 "Now, hyperlocal delivery only a text away")
Seeing his mother use WhatsApp to order grocery, "serial entrepreneur" Deepak Ravindran was inspired to develop a chatting app to help users connect with merchants, retailers and restaurateurs.
Ravindran, who had earlier launched text-based search engine Innoz and mobile knowledge platform Quest, launched Lookup - a free messaging app to help people connect with local business - in 2014, in Bengaluru. It allows one to order food, get product information, have grocery delivered home and make reservations in restaurants.
Chat to connect
Lookup hyperlinks every local store with a chat app, providing customers information about stores that have been verified.
"Chatting is convenient," said Ravindran. Customers can make a shopping list, take a picture and send it to the grocer. The goods are delivered home.
They do not need to place a minimum order and can track purchases. Beside paying cash on delivery, they can use a mobile wallet, Lookup Cash.
Lookup has partnered with logistics start-ups such as Roadrunnr and Delhivery to help small businesses deliver goods.
There is a distinction, said Ravindran, between Lookup and other apps that list products. "People who use our app have already decided what they want to buy. I think of Justdial as direct competition." Justdial provides search services through phone and the internet.
Customers do not need to sign into the app. A simple search shows all the local stores. Their messages are routed through a call centre and the response time is five minutes.
The call centre helps both the customers and the businesses. The latter do not get customers' contact details, ensuring security. They have to select the "Claim your business" option to get their store on the app.
Money matters
In October, Lookup raised $2.5 million (about Rs 16 crore) in a Series-A funding, led by Vinod Khosla's personal fund, Khosla Impact. Other participants were Twitter co-founder Biz Stone, Narayana Murthy's Catamaran Ventures, Global Founders Capital, and European investment fund Rocket Internet.
"Chatting has become disruptive, simplifying transactions," said Sandhya Hegde, a partner at Khosla Impact. "Disruptive start-ups are popular in India. But, teams need to stay ahead of the game as software gets copied in weeks. Constant innovation is key to success."
Vinod Khosla said his company estimates there are 40,000,000 small businesses in India. His company is helping Lookup connect customers to these businesses. The funds will help expand Lookup's merchant base and branch out into new regions. Lookup currently operates in Bengaluru, Mumbai, Delhi and Pune. It plans to expand to 15 cities by next year.
It has established multiple revenue streams, making money on three primary assumptions - a transaction cut on every purchase, in-app advertising and through lead generation.
Looking ahead
At present, Lookup has 85,000 shopkeepers on board. It is planning to take the number to 1,000,000 by the next year. It has a million users and aims to touch the five million mark soon.
Available on both the Android and iOS platforms, Lookup has recently launched a vendor assistance helpline, on which businesses can call to get verified. Customers also have the option of lodging a complaint.
According to Ravindran, it also plans a separate app for shopkeepers from next month. It will allow them to know which shops in the vicinity are performing better.
He sees challenges coming from companies giving huge discounts. "User adoption will take time, as chatting and buying is a new mode of commerce. Our challenge lies in differentiating ourselves from the apps offering discounts," he said.
FACT BOX
EXPERT TAKE
Lookup currently has its own workforce of 100 employees mediating between the vendors and the customers and as the company scales, an increasing support staff could be a significant cost. Promoters should start working with various analytics and automation of mediation to minimise the staff costs and also increase the efficiency.
Considering the current scenario of intense competition for funding, the company needs to find a way to scale faster with a lower staff and marketing cost. This will give it a critical mass to monetise the product either by way of charging a nominal fee per user or on the basis of the transactions consummated through the app.
There are call centre-based businesses like JustDial, Ask Laila and Askme, which respond to customer queries over phone. However, these businesses share the customer information with telemarketers and the customers are troubled with continuous marketing calls. Customers of Lookup like the security and privacy feature of the app and the company needs to ensure that this feature functions efficiently.
Ravindran, who had earlier launched text-based search engine Innoz and mobile knowledge platform Quest, launched Lookup - a free messaging app to help people connect with local business - in 2014, in Bengaluru. It allows one to order food, get product information, have grocery delivered home and make reservations in restaurants.
Chat to connect
Lookup hyperlinks every local store with a chat app, providing customers information about stores that have been verified.
"Chatting is convenient," said Ravindran. Customers can make a shopping list, take a picture and send it to the grocer. The goods are delivered home.
They do not need to place a minimum order and can track purchases. Beside paying cash on delivery, they can use a mobile wallet, Lookup Cash.
Lookup has partnered with logistics start-ups such as Roadrunnr and Delhivery to help small businesses deliver goods.
There is a distinction, said Ravindran, between Lookup and other apps that list products. "People who use our app have already decided what they want to buy. I think of Justdial as direct competition." Justdial provides search services through phone and the internet.
Customers do not need to sign into the app. A simple search shows all the local stores. Their messages are routed through a call centre and the response time is five minutes.
The call centre helps both the customers and the businesses. The latter do not get customers' contact details, ensuring security. They have to select the "Claim your business" option to get their store on the app.
Money matters
In October, Lookup raised $2.5 million (about Rs 16 crore) in a Series-A funding, led by Vinod Khosla's personal fund, Khosla Impact. Other participants were Twitter co-founder Biz Stone, Narayana Murthy's Catamaran Ventures, Global Founders Capital, and European investment fund Rocket Internet.
"Chatting has become disruptive, simplifying transactions," said Sandhya Hegde, a partner at Khosla Impact. "Disruptive start-ups are popular in India. But, teams need to stay ahead of the game as software gets copied in weeks. Constant innovation is key to success."
Vinod Khosla said his company estimates there are 40,000,000 small businesses in India. His company is helping Lookup connect customers to these businesses. The funds will help expand Lookup's merchant base and branch out into new regions. Lookup currently operates in Bengaluru, Mumbai, Delhi and Pune. It plans to expand to 15 cities by next year.
It has established multiple revenue streams, making money on three primary assumptions - a transaction cut on every purchase, in-app advertising and through lead generation.
Looking ahead
At present, Lookup has 85,000 shopkeepers on board. It is planning to take the number to 1,000,000 by the next year. It has a million users and aims to touch the five million mark soon.
Available on both the Android and iOS platforms, Lookup has recently launched a vendor assistance helpline, on which businesses can call to get verified. Customers also have the option of lodging a complaint.
According to Ravindran, it also plans a separate app for shopkeepers from next month. It will allow them to know which shops in the vicinity are performing better.
He sees challenges coming from companies giving huge discounts. "User adoption will take time, as chatting and buying is a new mode of commerce. Our challenge lies in differentiating ourselves from the apps offering discounts," he said.
FACT BOX
- Inception: 2014
- Founder: Deepak Ravindran
- Area of Business: Hyperlocal text messaging app
- Funds Raised: $382,000 in a seed round in January and $2.5 million in a Series-A round in October
EXPERT TAKE
Lookup currently has its own workforce of 100 employees mediating between the vendors and the customers and as the company scales, an increasing support staff could be a significant cost. Promoters should start working with various analytics and automation of mediation to minimise the staff costs and also increase the efficiency.
Considering the current scenario of intense competition for funding, the company needs to find a way to scale faster with a lower staff and marketing cost. This will give it a critical mass to monetise the product either by way of charging a nominal fee per user or on the basis of the transactions consummated through the app.
There are call centre-based businesses like JustDial, Ask Laila and Askme, which respond to customer queries over phone. However, these businesses share the customer information with telemarketers and the customers are troubled with continuous marketing calls. Customers of Lookup like the security and privacy feature of the app and the company needs to ensure that this feature functions efficiently.
P Ramakrishna is a general partner at seed fund Utthishta LLP