2021 could well herald a new phase of large IPOs by start-ups: Saroja Yeramilli
While the global pandemic has bought economies to a halt and massively disrupted businesses, it has also fuelled start-up dreams and we even saw several Indian start-ups achieve Unicorn status during the pandemic period. The times have never been better for the budding entrepreneurs to give wings to their start-up dreams.
The Government, too, has come up with various schemes to support its ‘Vocal for Local’ drive. A case in point is the recent Rs 1,000 crore Start-up India Seed Fund announced by Prime Minister Narendra Modi during the Start-up India International Summit 2021 held earlier this year.
Adgully is turning the spotlight on the entrepreneurs who fought against all odds to bring their dreams to fruition in our special series – START-UP STARS. We at Adgully wholeheartedly support the ‘Vocal for Local’ movement and over the next few months will be featuring all local/ homegrown businesses, brands and Apps.
Conceptualised as a lightweight fine jewellery brand for everyday wear, Melorra is a start-up with the potential to disrupt the Indian jewellery market as it stands today. So far, Melorra has delivered to over 2,000 towns in the country and made its mark everywhere – from villages with a population of less than 10,000 to cities with population above 1 million.
In conversation with Adgully, Saroja Yeramilli, Founder and CEO, Melorra, takes us through her journey as an entrepreneur, the strong headwinds for the Indian start-up ecosystem and much more.
Please take us through your journey as an entrepreneur. What motivated you to establish your start-up? What were you doing prior to turning an entrepreneur?
In my career spanning over two decades, I have worked with some of the world’s leading consumer brands, including Ogilvy, Titan, Tanishq, Marico - Kaya and Dell, in various positions. It was during a visit to one of the well-known jewellery stores a few years ago that I chanced upon a conversation between a mother-daughter duo who were buying jewellery. The daughter’s reluctance to buy jewellery she couldn’t wear on a daily basis stayed with me and inspired me to start Melorra, a start-up with the potential to disrupt the Indian jewellery market as it stands today. The conversation made me aware of the huge gap in the kind of jewellery young women want and what traditional players were offering.
Melorra was conceptualised as a lightweight fine jewellery brand designing affordable jewellery for everyday wear. Inspired by international fashion trends, our designs are lightweight and stylish, keeping the modern woman’s changing needs in mind. We have launched four new physical experience centres recently. The first one was in Bangalore and the three others are in Delhi/NCR. Our brick-and-mortar expansion is intended as a seamless extension of our online retail space providing customers with anytime, anywhere lightweight and trendy gold jewellery. We plan to launch 350 such centres pan India in the next few years. The stores, which will primarily be located in malls and high streets across India, will range from 500-1,500 sq ft in size and showcase 500-1,000 jewellery designs. Melorra has proved its business model and we continue to improve our offerings every time. For our recent offline foray, we plan to invest around $50 million over the next 6 years.
So far, Melorra has delivered to over 2,000 towns in the country and made its mark everywhere – from villages with a population of less than 10,000 to cities with population above 1 million. The offline centres are an extension of our online space. Melorra has a very strong customer base in both metros and smaller towns alike. Our customers in the Tier 2 and 3 cities are also waiting for a Melorra experience center and we plan to also branch out to these areas going forward.
What need gap did you want to fulfil with your start-up? What is the core business proposition?
Fine jewellery has always been looked upon as an investment, with purchases driven by special occasions like weddings. Most of the jewellery industry caters to this segment and lacks trendy options that can be paired with the western wardrobe. Consumers today are also more in sync with recent trends in jewellery and fashion. There is an increase in their disposable incomes that has led to a change in their lifestyles and preferences. All these factors have resulted in increased demand for trendy, contemporary and versatile fine jewellery.
We create and sell precious jewellery through our online portal, www.melorra.com, and now our experience stores also meet the modern requirements of the new Indian woman. Melorra combines technology and fast-changing weekly fashion trends to deliver exclusive gold and diamond jewellery to customers.
We are working towards changing the perception that gold jewellery is only meant for the lockers, and integrating it with women’s everyday wardrobe.
How did you identify your TG? Did you carry out any feasibility study prior to starting your business?
Yes, before I started Melorra I carried out a pan India survey of millennials and Gen Z and their fashion sense and their needs with respect to gold jewellery. Their dissatisfaction with the offerings of the traditional players that didn’t meet young women’s changing lifestyle needs led to the launch of Melorra.
What were the challenges that you faced in your start-up journey and how did you overcome them?
I didn’t face the usual challenges of founders, especially with regard to fund raising. I raised the largest seed round in India of $5 million.
Funds/ finance is the prime issue of almost all start-ups. What can the industry and the Government do to address this issue and ease the capital requirements of start-ups?
Funding has never been a challenge for us and we raised the largest seed round and multiple rounds post that, we recently raised $12.50 million in an oversubscribed funding round led by Symphony Asia (one of Asia’s first private equity firms), Lightbox Ventures, Alteria Capital and other leading family offices.
Finances dictate a start-up’s success or failure and this is where funding becomes imperative. A start-up goes through multiple rounds of funding during its growth phase, at the core of which lies a solid idea and a plan on how this will be executed. It is important to understand that most investors will focus their attention on the core team and ideation. The government can ensure simplification of business, which can be facilitated by the implementation of the National Ecommerce Policy. By making it simpler and easier to do business, we can attract more foreign direct investment, which will in turn generate more employment and economic growth in the country.
Earlier this year, Prime Minister Modi announced a Startup India Seed Fund. How do you see start-ups benefiting from it?
The Startup India Seed Fund announcement augurs well for entrepreneurs who are looking at initial funding for their start-ups. India is one of the largest start-up ecosystems in the world and this seed funding will encourage budding entrepreneurs to take forward their ideas and not back out due to lack of initial funding opportunities.
How is digital helping you further your business?
Melorra is on the cusp of fashion, jewellery and technology. We have always been a digital-first company. From designing digitally with no physical prototypes or inventory, to 3D printed manufacturing technology to an online platform for selling through site and apps, to digital marketing – Melorra is through and through a digital company. Even in our offline experience centers digital is playing a key role in storytelling and design launches.
What were your key learnings from 2020? How do you see the start-up ecosystem progressing in 2021?
Melorra is primarily an online company offering the largest range of over 10,000 original designs in lightweight gold jewellery. We have not only recovered to pre-COVID-19 revenues, but have moved to a growth phase of 20% year on year growth now.
There has been increased demand from all town classes, income strata and even age groups now. Earlier, it was people younger than 35 years shopping online, but now there is demand even from the older age groups. Our ticket size has gone up 65% compared to pre-COVID levels since people have started feeling comfortable shopping for more expensive jewellery items such as necklaces, heavy gold chains, bangles online. We are forecasting the best year end revenues this March than we have ever had and are accelerating our expansion plans since the recovery out of lockdown has been so strong.
India is not only one the largest start-up ecosystems in the world, but is also on the cusp of a massive growth in start-ups. Many start-ups in e-commerce have now reached maturity and 2021 could well herald a new phase of large IPOs by start-ups.
What would be your message for the budding entrepreneurs?
My advice to budding entrepreneurs would be to believe in their idea and follow their dream wholeheartedly. Despite initial challenges that every entrepreneur faces, with diligence and persistence, the outcome is also positive. There is no better time to be an entrepreneur in India! From government support to interest from domestic and foreign investors to the best talent pool to, most importantly, a large and growing domestic market – India offers the best opportunity now!