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Zepto: How Passion, Persistence and a 10-Minute Promise Built One of India's Fastest-growing Startups

Within months of founding Zepto, quick commerce was the fastest-growing category in the consumer internet space in the country and we were the fastest-growing Indian companies of all time

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Entrepreneurship is complex, especially if you’re building a category that never existed. To wake up each morning with a dream to make a change, and to keep at it every day requires intense passion and even deeper commitment. That’s what it took to start Zepto in the midst of a pandemic – a passion to solve a problem that was intrinsic to every Indian household. Two years later, that passion has turned into a business founded on customer obsession, experiments, failures, and more than anything, learnings that came from being bold.

Building one of India’s fastest-growing startups in the consumer internet space has been a humbling journey but certainly not with its own set of challenges.

Embrace passion, persistence, and failures
In 2020, during the lockdown, getting groceries was enormously painful with limited windows of in-person shopping and online options taking many days to deliver. Finding a solution to this problem was initially just a fun side project while stationed in Mumbai amidst the pandemic. This prompted my Co-founder, Aadit, and I to start looking for a solution. We launched multiple products and tested different models, from a pick-up-and-drop service to delivery SaaS for local stores. During this time, we did hundreds of deliveries ourselves, manned customer support calls till 3 o’clock in the morning, and kept iterating on their software and operations model -- eventually, we became obsessed with solving this problem.

After almost a year, every model that we tried scaling failed. With pressure mounting from our families to focus on academics at Stanford, Aadit and I were on the verge of quitting, until we started an experiment with delivery-focused facilities based on a hunch that this model could facilitate faster delivery times, a better assortment, and fresher products. We were right. The product-market fit with the dark store model was incredible, and it was visible in the data: Month-1 Buyer Retention shot up to 60 per cent+, NPS stabilized in the high 80s, and frequency of usage almost doubled. The opportunity to scale an incredible product and build a generational company was in front of us. So, Aadit and I decided to risk our futures, drop out of Stanford, and start Zepto.

Zepto started as an idea to make online groceries convenient during the lockdown and soon progressed to pioneer a wave of quick commerce in the country. Powered by balanced delivery distances and strong tech capabilities, we managed to make 10-minute grocery deliveries a reality in the country.

Going from 0-100: Investing in growth and learning
We knew that we were competing with legacy companies and that there would be challenges and uncertainties. The odds were stacked against us, but we were determined to make an impact no matter the rocks and mountains we had to climb, or even cross.

As teenage Founders, it was incredibly difficult to convince investors to take us seriously. But eventually, we were able to leverage Zepto’s clear product-market fit to raise $9M (led by Nexus Venture Partners). With capital in hand, Aadit and I took the unconventional decision of hiring a slew of senior executives to form Zepto’s management team on Day 1.

During the pilot stage, Zepto had USD 0 in revenue. We only had a vision and knew that to scale this vision and bring the model to life we needed people who had an experience in building companies from ground zero. Despite having no revenue and being just in the pilot stage at the time, we were able to convince and hire seasoned leaders from some of India’s top consumer internet companies to join our CXO team. This team was critical in building the early systems and processes that helped Zepto scale rapidly. With a phenomenal leadership team in place, Zepto formally launched to the public on the 14 July 2021 - its first serviceable geography was Bandra in Mumbai. The platform started exploding, mainly through word-of-mouth, and the Zepto team started racing to launch new dark stores and new geographies.

On the back of unprecedented growth, Zepto raised 3 more rounds bringing our last valuation to USD 900 Million. Within months of founding Zepto, quick commerce was the fastest-growing category in the consumer internet space in the country and we were the fastest-growing Indian companies of all time.

When venturing into startups with limited knowledge, assembling a team of subject matter experts is crucial. They bring specialised skills and insights that complement your own. By hiring experts, you can tap into their expertise, learn from them, and collectively tackle complex problems.!

We are in it to build a generational company
An entrepreneurial dream needs discipline and focus. Our biggest asset since day 1 was our strength in Unit Economics. Unlike competitors who had massive balance sheets, Zepto had access to a finite amount of capital. This meant perfecting Unit Economics since the early days. This also helped us sustain and grow our business when the public and private markets were under extreme pressure. Our Unit Economics advantage is helping us gain even more market share because we can continue investing in sustainable growth while most high-burn consumer internet companies have been forced to pull back.

Our vision has always extended beyond building a conventional quick commerce startup. We have always strived to establish a transformative institution that distinguishes itself through technological prowess and innovative solutions. We made customer our North Star at Zepto, thereby investing in best of talent, tech and processes to deliver an unparalleled customer experience. As we grow, we are doubling down on resources and pushing the boundaries to leave a lasting imprint and shape the future of quick commerce.

As an entrepreneur, falling in love with the product and building that conviction really just pushes you to see that product through. We saw ourselves as custodians of what would probably end up being a large phenomenon in consumer internet in India and that is what we remind ourselves every day.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

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Magazine 03 June 2023

Kaivalya Vohra

The author is the Co-founder and CTO at Zepto

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