup Ecosystem

With online shopping becoming an integral part of our lives, the Indian e-commerce sector is gearing up for unprecedented growth, projected to surge at an impressive CAGR of 27% by 2026. While numerous businesses find a platform on giants like Amazon, carving a distinctive identity and expanding their markets can be a daunting task.

Enter the game-changers of the e-commerce realm - the roll-up commerce companies. Among them stands the mighty Thrasio model, poised to revolutionize India’s startup landscape, igniting a blaze of growth and success for countless aspiring entrepreneurs. Get ready to dive into the realm of roll-up commerce and explore the incredible potential it holds for the Indian startup ecosystem!

Understanding the Thrasio Model

This concept of roll-up commerce was first successfully adopted and used by a US-based company Thrasio that became profitable quite early. The business model calls for identifying brands that have the potential to grow, acquiring them or associating with them and then working to expand their reach. The company that takes over these brands helps them in expansion of sales, improved financial growth and the scalability of the brand.

The Journey of ThrasioInspired Indian Startups

Hoping to mirror the success and fortunes of the US firm, several Indian entrepreneurs launched in 2021, startups with a similar business model. These Thrasioinspired Indian ventures raised over $800 million in funds, both via the equity and the debt route.

¡ Mensa Brands- Founded in May 2021 by former CEO of Myntra, Ananth Narayaan, this venture has raised $335 million. The venture was valued at $1000 million in November 21. Mensa Brands reported a total income of Rs 217.89 crore and net loss of Rs 96.62 crore in FY22, its first year of operations. The brands acquired by Mensa include Pebble, Pretty Krafts, Karagir, MyFitness, MensXP, iDiva, and Hypp.

¡ 10 Club- Founded by Bhawna Suresh, this Bengalaru-based company acquires young e-commerce product sellers in the home and fitness categories, and scales them up. Prominent brands in 10club’s portfolio include Kraftseeds, Gate Garden and Kriti Kalash.

¡ Powerhouse91- The roll up e-commerce venture was founded in 2021 by Aqib Mohammed and Shashwat Diesh. Powerhouse91 has acquired several personal care brands, sports and fitness and general wellness brands.

¡ GlobalBees- This venture was founded by Nitin Agarwal of Edelweiss Financial and Supam Maheswari, founder of FirstCry. GlobalBees raised $260 million and acquired brands like ReyNaturals, HealthyHey, Absorbia, Yellow Chimes, Prolixr and The Better Home.

¡ GOAT Brand Labs- Formed by Flipkart Fashion Director Rishi Vasudev, this venture had received $86 million funding and acquired several digital-first D2C brands in the lifestyle segment.

¡ Upscalio- This Gurgaon based venture was founded in 2021 by Gautam Kshatriya, a former Mckinsey consultant, Saaim Khan and Nitin Agarwal. It was able to raise $60 million funding from several investors.

¡ Evenflow Brands-This startup was founded in 2021 by ex-Uber executives Utsav Agarwal and Pulkit Chhabra.

The success of these businesses will depend on several factors like the pricing at which they acquire the brands and the funding method used by them. Acquisitions at exorbitant prices can create trouble and affect the valuations of these ventures. The segment is likely to witness consolidation in the near future with only two or three top players who have managed to secure a good amount of funding are likely to survive in the long run.

The ongoing funding winter and the stagnating growth in the D2C segment are also hampering the growth of many of these roll-up commerce ventures.