Infibeam: The Unicorn and its promise to deliver Infinite smiles

• ByStartupStory     |    December 17, 2021

 

“To build a company is very hard, and to help others build their company is even harder”- Vishal Mehta

 

Of  the few e-commerce companies based in India, I am going to take a guess and say that we are fairly familiar with Flipkart, Snapdeal and the likes of such. However, let me indulge you and introduce to you a company that almost bought out Sachin Bansal and Binny Bansal’s Flipkart in 2008. Infibeam, the company that was co-founded in 2007 by Vishal Mehta and Vishwas Patel. It is among the few internet e-commerce companies to be listed in the stock exchange and turn a profit. Quite recently, in May of 2021 they entered into an agreement with Mukesh Ambani’s Jio platform to provide its Infibeam Avenue space and services for JioMart’s operations.

The Business Model

Initially started as a B2C(Business to customer) startup, Vishal Mehta’s Infibeam transformed itself into a niche B2B market model and that is probably the reason why most market laypeople are unaware about the existence of the company whereas it is exceedingly popular among merchants.

So what is the business strategy?

Initially, operating as a multi-category online marketplace at the destination “Infibeam.com”, the company added a B2B platform in 2012, under the brand name, BuildaBazaar. BuildaBazaar is an end-to-end SaaS (software as a service) solution that allows merchants to set up an online store, manage the backend (orders, inventory, logistics) and manage marketing. To put it in Mr. Mehta’s own words, “Our vision was that, as we build out, let’s not build out a retail company which will eliminate all the small-shopkeeper-walas”. This has garnered about 100000 merchants on the BuildaBazaar platform. 

Later in 2018 Infibeam will go on to merge with digital payment player CC Avenues and operate under the brand name, Infibeam Avenues Limited. It now provides digital gateway payment services to over 400,000 e-merchants among brands such as Amul, Adani Wilmar, Nilkamal @Home, Saudi Telecom, Jumbo Electronics, Spykar, Panasonic, Blackberry, EsselWorld, Idea Cellular, Emaar, Government of India, Taj Hotels, Oberoi Hotels, ITC Hotels, Hilton, MakeMyTrip, ClearTrip, Shopclues, Myntra, McDonalds, Starbucks, Airtel, DishTV, Go Daddy, BookMyShow, Vistara, Indigo, Vivo, GAIL gas and many more.

More than 98% of Infibeam’s revenues comes from its two Web Services, BuildaBazaar, Unicommerce(Supply Chain Solutions),  CC Avenue, Bill Avenue(Interoperable bill payment solution built on BBPS infrastructure) and Res Avenue(Payment solution for hospitality industry). Merely 2% of its revenue stems from Infibeam.com.

Infibeam’s growth since IPO 

Infibeam Avenues Limited went public in April 2016 with a topline of Rs 337 crore and a profit of Rs 8.8 crores. Up until then, the company procured a loss of Rs 26 crore and Rs 10 crore in 2014 and 2015 respectively. But since its listing, the loss making trend reversed on the company. In FY17 and FY18, its profits grew manyfold, with Rs 43.5 crore and Rs 88 crore in 2017 and 2018 respectively, nearly a jump of 90% and 120% in both revenue and profits. The latest records indicate a net profit of Rs 18.58 crore for the quarter ending September 2021, which is a  53% rise from the year-ago period.

Indian partnerships and International expansion

The two years following its listing, Infibeam showcased very productive activity and managed to grab some high-end contracts for itself. Since its listing, it secured a project to make tourism department websites along with an e-commerce project for Amul, India’s biggest dairy cooperative. Not just that, Infibeam was also entrusted with the trust to build a government e-marketplace, known as GeM on its web service platform BuildaBazaar and “build a bazaar” they did. The agreement with Reliance in May 2021 to manage the marketplace of JioMart is a new high for the company as it further advances its clout in the digital market.

The first Indian listed e-commerce company also made its headway into the international market by acquiring an online digital payment processing company, Vavian International Ltd. in the Middle-East for a sum of AED 4.32 million ($1.2 million). “With addition of payment gateway services in Middle East, we will be able to increase the payments transaction volume revenue and acquire additional merchants in the Middle East region,” said Mr. Mehta.

What do the Future aspirations look like?

“Lending is not a science, it’s an art” , says Infibeam President of Corporate Finance, R Srikanth.Under the secured lending framework, Infibeam has provided express settlement for their merchants which they want to take it to $200 million. With the benefit of access to a  huge consumer base, the partnership with Reliance is a huge boon for the company as they plan to achieve the goal of a $100 billion transaction over the next three to five years. In simple terms, Infibeam is looking to bank on its payment services as the primary source of its revenue.

From providing an online space for merchants to managing the payment gateway services, Infibeam has pulled off an improvisation success over a decade. However, over all these transitions, Infibeam has however remained true to its initial ambition of not eliminating the small and medium merchants rather helping them expand their market.

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