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Thursday, December 7, 2023

Shopflo raises $2.6M in Tiger Global, TQ Ventures led funding round

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Shopflo has secured $2.6 million in a seed funding round. Tiger Global and TQ Ventures led the round in the ecommerce enablement startup.

Shopflo, an ecommerce enablement firm, announced a $2.6 million seed fundraising round headed by Tiger Global and TQ Ventures. The round also had the participation of Better Capital and a group of angel investors from the Indian startup ecosystem.

Shopflo is now one of the few Indian firms at the pre-product stage that have gotten seed investment from Tiger Global. While Tiger is a multi-stage fund, it seldom invests in seed-stage startups.

Shopflo, founded in 2021 by Priy Ranjan, Ankit Bansal, and Ishan Rakshit, is a platform that enables direct-to-consumer (D2C) companies to enhance their checkout experience and conversion rates on their own websites.

It also contributes to personalizing these checkout experiences for customers across businesses.  Currently, the business has partnerships with six merchants, including D2C enterprises and a rollup commerce brand.

It has also formed alliances with prominent payment gateways such as Razorpay and Cashfree to provide checkout payments to its merchant partners.

Shopflo’s chief executive officer (CEO) and cofounder, Ranjan, said, “After interacting with over 100 small merchants, we discovered that there is still a checkout gap between smaller companies and larger platforms who own their checkout experiences. We want to ensure that customers have the same checkout experience across all small D2C companies they purchase from by using Shopflo, and we want to enhance conversions for these smaller merchants. We are already witnessing a 15% to 20% spike in conversions for several of these businesses.”

This fiscal year, the business intends to expand its offering to 150 online retailers and handle up to $300 million in gross merchandise value (GMV) checkouts.

Tiger Global partner John Curtius said, “A flawless checkout experience has become a customer basic expectation. However, e-commerce checkout hasn’t altered much in the recent decade. This will be changed by Shopflo. Shopflo is well-positioned to become the default checkout for India’s rapidly increasing D2C sector. We are thrilled to be their first backers on this trip.”

Tiger Global has also made a global investment in Nacelle, a US-based company that operates in the ‘headless’ commerce market.

Companies in the ‘headless’ commerce field are ecommerce infrastructure providers that do not control the storefront or website, nor do they run payments, but instead provide tools in the middle layer to improve consumer experiences.

Vue Storefront and Commerce Layer, two global ecommerce infrastructure tool providers, have also secured funding from YCombinator and Coatue Management, respectively.

While the focus remains on developing the business and finding the perfect product-market fit, Shopflo wants to expand worldwide after its first year of operations, as well as create expanded solutions in discounts and customer loyalty, among other areas.

Schuster Tanger, co-managing partner at TQ Ventures, stated, “Indian e-commerce is a massive trend. The checkout section is at the bottom of the funnel, with the most intent consumers. We were pleased by the Shopflo team’s breadth of expertise of both D2C and payments SaaS.”

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