[music playing]
On Shark Tank India, to reassure Sharks
and to insure all of India,
the founder and CEO of Acko is here.
Varun Dua.
[water bubbling]
Nobody in my family does business.
Nobody has ventured into entrepreneurship.
My grandparents and my parents' generation
valued safety a lot.
To work and settle down.
My father was in a public sector company.
My mother was a school teacher.
So, she finally
retired as the Principal of a Maharashtra state board school.
My first job was at an insurance company.
Gradually, I realized this about myself that
if I can move an actual thing
or make a customer's life better,
or if I can improve the efficiency of my department
then I would enjoy it.
I was raised in Mumbai. I used to live in Juhu, Bandra.
Most of the working life.
Firstly, I started a company in Mumbai.
It used to make software for the insurance sector.
Then I started distribution with that company.
While doing that, I realized
that the model I've chosen
to solve the insurance sector or do something new, is not right.
I would not say that it failed. But it wasn't a success either.
And then I got the idea that I must manufacture my product.
That's how Acko happened.
It was in 2016.
The company started in Mumbai.
And I realized that if we must use technology,
and make it big,
then Mumbai may or may not be the right place.
But I had to make a choice. So, I chose Bengaluru.
Because the excitement and talent
in Bengaluru can't be found anywhere else in India.
A founder defines the culture of his company.
But if I talk about Acko's culture
then humility is one word.
I find this virtue or quality very important.
The bigger the team gets,
the more complicated the company gets.
There are many opinions.
Sometimes, those opinions are good.
Sometimes, those opinions also slow you down.
But when the team's heart is in the right place,
and they're thinking what's right for the customer.
This long-term thinking
and humility are bringing more people into this journey
and they're confident about working with the right people.
I think that's what defines Acko.
When Shark Tank was announced in India three years ago,
I was curious.
When season 1 got over, we realized
that we don't give India its due credit.
It has just completely made entrepreneurship mainstream.
The opinions on the Sharks,
what the founder said or what happened,
I have seen 11-12 year olds discuss it.
It's fascinating
that they're getting interested in entrepreneurship,
business, innovation.
Understanding investments and business.
When I watch a pitch, I connect it to my business and get ideas.
I want to feel that in flesh and blood. I want to see.
I've learnt a lot from the show.
So, I'm excited to see, in the hot seat, in the action.
And form relationships with those founders.
And hopefully have a long journey with them.
[music playing]
Hello, Sharks. I'm Purvi Roy.
Sharks, we've brought an upgrade in the luggage industry today.
And we've made smart luggage.
Like this Follow Me Suitcase, it follows you.
So, you can go handsfree at the airport.
Not just that, when you get tired of walking,
you can sit on it.
[laughing]
You won't carry the luggage.
The luggage will carry you hereafter.
No matter how responsible we become,
there's always the stress of losing one's wallet or mobile.
sold our smart products to more than 35,000 people.
Sharks, the vision of Arista Vault
is to solve people's worry of losing things
using our innovative products.
And to give people a hassle-free travel experience.
We're asking for Rs 45 lakhs
Purvi and Atul, welcome to Shark Tank India Season 3.
Thank you, Sir.
I had a fashion show, India Runway Week in 2017.
I met Atul and Colonel there.
Colonel is our technology officer.
So, we joined hands and decided
to build this company where
we can solve lost and theft hassles.
We conceived the idea of Arista Vault in 2017.
And we registered it in 2018.
I had topped my class 10 exams.
After that, I appeared for Railway Board exam and got selected.
At the age of 17 years and 10 months, I was working
as a ticket collector in railways.
- Oh! - Wow!
This is like Dhoni's story.
Since I found that job monotonous,
I wanted to do something better.
Finally, this year, I quit my job and took retirement.
I was one of the youngest to take VRS.
I don't get it. If she started at 17-18,
and you said that you recently joined.
You retired last year.
And you're saying that Colonel...
He was there from the start.
Is he fully involved or an advisor?
He was the co-founder but now he's a mentor.
So, he doesn't have equity in the cap table.
- He has equity. - He has equity.
- 2 per cent equity. - Okay.
- How much equity do you both have? - 60, 20.
What about the rest?
The remaining is with investors.
We have been supported by Ministry of Electronics and IT.
And a VC invested Rs 25 lakhs.
Main stage NGOs invested Rs 65 lakhs.
And in June-July, some angel investors
and the department of science and technology invested in it.
How much did they invest and at what valuation?
The first investment of Rs 25 lakhs was at Rs 11 crores valuation.
- Okay. - Rs 65 lakhs
was at Rs 12 crores valuation.
And now at Rs 20 crores valuation, we raised funds.
How much?
Rs 1.4 crores.
I can travel on it. Show it to me.
Here, you can
switch it on.
And your footrest will open.
That's your footrest.
Once the footrest opens, you can sit on it
It's the best way to cut through queues. Sit on it and
security line will automatically make way.
- Isn't it? - Yes, Sir.
- Oh, nice. - There's a USB for it.
Not bad.
And also there's a removable battery
which just needs a click...
- Oh! - Oh my!
- What to do with it? - If we carry this with us,
- You can take it to the cabin. - the staff will ask us to leave.
- No, you can take it to the cabin. - We take it to the cabin.
Do you want to try, Sir?
- Make way. - Let's race.
This button.
Not bad.
It's great. Takes weight.
[music playing]
- [bags collide] - Oh my, God! You guys!
[indistinct]
- But not bad. Try. - Try.
[music playing]
- Not bad, Radhika. - Not bad.
You are more focused on the tech aspect, right?
- Right now. - Yes.
Will you please explain your technology?
How is it exactly different?
Okay, I'd like to give a demo.
And I just double-tapped it.
And my wallet will ring.
As soon as they're 10 metres apart, both the alarms ring.
Your mobile and wallet.
And there's another interesting feature of map location.
And another interesting feature is selfie.
This wallet.
And when you press it,
Yes, using the phone.
- So, it's a selfie button. - Yes.
- It's a remote selfie button. - Remote selfie button.
Our second technology is fingerprint lock.
We have added it to bags. Third is Follow Me.
Smart luggage starts from Rs 1500.
It goes up to Rs 15,000.
and other facilities. It's for Rs 5500.
It is made with pure leather and has a good design.
Apart from this, this is fingerlock
backpack which is made out of pure leather.
This is for Rs. 9500.
If you look at that travel bag,
the shining one made out of sugarcane leather.
It starts from Rs. 3000.
And this one?
This one is for Rs. 50,000 now but
in future this will range from Rs. 15,000 to Rs. 30,000.
Rs. 50,000?
Yes.
That's too expensive.
This is loaded with features and has all the versions.
Ride on, follow me, it starts from Rs. 15,000.
the traditional market size and this.
Right now, luggage market is around ¤14 billion in India.
There are two stats. One is, Rs. 50,000 crores
and the other is ¤14 billion.
That's a huge difference.
And the market size of smart luggage
will become Rs. 1000 crores in India in the next 5 years.
Because of this, the upcoming technology is such that
- airlines are... - 25% people lose their luggage?
Sir, in a survey report,
- Your statistics are a little off. - Yes.
The total number that you mentioned...
Your numbers don't seem right.
Even ¤14 billion sounds wrong.
Even this 1 out of 4 sounds wrong.
Because losing 1 in 4 luggage is
a very big problem.
Luggage insurance industry
would have emerged.
I'm telling you because we do travel insurance.
If it was 1 in 4, we'd have been shut down.
You must've experienced losing your wallet or mobile phone
many times.
That doesn't mean you lose your wallet or phone every time.
These are two different things.
This is a 1 in 4 experience.
I want to know a little bit about your manufacturing.
Where are they manufactured and how?
Ma'am, it's manufactured in Kolkata.
Okay, tell me about your sales.
Our sales in 2020-21 were Rs. 75 lakhs.
In 2021-22, 1.57 crores.
And in 2022-23, our sales were Rs. 3.6 crores.
Very nice.
Till now, we've registered sales worth Rs. 4 crores.
Very nice.
And we have orders worth Rs. 5 crores.
This mainly sells on the website.
But you don't have any offline stores?
No.
What sales are you expecting this year?
We'll do around Rs. 9 crores.
Rs. 9 crores. And secondly,
the three categories that you have of
luggage, smart wallets and the bags.
Approximately, how much do each of these businesses contribute?
We haven't launched the smart luggage yet.
We haven't.
- were 90% from smart wallets. - Smart wallets.
This year, the smart bags that we've launched
have increased our average order value too.
And 30-40% of our sales from this
is from bags and 50% is from wallets.
What's the profit?
Tell us the unit economics.
As per unit economics, around 40% is our cost of goods sold.
60% is gross margin and 20-25% is spent on advertising.
Around 15% is spent on salaries and R&D.
The rest is our profit.
What's your profit? Tell us.
Last month, we made a profit of Rs. 12 lakhs.
On what sales?
Rs. 65 lakhs.
- About 20%. - Not bad.
will give you a profit of Rs. 2 crores?
Around Rs. 1.5 to 2 crores because
Before tax.
About 40% of it.
Sir, look at the industry.
There are many incumbents.
Forget technology for a second.
Technology can always be replicated.
There's no intellectual property here that can't be replicated.
So, in such a state, I don't believe
your business is worth Rs. 9 crores.
I'll consider it to be around Rs. 4.5 crores because
half is B2B.
Your own margins here are very less. And
you may want to scale up only in D2C.
Yes.
Then at this scale, how will you be able to compete with
incumbents and challengers who are even
more heavily funded and have distribution?
Firstly, our focus is to build a D2C brand.
We have even undertaken influencer marketing.
We've bartered and not paid them.
We have received millions of views.
We receive maximum sales from the southern
part of India. And in the non-Hindi belt,
this is becoming very viral.
I'd like to give Dubai's example,
we have signed an exclusive MOU there.
And they have committed to sales worth Rs. 10 crores in the first year
We're working on a similar tie-up in USA.
The biggest distributor of Apple in USA,
is in discussions with us to launch the brand there.
And as far as design is concerned, we're open.
We're maintaining our design aesthetic as a luxury.
To create the aspiration need.
Your bags are good, not the luggage.
Your fonts are different everywhere.
It's different everywhere. You haven't thought of branding.
Anyway, there are many things that you have to prove.
Because the competitor doesn't have your advantage as of now.
Because he finds the market to be small.
But as soon as you grow, your competitors will jump in.
You'll have to move fast, that's my suggestion.
Strengthen your technology as soon as you can.
And grow your brand so that
you can compete with them in terms of technology and branding.
I'm out for now and I wish you good luck.
Purvi, Atul, I'm out of this today.
There are two reasons. First, I think that
there are so many features in this
I found it very confusing. Maybe that's why it's being gifted more.
Not self-consumption.
Secondly,
investing in a business which is mainly tech,
without the tech co-founder,
is a little difficult today, hence I'm out.
I think that the tech part of this business. The luggage
as a category
may have 2-3 important features
in the long term. Or maybe 4-5.
And all the big luggage companies
will create those important features.
And they'll have distribution and trust.
They already have the design.
So, competing with them might be difficult for you.
That's why I'd like to be out.
I have two issues.
One is, I find this business a bit early.
My suggestion is that you should focus
on what is your value proposition. This or that.
Or is it the smart wallet. I think that
if you focus on one thing and get scale in one thing,
then think ahead.
Secondly, I asked you about manufacturing.
I'm not sure about your competitive advantage.
You don't manufacture it yourself.
I didn't find your design to be very distinctive.
When I see your bags, the fingerprint technology
looks very basic.
- I'll be out for now. - Look...
It's a solution looking for a problem.
I don't think that people will complicate their lives so much
for luggage or for travel.
Technology works best when it's seamless.
If I have to remember so many things like
removing the batteries and charging it,
it's too much over my head.
I don't think that just tech
will revolutionize the luggage industry.
You'll have to be great at tech and design,
and branding.
But the flip side,
you have doubled every year
and set up a business worth Rs. 9 crores.
Yes, Sir.
You're making a profit of Rs. 1.5-2 crores
this year itself. This isn't an ordinary thing, I think that's big.
Everything in me is telling me not to make this offer.
But your numbers are so good.
So, I think there's a bet.
Rs. 30 lakhs debt at 18% interest for 2 years.
And Rs. 15 lakhs
I'll give you
for 1% equity.
So, Anupam, we have a counter-offer.
Rs. 20 lakhs for 1% equity.
And Rs. 25 lakhs in debt.
That we can take. 18% for 2 years.
You have a Dubai deal, isn't it?
Conditional upon that being confirmed.
You said Rs. 10 crores sales in that. Remember that.
- The deal is confirmed. - All right.
Our ask is Rs. 55 lakhs for 1% equity.
In the era of UPI, you buy a chocolate worth Rs. 2
through your preferred UPI application.
Shopkeepers have multiple QR codes
and card machines to facilitate transactions.
A significant number of transactions are still done in cash,
and they continue to offer credit to customers.
Sharks, the problem lies in the fact that these shopkeepers
lack a convenient method
to record these transactions.
Although there are several apps available
to assist with recording transactions,
the issue is that their mobile phones aren't always on the counter.
It's often kept in their pockets, stored elsewhere, or being charged.
They have to pull out their phone,
unlock it, open the app
and manually input transaction details.
We observed something interesting. Shopkeepers often
resort to using normal calculators.
Such calculators are found in every shop.
We came up with a concept
where shopkeepers can use a calculato
to document their transactions as either sales or expenses.
So, Sharks, introducing
the world's first smart calculator, Tohands Calculator.
cash-in and cash-out, through which
the shopkeeper can track
and simple solution for the shopkeepers.
in efficiently managing their finances.
So, Sharks! Let's calculate the deal.
Oh! Nice!
- Welcome to Shark Tank! - Thank you, Varun.
- Your pitch is quite interesting. - Thank you.
First, I'd like each of you to share a bit about your background.
Sharks, I am from Pratapgarh district in UP.
After dropping out of college,
I made first app. ByBuy seller app.
It was during that process that I came up with Tohands smart Calculator
Now, we are making smart calculators.
I come from Tamil Nadu.
in Erode.
I am into hardware.
I am Satyam, I am from Kanpur.
How old are the three of you?
- I am 22 right now. - 22? - Yes.
- Wow! - I am 26. - And I am 31.
- Who is the CEO? - I am.
- You are 22 years old. - Yes.
- And they are 26 and 31. - Yes.
- Do they listen to you? - Yes, they do.
Show us your product.
[theme music playing]
I can't turn this on.
- Press the power button. - What?
Press the button.
It's not powering up, even though I'm pressing it.
- It will take time. - Press the button properly.
- It's slow! - Not the best initial response.
It powered up.
Version 3 is a prototype version.
- Is this version 3? - It is version 3.
The hardware is going through various iterations.
The key thing to note is that version 3
is not a finalized version.
It is currently available in the market as a prototype.
I'd like to demonstrate something, Aman. Let's say,
You purchased a packet of bread for Rs. 45,
milk for Rs. 23,
and lentils for Rs. 80.
- Okay. - The total amount comes to 148.
Mr. Mishra has to click on the 'Cash-in' button to record the sale.
Now, since you made an online payment,
Mr. Mishra needs to click
the 'Cash-in' button twice to change the payment type to 'online'.
Once he hits 'Enter', the transaction will be saved
and synced with our Tohands app.
You can see the amount of Rs. 148 here.
Aman doesn't pay with cash, he prefers credit.
- So, show that. - We have a solution for it.
Let's assume, you bought a packet of bread for Rs. 45,
and lentils for Rs. 89 on credit.
The merchant needs to select the 'Cash-in' button,
- switch the payment method to 'credit', and press 'enter'. - Okay.
The credit has been recorded now.
Now, let's say a vendor
came to Mr. Mishra's shop and Mr. Mishra
purchased the items worth Rs. 10,000.
Mr. Mishra will click 'Cash Out' after calculating
the final amount and then press the 'Next Extra' button.
- You will need to enter the user's mobile number. - Okay.
Will the system recognize this mobile number
if it is on your list?
Each user has a customer ID, which will be recognized automatically.
You don't need to enter the number again, just enter the ID.
Basically, you are saying
- that you are creating a ledger using a calculator on the go. -Yes.
- On the go. - Is that right? - Correct.
- Did you do an on-ground check with the retailers? - Yes.
Are they using it as a regular calculator,
or have they started keeping track of their accounts?
Did you see the adoption?
Yes, we have.
Our product went viral on Instagram.
It garnered over 30 million views and
was shared more than 1 million times.
What do you mean by 'it went viral'?
Considering that this product
- addresses a crucial need for shopkeepers. - It does.
They will likely share it with other shopkeepers, don't you think?
Getting a POS with a calculator
When you made this,
and showed it to a shopkeeper,
what was their feedback?
Currently, we document
over 80,000 transactions on a monthly basis.
How many shopkeepers contribute to this figure?
Around 1000.
Where are your 1000 shopkeepers
based and what type of retailers are they?
There are grocery stores, hardware stores, electronics stores,
clothing stores,
small clinics,
and small manufacturing businesses that monitor their
sales and expenses.
Where are they based? In Tier 1 cities or Tier 2 cities?
Majority is in Tier 1 cities for now.
It is not something complex to build into an ordinary calculator.
You just have to add a couple of buttons.
This is not a very complicated thing
that an existing calculator company cannot do.
Why haven't they done it?
They have always looked at it like a tool used to calculate.
We view it as a tool
for those who are unable to invest in a billing machine,
offering them a simplified alternative.
You are right.
You must ensure that the phone remains powered on
and activate the app. There is a lot of friction.
There is no better way than this.
However, in Western countries,
utilizing POS
resolves all the problems in one place.
Have you introduced a transitional technology?
As India is moving towards POS.
Our point of view is that
we had normal watches.
Now, we buy smart watches.
POS machines are expensive.
They are also complex.
You have to hire someone
and train them to manage inventories.
Majority of shops have 'galla' out in the open.
They lack inventory for all the items. They don't have SKU data.
Hence, it becomes challenging to implement POS in India.
We are of the opinion that until the adoption of POS reaches a point
where more than 50% of the shopkeepers
start using it,
this product will continue to be in demand.
Hurry up and tell us your sales.
Our total revenue is Rs. 29 lakhs.
We started selling in January, From January until now.
How much is this product made for?
Rs. 2,200 is the cost of goods sold.
There is a subscription on our app.
July, and the previous month?
Our sales in January were Rs. 1.5 lakhs.
In July, our sales were Rs. 13 lakhs.
We have a waiting list of 5,600 customers.
Through which, we are selling to the customers.
Didn't you raise funds for inventory?
Are you bootstrapped?
No, we raised funds.
Pre-seed round of Rs. 55 lakhs from T-Hub and other investors.
We raised it
- last year. - How much has it been diluted?
- It's a CCD investment. - How much is the cap?
There is no cap. It was on post-money valuation.
- How much? - 20% discount.
- Has it been converted? - Yes, it has been.
So, did you raise another round?
- How much is it? Tell me in detail. - We raised a seed round
for Rs. 3 crores.
At a valuation of Rs. 29 crores.
We are building up the production capacity.
For version 4, 40% will be put towards inventory.
Remaining 60% will be used for research and development and growth.
Is Rs. 55 lakhs enough for you?
We are headed towards larger scale manufacturing.
We are also looking at the option of inventory finance.
The problem we faced with version 3
was that our supply chain was unstable.
- Our vendor... - From where do you get it made?
- For now, we assemble it in our office. - Oh!
- That is nice. - Very impressive I think.
Good job!
What's your ownership structure?
So currently, I own 34 per cent.
I own 23 per cent.
I own 13 per cent.
That accounts for 70 per cent.
Yes, it accounts for 70 per cent.
ESOPs is 8 per cent.
- 70 per cent between you three. - 8 per cent ESOPs.
- 8 per cent. - I have 37 per cent.
Yes, okay. Sorry.
To make this, it costs you Rs 2200.
The cost is so high.
Yes, in version 4, you have colour LCD display.
Okay.
We will require Rs 3500 initially.
- As a lot... - Large scale, the cost will reduce.
You will be left with Rs 1500. What are your other costs?
No, other costs are not high.
Do you charge for subscription?
Yes. The shopkeepers
receive a free sample for use from us.
They can use it as much as they want.
- Per month? - How many people are subscribing?
We will include subscription from Version 4.
So, we received a lot of feedback about Version 3. So, in Version 4,
for example,
and they can pay for that exact amount.
Interesting. You worked at the grassroots level.
You understand the agony of shopkeepers.
But I feel that
in the front end,
there are 2-3 things required for billing automation.
There's cash register,
which records the money debited and credited.
- Right? - Yes.
Secondly, at the complexity level, POS.
You're saying that you will venture below that.
Yes.
Because in India
you require this level of simplicity and you will tread up slowly
because you're ultimately headed there.
- Yes. - The way you said it.
So, you're saying that
forget the POS and cash register in the market.
Buy my product and I'll take you on that journey.
It doesn't fit somehow.
What's the price of cash register?
Between Rs 15 and 30.
Cash register. And POS?
More than Rs 40,000.
Do you have to pay that money or do you get it for free
so that you can bill through them?
No, we have to pay.
- You have to pay. - We have to set up a system.
And I'd like to answer something.
- Yes. - The billing machines at present
have no online feature.
If you make a sale through that cash register,
at the end of the day, you get a roll.
- Correct. - You receive input.
If you want to check last month's sale,
you have to pull out last month's roll.
You will mostly see Trucount's cash register,
and all their transactions are recorded offline.
You have to print it out and store it.
But basically, the business of cash registers.
Yeah.
If their business can function,
in spite of there being a POS. So can yours.
We believe that
our product is affordable.
Shopkeeper buys a phone worth Rs 10,000-15,000.
They want to be smart.
The first step is to use smart calculator,
try the device and slowly they will adopt the technology.
There is a bit of a use case.
- There is a bit of a use case. - Yeah.
Yes, but as far as I know
use case is primarily for cash ledger.
Not as a POS system.
No, calculating is fine. But to pull out GST records.
- No. - That's not possible.
So, only how much cash is in the drawer.
- The ledger. - Yes, that's what he's saying.
How much money is in the drawer.
- Money. - It's a physical ledger book.
Our value proposition for shopkeepers is pretty simple.
It helps keep account of every penny.
- We got it. - Who gave, how much,
and what was the payment type?
Nobody else has made this.
Not yet.
Good. Not bad.
I think it's got a use case.
But, Praveen, at the age of 22,
your depth of work is very impressive.
Very commendable.
The way you explained the problems of shopkeepers.
You spend a lot of time in the market.
I've been working on this problem for the last 6 years.
- 6 years? - Yes.
Earlier, he had a company in this domain.
Earlier, we used to make ByBuy Seller app
where shopkeepers could create their shops online
and could sell in nearby areas.
We had 7000 shopkeepers. My job was to bring them on board.
I noticed that there's an aunty in a store in Bangalore.
She used to calculate the amount, write it on the paper,
and then use a calculator again
to calculate the numbers on the paper to find the final amount.
To calculate the sales for the day.
I got an idea that what if we can record it?
How did you decide to make a team?
I've always felt that it's all about a team. I'm not doing it alone.
My team does everything.
He's making the hardware, he's making the software,
I'm just marketing it.
I have a team of 22 people. They work really hard.
My work is not much.
- Your sales-- - It's the same with me.
How do you do sales, Praveen?
Our sales are online at present.
Multiple times,
our product went viral.
Indian Express wrote about it.
We made the highest initial sale after that.
After that, a YouTuber made a video and we had great sales.
Then after that
whenever we do sales, we meet the customer.
I used to handle the customer support until July.
- Okay. - All the customers know me.
I used to get direct feedback from them.
Amazing. What else will you do?
What next after calculator? Or is the end of it?
In the next 2-3 years, we will
deploy 1 million units in the market.
- Okay. - Yeah.
- Oh. - Oh!
I'd like to do Rs 30 lakhs as equity.
And Rs 25 lakhs as debt at 12 per cent.
- For? - For 1 per cent. Same.
- For how many years? - 2 years.
- It's a good offer. - It's a good offer.
Tell me what's your biggest
differentiator or variable for long-term sustainability?
A good quality hardware.
And solid distribution.
- Look, Praveen. - No.
Conceptual questions are never-ending.
What do you want to do?
[music playing]
Okay, I can also make an offer.
- Oh! Another offer! - Another offer.
So, I'll make the same offer as Varun.
Actually, I think combined between both of us.
Yes.
- We both belong to this domain. - Absolutely.
Partnerships will require more effort.
- Because that relationship is long-term. - Okay!
- In banks and financial... - Banks and financial services.
I am out.
You said you needed help with partnerships.
If you needed help with brand and sales,
I would've thought it made sense
to get involved in this wrestling match.
- Really? - So, enjoy the wrestling match.
You are amazing.
Great entrepreneurial spirit.
I believe
that until the release of version 4,
we won't have proof of where this company is headed.
It seems like you will make it work.
Moreover, you have attractive offers
and he has increased the valuation for you.
I can't offer such a high valuation.
Unfortunately, even I am out.
Thank you so much.
- Do you need debt? - Debt? No!
Take Rs. 55 lakhs
for 1.50% and end it.
Keeping that in mind, we've come up with this offer.
You've already diluted 20% of the equity.
The reason I was giving debt is because I don't want to
dilute too much equity. Currently, we only have proof of concept.
- But debt is too early in the process. - I agree.
- Right! - I would like to delay it.
Let's give you better terms.
- Instead of 12%, make it 10%. - Yes, I am okay with it.
- Don't you want to take debt whatsoever? - Not yet.
Listen! Rs. 60 lakhs for 2%.
And there is Varun Dua
and Radhika ma'am's offer of Rs. 60 lakhs for 2%.
[suspenseful music playing]
I have a counteroffer for Mr. Varun,
Ms. Radhika and Mr. Anupam.
Rs. 80 lakhs for 2% equity.
Currently, your fair valuation...
- Around Rs. 20 crores. - With thousand... Not even that much.
The maximum valuation should be Rs. 10-15 crores.
I increased the valuation because there was intensity here.
But I think it is unfair
to give that kind of valuation
at this point.
So, I will be out. They can bring down the valuation.
Because that is the right valuation.
I won't offer a higher bid.
If there was no previous round,
I wouldn't have valued it at more than Rs. 15 crores.
- Because effectively, this is a pre-revenue company. - I agree.
It might get difficult to raise money in the future.
You have one offer. Rs. 60 lakhs for 2%
from Varun and Radhika. So, tell us.
Radhika and Varun, we have a deal.
[camera clicks]
We got a deal!
- The founder is amazing! - Good founder
- but expensive. - This is the young person you want to give capital to.
Rooted! He knows his business. Solving an Indian problem.
He will do whatever it takes. He will pivot, but figure things out.
- He will do something sensible. - He will make something.
He will!
Sharks, we found out about a brilliant scheme.
You can double your money in 21 days.
- Hold on! - Huh?
This is a scam and not a scheme.
Sharks!
You must have heard about such schemes in movies or the market.
But there is one place where your money is safe
- and that is gold. - Hmm!
And that's why Indians have been investing in gold for many years.
Indian women have around 25,000 tonnes of gold.
worth of gold and gold jewellery is purchased.
advance purchase plans or gold jewellery savings plans.
In 10+1 schemes.
Shivani visits the jeweller on a monthly basis
to deposit money.
And the jeweller gives her the 11th month's instalment
as a discount
so that she can buy jewellery from him.
But Sharks, the drawback of such schemes is the lack of flexibility.
As customers can't withdraw funds or switch to a different jeweller.
You have to decide on a jeweller today
to buy jewellery after one year.
Shivani was facing a similar problem.
Therefore, we made our app Plus.
Plus is an easy-to-use gold and jewellery savings app.
And they have saved around Rs. 45 lakhs on our app.
Our vision is to channelise
a sizeable amount of the jewellery sa market
through our app in the next five years.
In order to accomplish this vision,
we need your support
and Rs. 60 lakhs for 1% equity in our company.
First is monthly savings,
which is similar to how you invest with the jeweller.
The best part is that if you miss an instalment
you are not charged a penalty.
their savings in the digital passbook,
But it doesn't make sense frankly.
- Okay. - It's a savings app.
If I was Aman, I could just put this money
This market is unorganized.
The audience that participates in this market
is not investing in mutual funds now.
- Is it because it's a cash market? - They...
No, Ma'am. It's an awareness or education issue.
is attached to local, neighbourhood,
or trusted family jewellers.
They deposit every month
and the scheme is so made up
that making charges get discounted.
- And other things. - Correct.
And you can lock the gold price.
- Yes. - That's the most important thing.
It's not happening here. It's just savings.
So, both sides, it works.
So we have focused it on jewellery because
this market is desperate for innovation at present.
No, it's a generic statement. What innovation?
This has nothing to do with jewellery.
You applied a jewellery use case, that's different.
The jeweller is actually using this as cost of acquisition.
Pushing the discount back to the
customer as perceived value.
And the existing behaviour in India regarding gold jewellery purchase,
that entire perceived value is being packaged here.
That's my understanding.
Explain the customer's math
and jeweller's math separately
in a simple manner once.
When a user saves on our app,
let's say they have saved Rs 1 lakh for once.
- The math will be easy. - Okay.
- On the app, the return is Rs 10,000 - Correct.
from our jeweller partners anytime.
So overall, you're saying that a jeweller's
cost of customer acquisition is 10 per cent.
- That's what you're roughly saying. - Yes.
That 10 per cent, as an affiliate,
you are receiving that 10 per cent.
- We give it to the user. - You're giving it to the user.
So, how will you make money?
We have a take rate from this investment.
You're collecting money from people, saving it,
how are you regulated?
How do you pool it?
The money never hits our bank.
- It goes directly to NBFC. - Directly to NBFC.
It happens after Aadhaar and PAN KYC is done.
So, you're their distributor,
- digital distributor. - Yes.
What is the underlying risk of this NBFC
- that you're giving money to? - Lendbox, that is an NBFC.
They have a product named Per Annum.
We have integrated it.
In this, they just
lend 2 per cent to public with a credit score of 750 or more.
Those are high-risk businesses.
The NPA of this platform is 0.4 per cent.
- It's 0.4 per cent right now. - Yes.
It's risky if you lend at 12 per cent.
Yeah.
It looks like the bet that's asking for investment
as it can invest better than the others.
Everyone thinks that.
Tell me something.
What is the risk-free rate?
I think somewhere between 6.75 and 7.
There is no such thing in the world called risk-free.
Every percentage point that increases after 6 per cent
indicates a bigger risk.
So, you can never claim
that at 12 per cent
it's kind of risk for you.
Actually, you have to first stop lying to yourself.
- It's not true. - Sure.
Alright.
A 6-year-old NBFC
that hasn't seen many cycles, anything can happen.
12 per cent is a very dangerous game.
So, what is the other option?
Let's say, you aren't able to give 10 per cent to the user.
What will you do?
There seems to be an advent risk for the user.
The NBFC brings in that risk.
It's transparent.
They will make 6 per cent with FDs.
They will be able to see it here.
And the user will be able to decide for self.
Our FD partnership is already done.
- With whom? - Bajaj Finserv.
But the marketing of the jeweller's discount,
which is your real use case, it works.
So it's over and above that.
So, reduce this to 4 per cent.
Add the jeweller's part and project it.
Because that's your real use case and you're hiding it.
Vineeta, we are moving towards it.
- Why haven't you done it yet? - Because...
- We... - It's the industry hygiene.
These partnerships are time-taking.
So you don't have one yet.
No, we recently closed a partnership.
- Just one, not others. - Yes. Recently,
- we closed it. - So you haven't been able to do it.
What's the status of your sales?
As I mentioned, we went live three months ago, right?
In the first month, we registered savings of Rs 5 lakhs on the app.
In the second month, the savings increased to Rs 10 lakhs.
During Diwali, festive season,
our savings increased. The total savings on app was Rs 32 lakhs.
- Okay. - It's Rs 45 lakhs already.
We raised two rounds.
The first round was during the ideation stage.
VCats, WFC,
JITO group. There were a few individuals too.
We raised Rs 2.59 crores.
At Rs 20 crores pre-money valuation.
Okay.
After that, we launched our recent MVP.
Before we launched it, we opened our last round
in which we've recently closed SHA at Rs 4 crores.
At what valuation?
This is Rs 40 crores, post money.
What's the revenue?
Calculate. It's around Rs 50,000.
- Yes, more or less. - Rs 50,000.
- You can call it pre-revenue. - 1% approximately.
- Pre-revenue. - Yes.
In the last 5 years, brands that have emerged
are scaling very fast, right?
But your business
is not into jewellery.
You're a savings or wealth management platform, plus
lead generation for jewellery.
But it's very complex.
- The revenue and business model are still not clear. - Okay.
So, for that reason, I'm out.
I think your lack of judgement
to put this money into an NBFC
that works on 12 per cent interest.
I think that's questionable.
Because
taking such a risk is something I wouldn't want
someone I'm trusting my money with to take.
Okay? So, I'm out. But best of luck.
Fundamentally, I don't find your use case to be strong.
You want to enable savings.
Very big, regulated platforms
like mutual funds are doing it very well.
And there is less awareness.
But it's on the rise.
Also, I think your understanding of regulatory and risk is weak.
Not only because of this NBFC
but even if you want to give other options in the future,
I find it to be a grey area for regulations.
So, I'm out.
Have you heard of MSS?
No.
MSS is Mummy Savings Scheme.
When there's no money anywhere, mom lends money.
Moms have a psychology to save money.
Something that is not risky.
She'll never come here
because this is already so risky.
And why does she even visit her local jeweller?
Because she trusts him.
She'll never come to you.
I don't know how you're going to make this product-market fit.
How will you turn it around, what complications, I don't know.
Unfortunately, I'm out of this.
If the making charges part doesn't work,
and if this IRR that you're offering of 10%
dips down to 4-6%,
then will that business work? What's your honest opinion?
Yes, it will.
How?
Interest of 4-5% interest from risk-free savings
and a discount of 8-9%
comes from the jeweller.
It's available with us today.
- Okay. - We started with P2P because...
the flexibility we wanted, we found there.
- And it's not that... - What flexibility did you want?
We wanted flexibility of withdrawal.
So that the user can withdraw his money whenever he wants.
And we wanted quick integration
and validate in the market whether our users
are able to trust us and save on this app.
I have a discount for 320 jewellers
- already decided. - What's the deal with the jeweller?
There's a separate deal with every jeweller.
What's the average deal?
Rs. 60 lakhs at Rs. 40 crore valuation at 1.5%.
That's the offer.
Thanks a lot. You won't regret it.
[music playing]
I liked the founders.
That space is getting created.
If you can tie up with enough jewellers
and start getting good discounts from them.
It becomes a treasury management business. It's a float business.
Yes.