Business-to-business e-commerce platform ElasticRun cut its losses by about half in the financial year ended March 2024, as a shift in focus to regional brands improved margins.
The Pune-based startup, which counts Softbank, Goldman Sachs, Prosus Ventures, Norwest Venture Partners, Kalaari Capital among its backers, Monday said its losses narrowed to Rs 350 crore in FY24. The company incurred a loss of Rs 618.82 crore in FY23 on a revenue of Rs 4,754.86 crore, as per data from VCCEdge.
The startup did not disclose full details of its financial performance in FY24, including revenue and expenses.
ElasticRun, which runs a B2B platform connecting brands to Kirana stores in rural India, has been incurring losses in the past few years. A major factor behind the improved financials in FY24 is the strategic pivot to distributing products of what the company calls "high-margin regional brands" and focus on right-sizing the cost of operations. This changed ElasticRun's sales mix, with over 90% of sales now coming from these high-margin products, it said.
ElasticRun said its improved product portfolio and three-fold increase in take rates in the financial year have boosted gross margins "significantly". However, gross merchandise value (GMV) declined in FY24, the company said, without providing by how much.
"We strategically realigned our platform to focus on high-margin regional brands, and this shift has worked exceptionally well for us," said Sandeep Deshmukh, co-founder and CEO at ElasticRun.
The company's private-label business also recorded strong growth and now contributes nearly 20% to its total sales.
Operated by NTex Transportation Services Pvt Ltd, the company attained the status of a unicorn in 2022 after raising $300 million in a funding round led by Softbank, Goldman Sachs, and Prosus Ventures, which valued the company at $1.5 billion at the time.
It was founded in 2016 by Sandeep Deshmukh, Shitiz Bansal and Saurabh Nigam.
