Nikhil KamathEp #3| WTF is E-commerce: Kishore Biyani, Udaan & Meesho Founders Reveal What Sells and What Doesn’t
CHAPTERS
Playful cold open and setting the tone for “WTF is E-commerce”
The episode kicks off with banter about punctuality and meeting Vidit “at an airport burger shop,” quickly establishing a casual, insider tone. Nikhil frames the session as a candid discussion about commerce (not just e-commerce) with founders/operators who’ve seen multiple cycles.
- •Light banter about late arrivals and “don’t put this in the podcast” energy
- •Nikhil’s intent: quick personal intros from each guest, then deeper intersections
- •Theme setup: commerce as behavior + distribution, not only online transactions
Vidit Aatrey’s origin story: from farming family to building Meesho
Vidit shares his background in Rohini/Meerut roots, a farming family, and the narrow career expectations he grew up with. He describes early discomfort-driven learning (ITC operations in Chennai) and how Bengaluru’s startup ecosystem pushed him toward entrepreneurship.
- •First engineer in a farming family; mindset shift at IIT Delhi
- •Early career in operations at ITC; language/culture discomfort as growth
- •Move to Bengaluru; entrepreneurial “bug” and founding Meesho in 2015
What Meesho is: bringing India’s long-tail sellers online
Vidit explains Meesho’s original mission: move India’s unbranded, long-tail small businesses online in a way that fits Indian retail realities. He shares scale metrics and highlights Meesho’s focus on affordability and selection for value-conscious consumers.
- •2015 insight: e-commerce was skewed to smartphones/white goods, not “India retail”
- •Target: 85%+ of Indian retail in long-tail/offline small businesses
- •Scale snapshot: ~140M annual buyers, ~1M small businesses, ~1B orders/year, AOV ~₹320
- •Value proposition: maximum selection at affordable price points
Kishore Biyani’s early journey: contrarian instincts and building categories
Kishore recounts his conservative upbringing, atheism, and contrarian approach—choosing not to simply inherit the family fabric trade. He describes experimenting with textiles, riding the shift from tailor-made to ready-made clothing, and expanding into multiple consumer businesses.
- •Rebellion and “shortage era” as a driver of ambition and creativity
- •Started with fabric → stonewash/denim trends → brand-building
- •Expanded into retail formats, logistics, finance/insurance, and investing
- •Emphasis on continuously “destroying old thoughts” to create new models
How Big Bazaar happened: learning from bazaars, Tirupati crowds, and Saravana Stores
Kishore explains the insight behind building a “marketplace-like” retail experience in cities—hustle, crowd, and energy as a feature. He shares unconventional inspirations like Tirupati’s crowd management and Chennai’s Saravana Stores as a prototype for scale retailing.
- •Big Bazaar modeled on haats/bazaars: “crowd attracts crowd”
- •Opened multiple stores rapidly to create scale and momentum
- •Tirupati as a case study in queue/crowd operations (water, patience, flow)
- •Saravana Stores inspiration: everything under one roof, high-volume categories
Sujeet Kumar’s story: Bihar → IIT → Flipkart early days → Udaan
Sujeet traces his path from Hindi-medium schooling in Bhagal (Bihar) to IIT Delhi, early entrepreneurship, and then joining Flipkart when it was tiny. He details building supply chain and Ekart, then leaving to co-found Udaan.
- •IIT exposure changed worldview; early entrepreneurial attempt via KPO
- •Joined Flipkart around 2008; early orders were single digits/day
- •Early infrastructure gaps: payment gateway challenges; proprietorship structure
- •Built core ops/supply chain; founded Ekart (2010)
- •Left in 2016; co-founded Udaan with Flipkart/IIT network
Angel investing and the “real economy” detour: QSR, coffee, and Rameshwaram Cafe numbers
The conversation moves from tech to profitable offline businesses, with Sujeet describing his broad angel portfolio and growing interest in food/QSR. Rameshwaram Cafe becomes a case study in extreme throughput and margins, sparking a debate on why great businesses often refuse to scale.
- •Sujeet’s angel portfolio (~150 investments) and a few big winners
- •Shift toward profitable consumer businesses: coffee (Third Wave) and QSR
- •Rameshwaram Cafe: ~7,500 bills/day; ~₹4.5–5Cr/month/store; high gross margins
- •Observation: many high-quality restaurant operators don’t want external capital/scale
- •Reasons: fear of quality dilution, operational headaches, preference for control
Copy-paste models vs India-first value creation: brands, not commodities
Kishore argues that India’s prosperity requires value addition—especially via brands—rather than commodity resale or direct copying of Western models. The group discusses Indian brands that scaled and why brand-building is hard but crucial.
- •Localization is mandatory; exact copy-paste rarely works in India
- •Value addition lens: “brand banana” creates the most economic value
- •Examples of Indian/India-built brands: Amul, Parle, Marico, ITC; new-age: boAt, Mamaearth (and others emerging)
- •Digital influence is now inseparable from commerce (even for offline purchase decisions)
What makes people buy: aspirations, FOMO, and influencer-led demand shaping
Vidit and Sujeet break down modern purchase behavior: social media drives discovery, imitation, and aspiration, with FOMO as a key emotional engine. Influencers are increasingly decentralized—micro-influencers can outperform celebrities because trust and relatability are higher.
- •Meesho users often search using Instagram images; social influences trends and catalog decisions
- •Influencer landscape is decentralized: “body-double” relatability matters
- •Marketing is shifting from mass advertising to cohort-based identity matching
- •Micro-influencers can be more effective than celebrities due to authenticity and fit
- •Platforms (Instagram etc.) are building creator funds to sustain influencer economics
Meesho marketing strategy: hyper-local celebrity selection and ROI ambiguity
Vidit explains why Meesho prioritizes localization over one national celebrity—India’s heterogeneity makes uniform messaging inefficient. They discuss the difficulty of clean ROI measurement in brand marketing and why rotating faces reduces brand-risk concentration.
- •Localization by region/state using culturally resonant celebrities
- •Diwali campaign example: different celebs by geography (e.g., Sourav Ganguly, Ram Charan)
- •Avoiding over-attachment to one celebrity as a reputational risk hedge
- •Marketing attribution remains largely anecdotal; ROI is hard to isolate
“Three Indias” and microeconomies: why market-size predictions often fail
Kishore presents his framework of India One (consuming class), India Two (serving class), and India Three (farm labor/aid-dependent segments), arguing that many market forecasts ignore structural constraints. He highlights “temple economy” and event-driven consumption (harvest, festivals, weddings) as core demand engines.
- •India One ~11–13% (approx. ~20Cr): the discretionary consuming class
- •India Two serves India One; India Three remains largely constrained in discretionary spend
- •Temple economy as massive employment + consumption micro-ecosystem
- •Event-based consumption cycles: harvest → weddings → big-ticket buying
- •Skepticism toward linear e-commerce user forecasts without value addition and income lift
Why products sell (and don’t): needs vs wants, vanity, and channel shifts
Kishore frames selling as fulfilling daily/occasional needs and wants, plus vanity/ego for premium categories. Vidit adds that channel changes (offline to online, then new tech like AI) alter what consumers prioritize—touch/feel disappears, price and visuals rise, and discovery becomes social-led.
- •Product-market fit across: daily need/want vs occasional need/want
- •Premium demand: vanity/ego fulfillment
- •Channel shift changes decision drivers (touch/feel → images/pricing/merchandising)
- •OTT example as an analogy: format change reshapes demand patterns
- •Aspirations increasingly dominate discretionary buying, including India Two cohorts
Platform differentiation, Amazon vs Flipkart vs Meesho, and the multiplex detour
The group explores how marketplaces differentiate when everyone can sell “everything,” emphasizing brand value propositions like convenience vs affordability/selection. Nikhil shares his evolving view on multiplexes, while Kishore argues discretionary spend is migrating to restaurants and social experiences.
- •Amazon’s perceived core: convenience/speed; Meesho: affordability + selection at low price points
- •Flipkart’s legacy DNA: value-for-Indian-consumers (COD, logistics, pricing levers)
- •Question raised: as catalogs converge, platforms win via value prop and trust/experience
- •Nikhil’s multiplex thesis: low screen density supports cinemas, but OTT pressure persists
- •Kishore’s counterpoint: spend shifts from cinema to restaurants/social hangouts
ONDC explained: the “UPI of e-commerce” and why its implications are unclear
Vidit explains ONDC as an interoperability layer intended to help India’s massive base of small businesses go online by unbundling the value chain. The panel debates whether it increases consumption or merely reshuffles distribution, and whether marketplaces can remain differentiated if supply becomes commoditized.
- •ONDC goal: interoperable catalogs across buyer/seller apps (like UPI for commerce)
- •India has ~60M small businesses; only ~1–1.5M sell online today
- •Key open questions: branding/differentiation, logistics variance, customer experience control
- •Debate: demand vs supply—does ONDC create new consumption or just new access?
- •Consensus: vision is strong, but still early; outcomes uncertain
Nykaa and investing in Indian e-commerce: vertical winners, TAM expansion, and what’s next
Nikhil asks how investors should evaluate Nykaa as a rare listed “e-commerce” proxy in India. The group positions Nykaa as a strong vertical brand/content-to-commerce play, but not representative of broad e-commerce; its challenge is expanding TAM via adjacencies without losing focus.
- •Nykaa framed as a brand + vertical commerce, not a horizontal marketplace proxy
- •Strengths: category timing (beauty growth), content-to-commerce, exclusive/curated supply
- •Risks: rising competition, adjacency execution complexity (fashion, B2B experiments)
- •Listed-market gap: few direct plays; future IPOs may be vertical specialists (e.g., kids/baby retail like FirstCry)
Getting into e-commerce + Kishore’s founder advice: debt, balance sheets, and fatal flaws
The episode closes with pragmatic advice: e-commerce is unavoidable, but winners build value addition, strong unit economics at the right stage, and real differentiation. Kishore reflects on mistakes—especially debt-fueled growth—and introduces the idea of entrepreneurs identifying their “fatal flaw” through introspection and feedback loops.
- •Practical entry paths: D2C, niche brands, online-native sellers; not everyone must build a platform
- •Profitability timing debate: reach critical mass first, then enforce discipline and profitability
- •Kishore’s major regret: scaling on debt without a strong balance sheet
- •“Fatal flaw” concept (from Shakespeare): founders must identify and work on core weaknesses
- •Tools suggested: psychology/history/mythology, dissent-friendly teams, non-echo-chamber circles
