One of the most successful Silicon Valley-Asia venture capital firms is counting on the humble mom-and-pop store that dominates India’s retail landscape. Menlo Park, California-based GGV Capital is backing startups that serve the tiny kiranas.
“We’re backing startups that provide technology and working capital to make kiranas more efficient, so that these mom-and-pops can become e-commerce and lending enablers in their communities,” Hans Tung said.
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From the poshest neighborhoods to teeming slums, typical Indian kiranas are cramped spaces that are full of sacks of rice, lentils and dried chili peppers. Their floor-to-ceiling shelves are stacked with toothpaste and cooking oil, and their shopfronts festooned with colorful bags of potato chips, tiny sachets of shampoo and pickles.
Recently, GGV has put money in Khatabook, a mobile app that’s a digital version of the bahi khata, or the hand-written ledger that owners of tiny businesses traditionally use to keep track of daily accounts. It’s an earlier-stage bet so the investment is “lower”, Tung said.
In India, even the biggest conglomerates including Tata and Reliance have been unable to diminish kiranas’ dominance while newer online retail entrants Amazon and Walmart-owned Flipkart are trying to embrace them, using the shops to facilitate deliveries or offer assistance to customers going online for the first time. Reliance has already said it will equip kiranas with technology as part of its online-offline e-commerce model.