There is no dearth of retail grocery retailers in India, with the number touching 13 million this year. However, until a few years ago, many of these small businesses were plagued by financial woes, especially concerning upfront access to cash—such as accepting digital payments through UPI or cards, quick access to loans for expanding business, or in the form of working capital for buying new stock.
Ashneer Grover and Shashvat Nakrani startedin March 2018 in an effort to solve these problems faced by retailers daily. The company has since grown to enable 10 million merchants in 400+ cities, processing $20 billion of annualised TPV (Total Payment Volume) in payments.
In this week’s 100x Entrepreneur podcast, Shashvat and CEO Suhail Sameer speak to host Siddhartha Ahluwalia about how they’ve scaled BharatPe over the past four years, things to keep in mind while building or scaling any new product, and much more.
The core philosophy of BharatPe has been always been launching something unique which is not there in the market, the executives say.
By introducing a single QR code for small businesses to accept several types of digital payments, the company made it easy and cost-effective for retailers to accept digital payments—leading to a shift in the UPI payments landscape in India.
In 2020, it launched India’s first interoperable zero MDR QR code. It also came out with its lending product—UPI payment backed merchant advance cash, which was India’s first EDI (Electronic Data Exchange) product and was very new to merchants. The company launched its investment product, which, it says, gave returns to the tune of 10-12%.
“We will stick to our core philosophy in the future too. Whenever we will launch products, either we are disrupting the market with something unique underlying proposition or will not launch it. There have been lots of pilots for products which didn’t do well in the past. So we killed it,” says Shashvat.
Process and hustle in the business
The core DNA of BharatPe has always been innovation and speed to market, says Suhail.
“Whatever you do can’t come at a significant cost, and that’s something which we are very conscious about. Anything which makes your decision better, makes your innovation sort of more successful, or ensures that you spend lesser money testing out your innovations—we’re all sort of welcoming; beyond that we sort of try to manage process setup,” he states.
Suhail does not give too much importance to processes. According to him, processes are needed to help businesses move faster towards the end goal, or systematically add value.
Adding to it, Shashvat mentions, “It’s the art of balancing between processes and speed of execution because you don’t want to let go of the growth or the execution speed as well. Processes might help structurally, taking on some new agenda, but at the same time, it should not slow down the business.”
What’s next for BharatPe?
With a $3 billion valuation and 10 million merchants on its platform, BharatPe aims to focus further on the growth of its merchants. While the company has enabled loans for only five lakhs, Suhail says they plan to work further in this area.
Secondly, shopkeepers struggle with acquiring new customers, especially against stiff competition from ecommerce players which overwhelm consumers with a bitzkrieg of ads. BharatPe plans to help merchants in this area.
“We’re still scratching the surface. New products will keep coming; some of them will scale and some of them will get killed. But we will keep innovating, keep launching new products, figure out how we become more, and more helpful to the merchant,” states Suhail.
Plans for IPO
Speaking about IPO, Suhail says BharatPe will go for an IPO when they’re IPO ready. He clarified that if the core business is making money and is profitable, the company will be ready for an IPO.
Suhail states, “Good markets will reward great growth, even at loss. But you’re not building a business for a good market, you’re building a business for sustainability. So it has to be able to go through bad cycles and good cycles. And in bad cycles, everyone comes back to profit. People will not judge a tech business on the amount of profit it makes because they understand you’re redeploying a lot of that profit back into keeping on growing at that rate.”
“But you have to prove that you can make money because a lot of questions tech businesses face tend to be that ‘they have great service and great consumer value proposition, but will they ever make money?’ It’s a question which probably every tech business asks, but if you can prove that you can do that, I think that sort of to me is IPO-ready. And once you’ve proven that, I think it’s a great opportunity for retail investors to come in because they know the sustainability of the company,” he concludes.
To know more, listen to the podcast here:
01:35 – Expectations with BharatPe’s current scale
03:17 – Joining a Rocket Ship as a CEO
05:10 – Changes in culture and customer offerings in the last 2 years
12:19 – Very less attachment to a particular role amongst founders & CEOs
16:30 – Dealing and coming out the challenging times at BharatPe
18:17 – Zoho Sponsored – Prashant Ganti on Where do founders struggle with Payroll and how can they fix it?
19:33 – Helping the team innovate faster and plan Go-To-Market strategy
25:37 – Strengths & Weakness of Shashvat
29:33 – Strengths & Weakness of Suhail
31:03 – Handling the firing decisions
35:17 – What are the things they bond over?
36:38 – Processes v/s Hustle in 0 to 1 and 1 to 10 journey
40:49 – Secret recipe behind success at 0 to 1 on a product-level
44:02 – Idea behind building distribution network
47:33 – Suhail’s top priorities while joining BharatPe
49:29 – Biases and things Suhail had to unlearn
55:21 – Listening to Younger v/s Older Team members while decision making
58:39 – Next Chapter of BharatPe
01:01:00 – What is being IPO-ready?
01:07:39 – Things which they could have explored outside of Fintech?
(This story was updated to correct a spelling error in the headline.)
I have been writing professionally for over 20 years and have a deep understanding of the psychological and emotional elements that affect people. I’m an experienced ghostwriter and editor, as well as an award-winning author of five novels.