Experience is the best teacher and the worst experience usually teaches the best lesson. This holds true for Indian entrepreneurs Sagar Chandiramani, Jatin Sharma and Monish Chandiramani, founders of Yeepeey – an e-grocery platform in Dubai.
Frustration over their online grocery shopping experience in the UAE – especially delivery charges on smaller purchases and limited grocery options on digital platforms – drove the trio to establish their own start-up.
"It was like hitting against the wall ... there were not many options. Even though it is convenient, consumers still do not like to pay extra mark-ups over and above the price displayed in grocery shops ... [as well as] the exorbitant delivery fee," Mr Sagar, 29, a chartered accountant, tells The National.
“We detected a potential gap in the flourishing e-commerce market and we decided to bridge it through Yeepeey.”
The founders came up with the concept in December 2019, a few months before the coronavirus outbreak that fuelled a surge in demand for online shopping.
However, it would take them 10 months to develop and test the app and mobilise funds before they did a soft launch in November on both the Android and iOS operating systems. It was officially unveiled to the wider public in February.
“It is always easier said than done. Many people suggested to us an earlier launch to capture the new online market created during the Covid-19 pandemic ... but we took our time to ensure that our product is feasible and will not crash if there is huge traffic,” says Monish, 25, who holds a master's degree in business administration with a speciality in finance.
“Moreover, the soft launch allowed us to gather valuable feedback from actual users that helped us to make our offerings more direct by reducing the number of clicks and adding more items to the directory.”
Yeepeey, which claims to offer the same promotions and discounts available in the physical shops, promises delivery within 30 to 45 minutes.
The company allows users to shop from neighbourhood grocers, supermarkets and hypermarkets.
It also collects and delivers items to customers directly and, in some cases, allows orders to be fulfilled by the merchants on their own.
“Our business model is a fine mix of both. These aspects are decided at the time of signing the agreement with the merchant to avoid confusion,” says Mr Sagar.
Yeepeey’s launch also came at an opportune time as e-commerce became more popular after the onset of the Covid-19 pandemic.
The sector will account for more than half of the global retail sector's growth – an expansion of about $1.4 trillion – in the next five years, according to Euromonitor International.
In its January report, Mastercard said up to 30 per cent of the Covid-related surge in e-commerce spending would be a permanent feature in the share of total retail spending in the Middle East and Africa region.
The payments company said 73 per cent of consumers in the region were shopping more online than they did before the pandemic.
Within a short span of three months, Yeepeey now has more than 50 small and big merchants on its platform and serves about 50 districts in Dubai, including Business Bay, Al Barsha, Jumeirah Lakes Towers, Jumeirah Beach Residence, Dubai Silicon Oasis, Downtown Dubai, Bur Dubai, Al Karama, The Greens, The Lakes and Emirates Hills.
The start-up, which allows customers to choose from more than 50,000 items in its grocery catalogue, aims to increase the number of merchants on its platform to 150 by the end of the third quarter of this year.
The founders are keen to expand into Abu Dhabi, Sharjah and other emirates this year but have put regional expansion plans on ice.
“We have dedicated 2021 to the UAE. We will spend time and resources to stabilise our operations and strengthen our base. We will enter Saudi Arabia in the third quarter [of next year],” says Mr Sharma.
“Saudi Arabia is a big market and there is demand for our services ... but we believe in taking small but right steps. We are here to stay for the long-term, so we do not want to clutter things by making rash decisions.”
The company also intends to enter either Bahrain or Kuwait by the end of 2023 or early 2024, says Mr Sharma.
Yeepeey’s founders are long-term residents of Dubai and worked with Ritman, another business-to-business FinTech in the emirate, before setting up their own venture.
Founded with a modest investment of $150,000, Yeepeey is now looking to raise up to $1.5 million from investors in the UAE.
“We are already working on it and it will take few more weeks before we make an official announcement,” says Mr Sagar.
The money will be used to fund marketing activities, hire more staff and optimise the app by adding more user-friendly tools and new shopping verticals such as fresh meat, stationery, flowers, cakes and confectionery.
Yeepeey started operations with only five people but now has 18 employees. The founders hope to have a workforce of 35 by the end of the year.
“We will not have a very large team but we need to hire some industry specialists who are tech-savvy and come with no dearth of ideas," says Mr Sagar. "We prefer developing everything in-house and are not relying on outsourcing for anything.”
The start-up intends to hire talent in areas such as merchant acquisition, sales, marketing and user retention and experience.
The average number of new users registering with the platform every day stands at about 150. The platform also receives about 100 orders every day.
“Thus far, the new users are coming through referrals and our offline and digital marketing. Now, we are getting more aggressive with marketing and we expect the number of daily orders to rise to 500 or 600 a day by the end of this year,” says Mr Sagar.
“Business is surging really fast and daily orders could easily rise to 1,000 a day very soon.”
Yeepeey aims to be profitable by the end of the second quarter of next year and its founders are open to reducing their stake.
“We are open for an exit but not now. We will explore the option when we are established and have proven our ideas ... may be somewhere five years down the line,” says Mr Sharma.
Q&A: Yeepeey’s founders Sagar Chandiramani, Jatin Sharma and Monish Chandiramani
Who is your role model?
Mr Sagar: I do not want to name a specific person but as company, I consider Google as my role model. Despite intense competition in their space, they have created a niche. One cannot survive without using Google … it is the first thing that comes to mind when we are looking for an answer to any problem. We also want to have similar connection with our customers.
Mr Monish: As a company, I look [also] up to Amazon. Their business approach is exemplary. Looking at what they have achieved in the past few years gives us the motivation to move further in the field of e-commerce.
If you could change one thing in your entrepreneurial journey, what would it be?
Mr Sagar: We are quite satisfied with Yeepeey’s journey so far. However, if I look back, in 2009, I made a college project on food delivery named ‘meals on wheels’. Initially I thought of launching it in the market but dropped the plan. That time there was no competition in the food delivery space and it could have been the Google of the industry if I had gone ahead with the plan.
Are you a risk-taker?
Mr Sagar: I do not believe in taking blind risk. The idea is to take calculative risk while keeping all ends covered.
Mr Monish: All three of us come from a financial background so it mitigates chances of taking rash financial decision. We try to take only those risks that we can manage easily.
Did Covid-19 pandemic affect your business?
Mr Sharma: Covid has done damage to the world economy but from a tech perspective, it accelerated the consumers’ and merchants’ acceptance of digital payments. It delayed our soft launch to some extent as there were lockdowns and we had to work from home. But we sailed through it comfortably. In fact, it has given opportunities to many start-ups like us to introduce online services to the market.
Where do you see yourself after 10 years?
Mr Sagar: Yeepeey will be a one-stop shop for all delivery needs … and we will be experimenting with disrupting technologies and business ideas.
Any plans to move your base out of Dubai?
Mr Monish: Dubai is one of the safest and most entrepreneur-friendly cities in the world. This is our home for many years, we have grown up here and this will be our main base of operations. Yes, we have a plan to expand our business to different geographies but we will keep our headquarters in Dubai.