Episode 55 / March 8, 2020

Vidit Aatrey, Founder & CEO, Meesho

hr min

Episode 55 / March 8, 2020

Vidit Aatrey, Founder & CEO, Meesho

hr min
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About the Episode




After completing his B.Tech. from IIT Delhi, Vidit worked with ITC & InMobi during his early career.

It was around 2015 when he decided to try out something and while exploring other options he came across this idea to create a platform (Meesho) where people could start & manage their business from the comfort of their home.

In this podcast, Vidit shares his experiences of building Meesho & understanding the core needs of their customers.

Watch all other episodes on The Neon Podcast – Neon

Or view it on our YouTube Channel at The Neon Show – YouTube

Notes –
00:40 – His career background and bringing an un-organized business online
04:30 – Building 1st version of Meesho
11:10 – Aggregating distributors on the platform
12:50 – Making investors understand the new business model
15:55 – What helped him keep growing while building a new business model?
17:40 – Tackling the growth slowdown 6 months after raising capital from SAIF Partners
26:25 – Listen or Die (Talking to users every 30 days)
27:43 – Meesho’s revenue model
29:30 – Current User Persona
32:38 – Culture & DNA of Employees at Meesho
35:55 – Change in Go to market strategy
41:45 – Hiring strategy for Key Leadership roles
48:50 – Irrespective of your growth don’t compromise with Culture Fit

Read the full transript here-

Siddhartha Ahluwalia 0:00

Hi, this is Siddhartha Ahluwalia, welcome to the 100x Entrepreneur podcast. This episode is brought to you by Prime Venture Partners, an early-stage VC fund led by Amit Somani, Shripati Acharya, and Sanjay Swami. Prime is often the first institutional investor in category-creating tech startups in FinTech, SaaS, healthcare, and education such as Ezetap, MyGate, and mfine. To know more about Prime visit Today I’m with Vidit Aatrey, Founder & CEO of Meesho. Meesho has pulled a social commerce revolution in the country. I think that the term social commerce even got coined after Meesho came to be known in every nook and corner of India. Welcome, Vidit, to the podcast.

Vidit Aatrey 0:21

Thank you so much for inviting me here, Siddhartha, I’m honored to be here.

Siddhartha Ahluwalia 0:26

Tell us about your own journey as an entrepreneur when the thought of being an entrepreneur occurred to you. And I remember because we knew each other from the last five-six years, it worked, after quite a few pivots that you built Meesho.

Vidit Aatrey 0:40

Yeah, of course, I’m always up for sharing a story because it’s so unique in so many ways and so similar to a lot of other entrepreneurs out there. So just to give some brief background, I graduated from IIT Delhi, in electrical engineering and so is my co-founder but we took a different journey after that. I worked with ITC for a couple of years. Then with InMobi for a year, and that’s when I realized that this is the right time to be a tech entrepreneur like if you’re doing anything else in India, you’re not living up to your potential. And after that, I got in touch with Sanjeev who was in Tokyo working with Sony. He told me one day that he’s looking to come back. I thought this is my opportunity to start up, but we had no idea. This is the middle of 2015. And we started thinking about what we can do, what problems can be solved. And we realized that most small businesses in India are still offline. Most of the unstructured longtail commerce still happens offline, whereas a lot of organized and branded commerce had moved online with Flipkart and Amazon. So we said there is definitely a large opportunity of organizing a lot of this unstructured commerce but we did not know what to do. And we first started with a model which was called Fashnear. Fashnear essentially, a Swiggy for fashion kind of a model and the Genesis was a lot of fashion shops, small fashion shops used to have customers very close to them offline. We said, If we open up a lot of this supplier to an app, and people can transact with shops around them, a lot of them would want to do it. Tried this for about three, four months very quickly realized that people do not buy fashion the same way they buy food. People are looking for a lot of selection, which is not available with a few shops around you. When people in India buying online, especially fashion, they’re looking for discounts that are not available until the end of the season. So some of these learnings as a first-time entrepreneur came to us and we were quite flexible because we knew that we are not experts in this field. But the good thing was that when we were trying to build Fashionyear for three, four months, we spent a good amount of time on the supply side with these small mom-and-pop stores. We used to stay in the shops from morning to evening, play with kids of the shopkeepers, talk to them about the life stories and during this time, we understood a lot about how these guys are running their businesses. And one thing which was very common across all of these guys was they were using social channels, and mostly WhatsApp to reconnect with their existing customer base. So what was happening is if I go into a shop and buy a product, this shopkeeper after the purchase will take my number and add me to their WhatsApp group. And then every time they get new stuff in the shop, they will take pictures and put it on the WhatsApp group and people who like these products will then just say, Hey, I like this can I buy and this person will send a Chotu from the shop to the house, collect money, give the product and then the sale has happened without a customer walking into the store at all. And this shopkeeper told me that now about 30-40% of my total sales are happening on WhatsApp and I’m super happy. My brother who’s in Whitefield is doing even 60-70% and that was the first time we realized that this is a behavior that is happening more and more among mom-and-pop stores and most people don’t know about it. So we said if we enable this behavior, maybe there’s a large opportunity, right? And then we build the first version of Meesho. Meesho comes from Meri shop because we wanted to give this person a shop like experience online and make it very easy for this person to sell at least to the existing customer on Whatsapp, Facebook, Instagram. So we built this app, which was a mobile-first Shopify like a product, come click in one step, you get your account. We retrieve everything that you have on your Facebook page onto your store for just a single click, and then you can use this store to sell on WhatsApp and the problems that we were solving were collecting payments which is hard. Earlier this person will get new stuff into the store every two months, but he will have to put something new every day on that group. He will keep pushing the same photographs, a lot of people will feel spammed, so now he can just share a link managing order used to be on notebooks very cumbersome. And then we again through this product solve for it. So we thought that, hey, we have solved a lot of these problems for these guys. And they will start using it. It started to pick up, finally, we saw a product that people are using. Our growth month on month was pretty good. We raised an angel round, went to YC, six months forward, we realized that the product wasn’t turning out to be what we wanted it to be one because we did not know how to make revenue from this. It was a free tool. Second, the retention wasn’t that great. But we realized among our user base, a good 30 40% of our user base was not what our target user was. This user was not an offline mom and pop store shop. This user was essentially a lady who’s running a home-based business, right. And when we speak to them, we realized that she’s calling the store her WhatsApp boutique. And when we dive deep into this, we realized a very, very peculiar behavior, right? Something that I did not know that a lot of women in India after marriage don’t work. And sometimes it’s voluntary. Sometimes it’s not voluntary. And in these cases, these women start some home-based businesses, because it gives them two things. One is it gives them a professional identity. And the other, it gives them some financial independence, so they don’t have to go to their husband to ask for money all the time. But to start a home-based business, such as a boutique or a jewelry store, you need some money for working capital. So you can go to a wholesale market, buy products and come back. And most of these women will not get this money from their husbands or family or someone else. And lack of this support will hurt a lot of these dreams that so many women have. But back in 2015-16 so many of these women realize that they don’t need money anymore because people are now buying products through photographs and if they don’t have inventory, they ask suppliers to send all the photographs they have, they can curate a basic understanding of the user and sell to people on WhatsApp. And as soon as this started to happen, they realized that now they’re doing a lot of sales because people all around the community are buying from them. A lot of their friends who are not even the vicinity could be in different cities buying from them. And they have zero risks because they’re not buying any inventory. So people had figured out a way to run boutique on WhatsApp. And they were using our app because we were the only tool to manage sales on Whatsapp, Facebook, Instagram, to do this, and all of this happened by accident. And as soon as we discovered this behavior, we said, maybe we enable this. Maybe we enable any women in India to start a business like this on WhatsApp, a lot of them would want to and because there are lots of pieces in the puzzle that are a problem to them, which is accessible to supply and logistics payments are the tools they need to get started. The way of monetization is also available which we did not have so far. And as soon as we launched V2 of Meesho, which was to enable the behavior of setting up a boutique on WhatsApp, we saw a crazy amount of growth. And this time, we knew that we are on to something. Until now, we started something after some time realized that was not working. But this time, we saw that a lot of our users started to come onto the platform and started transacting and that’s how we arrived at what we are today.

Siddhartha Ahluwalia 8:26

So I think the biggest growth came from getting distributors on the Meesho app where these women can directly share the link of the product and the shipment will happen on the distributor side, the women will have their mark up which she can decide, not Meesho which decides the markup. Is that right?

Vidit Aatrey 8:47

Yes. So when we started this, we wanted to keep the experience to the end customer as similar as it is to an offline boutique. So if you go to a boutique, no one puts an MRP on products ever, right? Especially in unstructured commerce, there’s a lot of negotiation that happens. If I see a hundred, if you say Rs 100, I will never buy for 100 I will say, give me a 10% discount, maybe because I’m an old customer, or I will, for example, threaten to walk off from the store. So most people let their customers negotiate. And if we had given a fixed price where we fixe a margin, I think that experience would not have been available. So very cleverly, something that had never been done before anywhere in the world. We said we will give you a range, this is the Min, this is the Max. If you sell it min, you make zero margins. If you sell it to the max, you make a maximum margin, but you have the flexibility to price the product. And we saw that this worked really well for all of these women entrepreneurs to convert these customers on WhatsApp.

Siddhartha Ahluwalia 9:52

And you also took logistics and distribution from their sides?

Vidit Aatrey 9:56

Yes. You are talking about women who have to ask permission of so many people to get out of the house, right? Giving parcels ourselves to other people is not looked at as the right thing to do. Some of them were hesitant to have to go for delivery, we said you don’t have to anymore because we will do delivery to your customer. You just go and do what you do, which is curating the right product, selling it to the people and after that everything, including logistics, including returns in case the product that your customers got is not liked, cash on delivery. So that even payment collection is not your headache, it’s our job, but taking away all the pains that existed in this model to us and just letting her do what she loves doing was a big thing and especially for her user base. If we had not done this, this would have never taken off.

Siddhartha Ahluwalia 10:50

And how did you get so many distributors and I think today you have more than 20,000

Vidit Aatrey 10:58

Now we have about 40,000.

Siddhartha Ahluwalia 11:00

Wow! How did you get initial 1000 or 10,000 distributors?

Vidit Aatrey 11:04

Yes. So, getting suppliers, manufacturer, trader on the platform now in 2020s, even in 2016 was not that hard because Flipkart and Amazon had done so much work in terms of getting these small or large businesses to learn how to put products online, price them, cataloging them getting to the top thousand was not that difficult, by the way. Now at 40,000, we realized that a lot of these very, very small manufacturers have never come online. Mostly the big guys have gone online on Flipkart and Amazon. Now we are doing a lot of innovative stuff to train these guys, helping them as much as we can build more hand-holding experience in the beginning. But at that time getting all these manufacturing from towns such as Surat, Ahemdabad, Jaipur Panipat solved most of the problems.

Siddhartha Ahluwalia 11:55

Today, if you can share more about the scale of Meesho, how many daily transactions happen?

Vidit Aatrey 12:02

Yeah, so we don’t share transactions or other business-related information. But in terms of scale, now we have very close to 3 million women entrepreneurs across about 4000 to 5000 cities and towns, very hard to even know whether this is a city or town anymore and it’s fairly distributed. So, these many towns and the largest city for India does not do more than 3-4% right, which means we are there across the country and it has to be so because the problem that we’re solving is so universal it exists in large towns, it exists in large cities like Delhi, Bombay, it exists in the remotest parts of the country even in northeast, etc. So we always expected it can be a very pan India Business and it is so.

Siddhartha Ahluwalia 12:46

Initially, we used to discuss this, sitting in a cafe in Bangalore, that investors didn’t understand the model at first, what was the point where, you thought, you have investors chasing you rather than vice versa.

Vidit Aatrey 13:02

Yeah. So the first institutional round for us, which is Series A took the longest amount of time, I think I would say it was the hardest fundraising round for me so far. And that’s when I also learned the most. But I realized that a lot of people in India take the time to understand a new model because there are not a lot of new models in India. Anyways, a lot of large companies have been inspired by the West. A lot of fundraising has happened because of pattern matching, etc. So in our case, there’s obviously a lot of resistance. In the beginning, a lot of people didn’t believe in it. But one thing that really worked for us was traction. So even though we’re not able to raise money, we kept growing at a very fast pace. So everyone who was saying no to us kept reconsidering because the numbers were growing. So something was happening, right. And I think for any startup, which is trying to do something super bold and something very new at the end of the day, things that are not very understandable because they are very new. Like for example, between 2016 and 2017, most people used to say, what does selling on WhatsApp mean? I’ve never seen anyone buying on WhatsApp. This sounds like a marketing gimmick. This sounds like some fad that exists this year and will go away tomorrow because why should people buy? Why won’t they just go and buy on Amazon Flipkart, they did not understand how a lot of community commerce happens offline. Women run boutiques for centuries and centuries, right. But a lot of people, especially in the VC world didn’t understand it. But what they really understood the numbers, so we kept coming back to them. We kept sharing our updates. We eventually realized a lot of these guys acknowledged that this can be a large opportunity. And I think it just got better after that. But, in short, it was mostly traction and growth for us that solved the problem because the business was growing. One thing that we also saw is a lot of VCs who spoke to our users really understood how much our users love us, because it’s very typical that you speak to somebody for users, and they will show an immense amount of gratitude to us because we have changed their lives in so many ways. So, yeah.

Siddhartha Ahluwalia 15:09

And the first round was in 2017 by SAIF 3 Million, Sequoia came in with 10 Million round and Then one thing led to another then Facebook, Naspers. It’s been a dream journey.

Vidit Aatrey 15:25

Yeah, so I think I would never trade whatever has happened to us in the last few years for anything in life. I’ve had the time of my lifetime, building Meesho, working with the kind of people we have in Meesho. I think everything has been more of a dream than anything else.

Siddhartha Ahluwalia 15:43

Well, what has been the thing that has kept the momentum going, you never slowed down. You’ve always kept growing, always humble, always learning and always very grounded.

Vidit Aatrey 15:51

So, I think that comes from the type of business we are in. In our business, none of us are experts at what we are doing like I am not a homemaker. I have never run a boutique. I have never been asked to not work and feel not respected at home. If you are not humble in this business, you cannot make it big because almost everything that we have done, every nuance that we built in our product has come from user feedback. And that user feedback comes when every day that I still don’t know more than I know. And that has to come from that feeling. And everyone in the company knows that. If you come here, one thing that we make everyone do at the time of hiring is to speak to our users and get feedback. We don’t believe in a lot of assumptions that exist in the e-commerce market. We challenge everything because what we’re trying to do something very, very different, very unique for a very different kind of user base. How many people are building a product for homemakers in India only? Very few, right? So We’ve learned only from being very close to our users. And that keeps us humble. And that keeps us wanting to learn more and more because that has only worked for us every year, we have solved some hard problems understanding our user better. And that has helped us propelling the whole growth part for the company. And I think this gets harder every year. Right? What worked last year doesn’t work this year. And what will work this year will not work next year. And knowing this also helps

Siddhartha Ahluwalia 17:30

Share some of these things, you know, pivotal things every year in the last 3-4 years Meesho has done.

Vidit Aatrey 17:36

Yes. So let me share the biggest of them, right. So as soon as we raised money in our series A from SAIF, 3-4 months later, our growth slowed down. And they were like until now everything was going right. We just put in money, what happened? And I’ll tell you what happened. So in the beginning, when we built a product, we go a lot of these homemakers onto a product easily because they were using the Meesho first version, and all of them are existing WhatsApp boutique owners, all of them. So our growth hack was kept getting a lot of them who are not using our app or either available on certain Facebook groups or WhatsApp groups. We went there, did awareness about the Meesho app done. But six months forward, there were about 50 to one lakh women boutique owners before we came into the picture, we acquired most of them, and then we did not know what to do. Right? Because there are only so many women who are doing something like this. Then we had to go back to the drawing board and figure out what can be the next growth lever for us. And it had to be us creating new entrepreneurs out there. Because you’ve exhausted all existing women entrepreneurs already. So what we did, we revamped our complete product. We went back we said the person who will now come to a website would have never heard about So how do we build a new onboarding experience convincing of women who have never seen anything like this? So for example, earlier marketing pitch on the website should get access to products at the cheapest prices, free COD, free returns, it was targeted to someone who really understood how this business work. Suddenly it changed to start your business online for free with zero investment because now we are not targeting someone who’s done this. We are targeting someone who is looking to do something, who’s looking for an opportunity, and it had to target them. We changed how a product looks like, the app earlier used to directly take you to products now when you come, you had to go through educational video where we explained what does reselling or running your boutique on WhatsApp means and then we changed what kind of thing you should sell on day one. How should you create a WhatsApp group so make it in a much more hand-holding experience but it was required because we had to create entrepreneurs now. Otherwise, we would have to be super small then because the opportunity was very small, a lakh user in the long term is nothing. But as soon as we did it and we got after multiple product iterations, we got it right. We just saw it moving very fast. But if we hadn’t solved that problem, then everything else wouldn’t have mattered. And we have seen this. So you figure out something, you milk it for six, nine months. And then you have to figure out something new. And this, I would say is the largest of all things that we have done.

Siddhartha Ahluwalia 20:30

What are the things after this?

Vidit Aatrey 20:33

So, now we have about 3 million women entrepreneurs across the country in less than three years. We will finish three years for this product next month in March 2017. And all of this has happened after that. So, the acceleration that we took off right after the pivot in this product, I would call it a minor pivot because we changed the product. The user base was the same. It was crazy.

Siddhartha Ahluwalia 20:59

What is the average earning per month these women make on Meesho?

Vidit Aatrey 21:04

So, the average is a very bad reflection because we have people who come with very different expectations from this. There are people who come only to make money. There are a lot of women who come here not to make money, the families earning enough but they coming here because they want respect. So I’ll give you a story. I recently was in one of our community events, which is called mission Rise in Varanasi. I met this lady, she came to me and said, I want to thank you in person. Because what you’ve done for me is very bigger than anything someone could do. Before Meesho came into my life. I used to be known as someone’s wife or someone’s mother in my locality. Now everyone knows me. From the business name that I’ve created from issue. She does not care about money, the car has been earning enough money. The problem was that no one used to care about her, no one used to respect her. So now she’s known as a fashion influencer in a community, she gets certain respect in the community for that. And she feels more confident. So a lot of people who come onto the platform not just coming to make money, they come looking for an identity, which will give them some standing in the community. So that’s why the average number doesn’t make any sense. We have people who make a thousand rupees per month and are active every day on the app. And you speak to them, money’s not the first thing at all for them. What they’re looking for is respect. And they don’t get it in their community.

Siddhartha Ahluwalia 22:35

And how do you define success for these users as there are different user personas?

Vidit Aatrey 22:45

The way you become successful in the platform is I am giving a great experience to people around me when I’m curating products for them. And NPS is one metric for some people NPS is high because they make money, for some people NPS is high, when they give a great experience to people, even if they have few orders per month. And if you’re able to do this, then people come back to the app again and again. And sometimes it’s the same thing, like when people who make money they make money by selling to the same people again, and again, they are just much more incentivized to acquire a lot of people around them because they want to do more sales, other people will not be as aggressive, they could be selling to just 20 people and will be happy. But generally not two things. giving a great experience to my consumer, essentially salsa, both is just the first person is looking for more ideas, more training, more tools so that they can run certain things where I would say certain contest, anything else to acquire more customers, but they’re just doing it a lot more for money. But these are not two different things in that sense.

Siddhartha Ahluwalia 23:54

And if you say for the top 1000-2000 users, do you have a metric that how much these women earn from the platform?

Vidit Aatrey 24:02

Yes, so my top 10% of the user base now does about close to 15,000 rupees worth of sales per month average. And this is across the country, I mean, but the categories vary. So that would be the average number

Siddhartha Ahluwalia 24:24

There is no parallel to Meesho in the world.

Vidit Aatrey 24:28

Yes, because there is no parallel to India in the world like the kind of problems we’re talking about if you so let me give you another stat, which is super surprising to me The first time I heard even among developing peers, the participation of women workforce in India is the lowest across the world. 70% of women in India don’t work after marriage. And that number is above 80% for large cities. So rural in rural areas when participation is even higher. Whereas in urban cities, human participation is lower. So the kinds of problems we have are unique until now you’re just solving a lot of we are getting Western solutions to Indian problems. It’s solved for the top four, six cities. But beyond that, no one is thinking about how to solve problems for India. So all of this has come from our history like our cultural background is very different. The kind of cultural baggage we carry around how we treat women, how are they allowed to work in a particular system is very different. And that’s why we had to think very bottoms-up understanding how do we solve this problem.

Siddhartha Ahluwalia 25:29

You created a category, I think there was no word called social commerce before Meesho in India. It just coined after Meesho, once you gained traction and the competition even started. But you have been able to keep 10x ahead of the competition. What was the reason for that?

Vidit Aatrey 25:45

Because we’ve always thought of the user. So, people who have come after us have mostly cloned what we have done. When you’re doing what we’re doing, you’re always doing what we did six months ago. And you’re always ahead in terms of ideas because you look at the user and then you understand what problems she’s facing. And what does she want to get become and more successful? And just that focus has made sure that we are always leaping ahead of anyone else.

Siddhartha Ahluwalia 26:12

Do you still call your users?

Vidit Aatrey 26:15

Yes. Most people in the company do, It’s not just me. So for example, we have a program that is called ‘listen or die’ in the company. Everyone in the company has to speak to users within 30 days every month. And then you have to submit a report of what kind of feedback you got and what we can do to solve some of our user problems. But we have to do it. And why we do it again, is because most of the people in this company are not the target user for our app. So how will they ever know what problem we are facing? So I do it, I do it every week. Most of the company does it every month as part of this program, and most people enjoy it because a lot of times you’re working, you’re coding something But you never understand the impact of what you developed when you speak to someone, and she talks about how her life changed because the product you build, suddenly feel a lot of pride in yourself that I am ]lp;./solving a large problem for India where I was born. And a lot of people talk about it, but very few people get the opportunity to do something like this.

Siddhartha Ahluwalia 27:18

Does even the developer speak to the customer?

Vidit Aatrey 27:20

Everyone, including developers, and developers love it more much more than others because developers are not the frontline guys. They get to know about the impact, as I said, of their product only when they speak to these users.

Siddhartha Ahluwalia 27:33

How does Meesho make money out of the scale which is today?

Vidit Aatrey 27:37

So, we take a cut, a take rate from all our suppliers, every time a sale happens. So, if I give you the perspective of our supply base, most of these small manufacturers who could never find a distribution channel working for them online. Before us, they were primarily selling offline to retailers or wholesalers distributors. But now because we have given them a channel, they are finally coming online for the first time. And then these guys are super happy to share some of the increased earnings with us. And that’s how we make money.

Siddhartha Ahluwalia 28:18

What do you think will unlock the next level of revenue growth for Meesho?

Vidit Aatrey 28:24

So, we don’t think that much about revenue growth as much we think about how do we make our users more successful. Our biggest culture value is every day, we have to get better and better at making our entrepreneurs more successful. And if that happens, we’ll make more revenue for sure because if people become successful, especially on both sides of making money, they’re always very happy to share those earnings with you, and they’re also aligned with your goal. So we don’t think as much about revenue. But if you talk about how will we grow as a company and how will we grow as a community, so, there are three things that we focus a lot on like we focus a lot on what kind of TGs we haven’t solved the problem for, because India is a very heterogeneous country by the way, as soon as you go beyond the top six cities in India, people speak different languages, people in different cities have very different taste for fashion. The kinds of sarees that sell in South India are different from what they sell in East India, even among South India, all four states have different kinds of saree selling. So you have to localize selection for each and every place, you can add a lot of categories that are relevant in different parts of the country. So that is definitely one opportunity that we keep focusing on keep getting better. Second is how do you make your product onboarding experience relevant to more people for example, we started with homemakers which did a good job. And recently we started to focus a lot on younger women. So a lot of younger women who are in colleges now want to become famous on Instagram wants to become a fashion influence on Instagram, they leverage a product to do so. Now we have a lot of working women who are basically teachers or working in banks but there’s, like, passion is around trends around fashion. And they fulfill that dream because of us part-time. So working women are doing this, we have started to see a lot of retired people, retired women, especially are doing this to make some pension. So a lot of different user profiles are coming. And then a lot of our focus, how do we get more and more of them on the platform. And the third is purely about geography across the country. So we are very good and the east and south part of the country because more and more women are literate and educated. But we still struggle a lot in the north and west parts of the country. Because the same product doesn’t work. A lot of them come on to the app don’t understand what this is about. They don’t know what should they do the first three to four things to get started. So we are building a more hand-holding experience getting a mentor to the local, who will help them in getting started. We are building a lot of content in their own language so they can understand how to use this app. But how do you get to more geographies than where you are already? Now we just recently even launched in Indonesia. Because we realize this problem is not just in India, but in a lot of other developing markets. And Indonesia is one of the largest ones out there. And in the last two months, we have the same kind of scale that took us 18 months in India. So even that is showing a lot of potentials. So for us, geography is just not India, but global.

Siddhartha Ahluwalia 31:38

Any developing market where women’s participation is less?

Vidit Aatrey 31:41

Yes, and I’ve seen it almost everywhere we go. We went to Indonesia. So my last Chief of Staff, Nikita, she spent some time in Indonesia, and she realized it’s exactly the same story. You ask these women what’s the biggest problem, they say I have to lock money in this, many times I run out of business and I’m not able to sell this inventory. So we went to the same user base, now it’s working. So this is a very, very global problem, sitting in India because we see what’s happening in India, we see it’s only here, but all developing markets face it. And because we have built it for the first time, globally, we can take this product and take it to other developing markets before anyone else.

Siddhartha Ahluwalia 32:25

So tell us about the culture of Meesho, you seem to be very user-driven. and what are the other factors of the culture of Meesho which the team embodies?

Vidit Aatrey 32:34

Yes. So there are a few things that we were very lucky at since the beginning, and we try to retain that DNA in the company. Few things evolve as the scale of the company grows, but few things don’t change. Like for example, when we started to hire a few of our first leaders in the company, so Prateek, who earlier used to run a startup called Bite Club, was the first leader who came into the company to lead business He was an ex entrepreneur. The second guy who came in was Harshit. He was running a FinTech business before the next entrepreneur. Why? Because there was a big startup boom in India and 2014, 2015, 2016. Most of these guys are shutting down their startups in 2017. That’s when we started to hire. And then because of that, coincidentally, we got a lot of people with a very strong entrepreneurial DNA, people who take ownership of every small thing that they do and take it to a conclusion. And very soon, I realized that most people in the company, even our first few developers, all of them are ex entrepreneurs. So people who do much more than we expect them to do because they feel the skin is in the game because they have run a company before. So now we try to maintain the same DNA, even at this scale and we hire people is this person, super entrepreneurial in terms of how they take ownership of how they think less about the functional skill they have, but more about the outcome that they want to get to? Whatever it takes, but can I get to this outcome? This is I would say one of the largest or most prominent cultural DNA that you will find across the company.

Siddhartha Ahluwalia 34:08

What were the early challenges while building the Meesho of today?

Vidit Aatrey 34:19

Team, as I said, team is definitely a challenge that anyone faces when you are a small team and you don’t have money. And still, you want to get the best of talent. So it took us time to build the right team. But the good thing is when you don’t have a lot of money, and you still try to hire a lot of talent, you will be forced to hire people who are not coming here for money, but they come in for the larger thing. And that helped us set a particular culture the company if we had a lot of money on day one out amongst overpaid, most people who would have come here, thinking that I’m getting a lot of salary in this company, and they would have come here to do jobs. So some of these challenges are definitely opportunities for any And so I would say definitely building the right team, in the beginning, was a big challenge. Apart from that, everything else will solvable, right? I wouldn’t say there’s some particular challenge. fundraising was definitely one of them. That I would say. And the third thing that I would say at the end of the day, we struggled with a lot some time ago, and it’s not as much of a problem now is how do we get to a lot of these users? Right. So as I said, I talked about how we struggled to get a lot of existing boutique owners onto a product that changed. That happened because we solved that problem by tailoring a product to it. But I would say these would be the few problems that we faced in the beginning.

Siddhartha Ahluwalia 35:50

Your go-to-market changed over a period of time. I remember there was Facebook, then Meesho has been seen on TikTok.

Vidit Aatrey 35:59

So we use everything. I think we’ve always been very, very creative in terms of how we approach go to market. So even now, a good chunk of our user base, about 10% of all our acquisition happens through influencers on YouTube, and Instagram. Who are these influencers, these influencers are local influencers in tier three, tier four cities who talk about opportunities to people, a lot of people don’t know about them. A good 10 15% of our total acquisition rather more, I think it’s about 20%. now comes from user reference. Why because we have a women user base who are active on social platforms, it’s not a lot of effort telling other people in your family about this opportunity. And that was really one of the big ways of how we could grow so fast. So leveraging referrals where people recommended people in their own family was a big fit for us to grow. And then we have been very creative in terms of using a lot of platforms that are for the next hundred or 500 million, I would say such as Tik Tok, Whatsapp is big for them. Facebook is big for them. And now we see increasingly Instagram is also coming up. But we’ve always been ahead in terms of seeing where our user base is.

Siddhartha Ahluwalia 37:16

How do you ensure that you as a leader, growing at the same pace as the company grows, you’re not falling behind?

Vidit Aatrey 37:25

I don’t know. To be very frank, I can say all the great things like hey, I’ve done these four things. And I know I’m relevant, but you just have to keep getting very smart people in the company and they’ll push you and then you realize where you stand. So every year, we have hired leaders who are better than the whole of the leadership team. And when they come and when they perform and then deliver, you realize that hey, this is where I stand, I need to keep improving and I need to keep learning. One of those ways has been through mentors in the startup ecosystem. Some of them have been like mentors in the valley because we were at YC, which was also great. So all of these things helped me create some network where I can learn from people, but you get pushed when your team pushes you. When you have smart people working with you, everyday challenging you, you know that you have to keep improving. And the only way to improve is by learning.

Siddhartha Ahluwalia 38:19

What does your daily schedule look like?

Vidit Aatrey 38:23

So the good thing is, I don’t want my daily schedule ever to stay the same. So if it’s monotonous, I generally go about changing it. But if you ask about my time allocation, I spend about 20% of my time in hiring, even now. It used to be much higher earlier, but a lot of rules are now hired by other leaders in the company. I spend, I spend about 10 to 15% of my time every week again speaking to users about 30 40% of the business reviews Take some of that more time. And the remaining is quite unstructured, which I generally keep open. It could be about reading something, it could be about catching up with some teams. Anything else, but that’s broad. Few things that I never compromise on is definitely speaking to users, and making sure that we’re hiring at the right pace. Increasingly, I started to spend some more time around how do we think about culture building? Because two years ago, that didn’t seem like a problem. Now when you are about a thousand people, it becomes very, very important. So we are much more thoughtful around how do we approach that? What kind of things should we do internally? So it also takes some time.

Siddhartha Ahluwalia 39:41

You have spent some time in the valley? Why did you imbibe from there that is a part of your company now?

Vidit Aatrey 39:47

So, In the US, people have a lot of focus on what they do. So one thing that I was very surprised by people who are achieving a lot with very small team sizes, extremely small team size like a team of four people doing revenues of millions of dollars per year. And the one thing that I realized everyone is just focusing on one or two problems, and they will not do 10 things. It also comes from the fact that a lot of ecosystems is developed. Like for example, if you want to solve one thing, you will have an API for almost everything else, and you just focus on solving one product problem. Whereas in India, that did not seem to be the case. Whenever I worked in some companies and I spoke to people, a lot of people always doing a lot of things. Team sizes are larger, which generally takes away focus. So always tried to bring back everyone to saying, Hey, I know now we have resources, we can do a hundred things. But this is the core of everything, which is making a user successful. You can do hundreds of other things because you have team members, you have time bandwidth to do all of this, but if you don’t focus on what the core is, very quickly you start to do a lot of things because it shows growth but you lose the edge. And one thing that I saw in the US and like people who are doing one thing they were just doing it really well big companies for example Stripe, right in the beginning just doing one thing extremely well. A lot of companies in my batch again were doing one thing extremely well. So I think that’s one learning that I took from the valley. One value makes us successful everything will come out from there.

Vidit Aatrey 41:45

I think I just answered it’s been after we realized what kind of DNA work for us, which was people who more entrepreneurial, take more ownership. We just focused on it. Now even the company structure we have is aligned to that kind of DNA. So for example, we don’t have a functional structure of the company, we don’t have a head of product, head of business, head of x, y, Z, we rather have general managers who own outcomes in the company. So one person owns number of users in the company, one person owns the amount of business every user doesn’t on the platform. And they have teams across different functions to get to this outcome, so product team tech team, marketing team, everything in under one guy. So it’s more like mini startups within the company rather than functional leaders, because we realized that we’re fortunate enough to have so many entrepreneurial guys that we should enable them with the right tools rather than making make them specialized into something that they don’t like.

Siddhartha Ahluwalia 42:42

Because entrepreneurs are more generalists?

Vidit Aatrey 42:45

Yes, generalist and a second, they get a high more from achieving a goal, rather than for example, building a feature or launching a marketing campaign. Right? It’s not about achieving greater heights in your function. It’s about achieving goals for the business. So people, some of these guys are specialists as well experienced in certain things much more than others. But they don’t feel high in building something functionally. And I think that’s very important, like what gratification motivates you. And we see some of these guys get it because they’ve been x founders, right, x founder, like I don’t get a high end seeing a great marketing campaign in the company. It obviously makes me feel good. But what makes me feel good at the end of the day is someone on much more than they were doing yesterday or someone got more respect in the community than yesterday And that goal does not come from one function that comes from everything coming together and delivering a great product for example.

Siddhartha Ahluwalia 43:50

So you have gone to raise series E?

Vidit Aatrey 43:55

Series D.

Siddhartha Ahluwalia 43:57

Tell us about your experience. How has your pitch changed in every round from selling to vision then talking about the numbers, then talking about the market size?

Vidit Aatrey 44:10

The vision never changes much. It’s just the scale changes and with scale, the kind of things you can do changes. Like, for example, two years ago, we were not focusing on five different types of TGs. But we do today. For years, like two years ago, we’re focusing a lot on just homemakers understanding what their problems were. But now the kind of resources we have, we can like to focus on homemakers plus students plus, working plus someone else, retired folks, all of that. But the problem that you’re solving is still the same ambition is still the same we want anyone in India focused at women start their online store without any investment. It’s exactly the same thing that we had three years ago, it hasn’t changed a bit. The only thing that has changed is the numbers. So we go and just show larger numbers to raise money. But practically nothing has changed work.

Siddhartha Ahluwalia 45:05

Does it work?

Vidit Aatrey 45:05

It does but because we focus on one thing only like we want to focus only on one thing. I’m not doing 10 businesses in our company, which is very common when you have a lot of resources in India like you want to do X Y Z everything happening. We continue to focus only on one problem that we will solve and we continue to solve that better than anyone else. But practically everything else has remained the same.

Siddhartha Ahluwalia 45:32

So If investors asked you earlier about market size, how could you define it?

Vidit Aatrey 45:38

So, we tried everything, by the way, to figure out how do you slice and calculate what this market should be like for example, we took a number of women who are running some boutiques or jewelry stores. The problem was they were never registered. So all of these were top-down numbers with some guests estimates, we created those but no one knew accuracy was that great as much. We looked at the numbers of women who are entrepreneurial. And there are certain proxies of that, how many women are part of direct selling companies, they are entrepreneurial how many women are part of like, for example, these MFI is doing something around them. It gives some numbers. But they were proxies at best, right? No one ever knew how to calculate the market size. And we also did what everyone else could do.

Siddhartha Ahluwalia 46:38

If I ask you one thing, which Meesho has replaced in the physical world. My guess would be the MLM kind of network.

Vidit Aatrey 46:45

No, it’s the fashion boutique. It’s the fashion boutique that women run out of the houses. So we also realized over time, these two first things that the same user base it’s very different. People who work with MLM companies are agents for that company. Being an agent does not come with a lot of respect. It’s more a broker for a particular company. In our case, we have seen we, which was, again, a very contrarian move. Most people discouraged us from doing this, we do not put Meesho’s name in front of the consumer. Right? We want this lady to create our own brand. Because with that brand comes her identity with that identity comes to respect and confidence, which is a very core part of the gratification that you get from the platform. It’s super important that you deliver this. Women you who used to run boutiques earlier were looking for this gratification. Women who were part of MLM were not. So this is a very different kind of user base. And we consciously choose this. I’m not making my user base go out and say hey, I’m a Meesho agent, buy products from me. That’s what I’ve been given.

Siddhartha Ahluwalia 47:54

But women on Meesho app call themselves Meesho resellers.

Vidit Aatrey 47:55

Because she feels part of the community. It’s more like you belong to a particular club. But you’re not an agent for them. She’s doing it as her own business. She leverages her own connections. She leverages her own influence on people around them. People not buying because this is a particular branded product people are buying because people believe in her curations, in her recommendations, it’s her own brand. So growing that is much more important than anything else. So practically, these are two different kinds of users sets.

Siddhartha Ahluwalia 48:34

Ultimately, you have now been able to build a brand for each of these millions of women.

Vidit Aatrey 48:39

Yes. All of these are individual brands now. People recognize them with this and that’s where the identity comes from.

Siddhartha Ahluwalia 48:49

So Vidit, we are just coming to the conclusion of the podcast, any habits which you have followed through which you attribute to your success.

Vidit Aatrey 48:58

Apart from being very close to users, and just making sure that everyone in this company is very focused on the user. One thing that I have tried to do and it’s less of a habit, more of, I would say, again, a value for this is, irrespective of how fast you’re growing, how many people you need, do not compromise on culture fit. We are very, very conscious of the kind of people we get in the company. Because if you’re spending 18 hours per day, in some place, unless you like working with certain kinds of people, it’s very hard to be there. So what we have done is we kept that bar firm over the last three, four years and I don’t think that’ll ever change. But that’s it. Just make sure that you have the best people out there. People who are I would say best for this particular business, focus on who the users are, everything else will fall in place. I don’t think you will grow you will get good partners, investors, you will get everything that is right for the business if you do these three core things right.

Siddhartha Ahluwalia 50:00

And entrepreneurs who come to you for advice on fundraising, what do you advise them?

Vidit Aatrey 50:05

So, yesterday I was meeting someone and it’s very common now I was just telling someone who was quite demotivated that I am trying to do something very unique. I’ve been at this for the last one year and no one is funding me. Am I doing something wrong? And I used to feel the same back when we’re trying to raise a series A and I tell people, exactly this thing, forget, raise a smaller round, keep growing, eventually people will realize because when you’re trying to do something very new, it takes time for people to understand like everything always makes sense retrospectively right for everyone. So you can only do pattern matching for something that happened five years ago, but you can’t make money on that anymore. So you have to believe in something that you’re doing, irrespective of what people say, continue growing, but whatever efforts you can and if you continue to show traction and growth or sometimes people will fold and people will come to you and help you in growing that business, but you have to stay focused on what you’re doing. You should not ever take an investor’s no as validation. That’s the worst thing that you can ever do to a business because most investors look retrospectively. So they are looking at businesses that have been already proven. If you take validation from investors, you will never be able to do anything new. Right? It’s always the entrepreneur’s confidence and belief in something. And that will always come by you being closer to the users, no investors always spending time with users, you are. So you know how big a problem is to a particular user, and how much they will value when you build a particular solution. So this is what I say I’m saying you believe in something, stay after it. keep growing people eventually realized that this works.

Siddhartha Ahluwalia 51:47

Thank you so much for being on the podcast.

Vidit Aatrey 51:49

Thank you so much, Siddhartha. This was great.

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