Last Saturday, Manoj Gupta, an associate with Nexus Venture Partners, quit the firm to take the entrepreneurial route. Gupta is building a online luxury brand in handicrafts called Craftsvilla. The company, based in Mumbai, designs, produces and markets its own products apart from selling other premium brands. Craftsvilla is also currently in talks with Nexus to raise a round of funding. Gupta talks about his plans for Craftsvilla in an email interview with Startupcentral. Edited excerpts:
What inspired you to turn to entrepreneurship?
I have always been an entrepreneur at heart. Even when I joined Nexus, it was sort of entrepreneurship since the firm had just started up. The combination of multiple things given my personal ambitions, the untapped opportunity in handicrafts and how ecommerce was shaping up in India led me to jump into this.
How long have you been incubating the idea for Craftsvilla? Has handicrafts always been an area of interest?
I have been looking at the handicrafts category for over a year now and strongly feel that there is a big white space to create a strong online brand. This is a difficult category and would require flawless execution. After assessing the opportunity bottom-up I decided to take the plunge to realize this multi-billion dollar opportunity. This was sort of a completely different area for me given that I had started a technology company in US before. But I believe that if you have strong conviction, passion and can create a good team around you, you can execute in most sectors.
What does Craftsvilla do differently from similar businesses/ competitors, offline and online?
We are doing differently in multiple aspects. First, we have the largest collection of handicrafts you will find online. This range is attracting customers. We can do that because we have invested more than a year in getting the right suppliers. Second, we have maniacal focus on customer service and customer delight which we do by delivering the products very fast and by responding to customer queries quickly. Also we have free shipping, free return and a 30-day return policy which are unheard of in India. Third, we are giving customers high quality but not necessarily high priced products in handicrafts which is building lot of trust in customers.
How will the business make money?
The handicrafts category has very good margins and this is one of the best categories in my mind from the ecommerce angle. The primary business model is to sell directly to consumers online but we are also contemplating online wholesale and corporate gifting too.
How are you funding the venture? Will you look at venture capital funding at some point?
Currently I am seed funding the company with my own funds. Yes, I will be looking for funding soon from venture capitalists.
What are the one-year targets for Craftsvilla in terms of revenues and customer base?
I want to have more than one lakh products on my webstore within the next 12 months with more than 1,000 orders per day by March 2012. The revenue run-rate in March 2012 will be close to Rs 30-40 crore per year.
What are the three most important lessons you have learnt as a venture capitalist?
The importance of a good team, challenges of scaling and doing businesses in India and sustainability of businesses irrespective of downturns.
Nexus also offers incubator-type opportunities to startups. Are you taking advantage of that facility?
Yes, Nexus is very entrepreneur friendly fund and I am talking to them.
What are the three things that you look forward to most as an entrepreneur, which is not available in a VC job?
Getting operating experience including selling yourself to your customers and vendors, understanding in minute detail the challenges of executing a business and dealing with a wide variety of people right from bottom layer to top layer.