The world’s biggest e-commerce company has shown that it isn’t averse to purchasing niche Indian tech players to quickly grow its offline presence.
Amazon has acquired Bangalore-based retail tech startup Perpule for Rs. 108 crore. Confirming the news of acquisition, an Amazon India spokesperson said Perpule’s cloud POS will help offline stores manage their operations better. “Perpule has built an innovative cloud-based POS offering that enables offline stores in India to better manage their inventory, checkout process, and overall customer experience. We are excited to have the Perpule team join us to focus on providing growth opportunities for businesses of all sizes in India while raising the bar of the shopping experience for Indian customers,” the spokesperson said.
Perpule was founded in 2016 by Abhinav Pathak, Saketh BSV, and Yogesh Ghaturle, who were working with Goldman Sachs in the US, and noticed long queues at checkout in large stores on big shopping days. On returning to India, they decided to build a product that made queues shorter at offline stores. Perpule’s flagship product, the UltraPOS, claims to enable offline stores to reduce billing counter size by up to 40%, and helps increase sales and revenue through an AI and data-driven approach to dynamic offers, cross-selling and upselling techniques. It is already being used at several retailers including Vishal Mega Mart, Big Bazaar, HyperCITY, Foodhall, More, SPAR, 24Seven and Spencer’s.
Through its journey, Perpule had raised $6.3 million (Rs. 45 crore) from investors, and its Rs. 108 crore deal will will reportedly give early investors 4-5x returns. Most of Perpule’s employees, including the co-founders, are likely to join Amazon. Amazon is also likely to pay additional remuneration to Perpule’s employees, which will take the deal value to about Rs 150 crore.
Amazon seems to want to use Perpule’s technology to enable smaller kirana stores to bring their operations online. This could be a part of a strategy similar to Reliance Jio’s, which has been sourcing products from small kirana stores for JioMart. It had earlier been thought that India’s upcoming e-commerce battle will be one between Amazon’s inventory-led model and Jio’s more dispersed model that utilized small shops, but it now appears that Amazon too will be using smaller stores in its e-commerce operations. Reliance, for its part, also has large stores which hold inventory including Reliance Retail, Big Bazaar and others, and will likely utilize them for its e-commerce operations as well. As the three big e-commerce players in India prepare for their upcoming showdown for India’s shopping sweepstakes, it appears that they’re all borrowing liberally from each other’s approaches in trying to grow their businesses.