Unpacking Standard Chartered plans to crack B2B e-commerce with Solv

Over the past few years, business to business e-commerce space has come a long way with the public listing of Indiamart and risk capital cornered by Udaan, ShopX, Jumbotail, Max Wholesale among others. While Udaan is a de facto leader in the space with its $1 billion-plus fundraise, Standard Chartered has entered the B2B e-commerce via Solv with a sizable investment.

On the lines of Udaan, Solv wants to lend by simplifying the supply chain and sourcing for small merchants. According to three Entrackr’s sources, the platform has been hiring people to set up operations across the country. “Solv started operations in late 2019, but the pandemic had disrupted its plans. Since the start of this year, it has been recruiting people across north and south India,” said one of the people requesting anonymity.

To streamline operations, Solv has also raised Rs 54 crore recently. According to regulatory filings, Standard Chartered Research & Technology India Private Limited has infused Rs 54 crore in Solv. Since January last year, the company had raised Rs 155 crore across five tranches from Standard Chartered.

Solv connects sellers and buyers across food & FMCG, electronics, mobile phones and apparel with an open marketplace approach. Besides the supply chain, the platform also offers unsecured credit up to Rs 50 lakh. According to its website, Solv has over 50,000 merchants who buy over 250 tonnes of goods from the platform every day. 

“As of now, Solv has largely been prioritising FMCG, grocery and smartphone categories in some parts of Karnataka including Bengaluru. It also has a presence in Hyderabad and Tamil Nadu. It’s doing close to Rs 3 crore worth of transactions every day in the FMCG category in Bengaluru itself,” said one of the people cited above. “It also achieved over Rs 1.5 crore in sales in Hyderabad where it launched three weeks ago.”

Unlike in the southern part of the country, Solv is trying to get a strong foothold in northern India with apparel and food. “It has been raising a team primarily for activating operations in Delhi (NCR), Uttarakhand and Uttar Pradesh. It would go live in major cities of the region with the two fresh categories as it wants to understand how they are different from operational categories,” said the second person who also wished not to be named.

According to sources, the firm is already running a pilot in the NCR region. Responding to Entrackr’s detailed queries sent over email, Solv’s spokesperson said, “SOLV has a presence across 20 plus towns in India & scaled capability to supply 15,000 pin codes within 4 months of commercial launch.” However, the company didn’t answer specific questions on the size of operations, daily sales figure and its strategies.

Looking at Solv’s approach, it appears to be a direct competition to Udaan. Both companies are two-sided (sellers and buyers) full-stack e-commerce platforms where they own every piece of the process right from buying to logistics. They also share the common business model: lending. Standard Chartered sees Solv as an enabler of its credit business among MSMEs. 

Solv had recently launched Buy-Now-Pay-Later (BNPL) with third-party fintech and NBFC platforms to offer instant invoice financing for as low as Rs 3,000 for a period from 15 to 60 days. It aims to disburse Rs 100 crore through BNPL in 2021.

While there are several companies including Nandan Nilekani-backed ShopX, Jumbotail and Max Wholesale which compete with Udaan in a few categories, Solv appears to have a horizontal approach. “Standard Chartered has a deep understanding of credit business and that’s an advantage, but the group has no prior experience of running a technology business,” said Satish Meena, forecast analyst, Forrester India.

“Despite Reliance’s soft entry, Udaan has faced no competition in the horizontal B2B space. Scale wise, it’s way ahead than the combined strength of all others operating in the B2B e-commerce,” added Meena.