Amazon India Makes Social Commerce Entry By Acquiring Reseller Startup GlowRoad
- ByStartupStory | April 22, 2022
Amazon India has purchased GlowRoad, a Bengaluru-based social commerce startup, in an all-cash deal, marking the company’s debut into the social commerce industry, which has seen a tremendous increase in user growth and offers a platform for businesses to sell. This is the ecommerce behemoth’s first foray into the social commerce space, where sellers and merchants utilize platforms like WhatsApp and Facebook to sell their wares and make money.
This acquisition, according to Amazon, will aid the ecommerce juggernaut in accelerating entrepreneurship among millions of innovators, homemakers, students, and small sellers around the country. GlowRoad, on the other hand, is a social commerce network that allows suppliers to sell their products to end customers through resellers in over 400 locations around the world. It was started in June 2017 by Sonal Verma, Kunal Sinha, Nitesh Pant, Shekhar Sahu, and Nilesh Padariya. The founders own about half of GlowRoad, with Verma and Sinha owning a bigger portion of the company.
GlowRoad claims to have over 10 million registered users and allows thousands of resellers to make money each month. It is collaborating with all major logistics service providers to address the delivery and return challenges, delivering products to over 23K postal codes, especially in Tier 2 and 3 cities. In 2020, GlowRoad raised $7 million from its previous investors – Accel Partners, Vertex Ventures, and IND Fund – in a new fundraising round. Following this round of funding, the social commerce business was valued at roughly $75 million. In 2019, GlowRoad, a social commerce firm, raised $11.5 million in a Series B+ investment round. In the same year, it raised $10 million in Series B funding from Accel Partners and CDH Investments.
This project could not have come at a better moment, as GlowRoad wants to expand into many Southeast Asian (SEA) countries, including Thailand, Cambodia, Malaysia, and Singapore. According to a Bain & Company estimate from 2021, social commerce accounts for over 44% of the $109 billion ecommerce sector in Southeast Asia. Meanwhile, this acquisition revealed Amazon’s interest in the social commerce space. GlowRoad came at a time when retailers were focusing on expanding their consumer base outside of Tier 1 cities, making Amazon’s entry into the game much more intriguing. Furthermore, social commerce platforms see fashion, home, kitchen, and other divisions produce a significant portion of overall sales through the reseller network.
The move could aid Amazon’s ambition of digitizing 10 million businesses in the country by 2025, with the majority of them located in rural communities. According to Amazon, it will also aid in the acceleration of entrepreneurship among millions of innovators, homemakers, students, and small business owners around the country. GlowRoad works with a variety of social commerce platforms, including Meesho, DealShare, CityMall, and Flipkart’s Shopsy. Flipkart announced its entry into social commerce in 2021 with Shopsy, an app that brings together a network of over 1 lakh Flipkart resellers. Customers who are budget conscious drive this market.
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