This two-year old startup is helping new-age social media stores grow their businesses

In the burgeoning world of online entrepreneurship, particularly in the realm of social media, small business owners like Vitsi Vitseivono face a common set of challenges. 

While platforms like Instagram offer a vast audience and a visually appealing medium to showcase products, they are not inherently designed for commercial activities. 

This mismatch leads to operational difficulties for entrepreneurs who are often single-handedly managing various aspects of their business, from payment collection and shipping to customer support. 

The complexity and time-consuming nature of these tasks can be overwhelming, especially for those running their business single-handedly. This operational struggle is a widespread issue, as highlighted by a Deloitte survey, which found that 63% of millennials and Gen Z aspire to start their own businesses and achieve financial independence. 

However, the lack of integrated commercial tools on social media platforms presents a significant barrier. Entrepreneurs find themselves juggling multiple roles, leading to inefficiencies and missed opportunities for growth. 

The challenge is not just in managing the day-to-day operations but also in expanding the business's reach and improving customer engagement. Traditional social media platforms, while excellent for visibility, fall short in providing the necessary tools for effective business management and growth. 

How did it start?

To fill this gap, Rahul Gope and Anjan Kumar Patel, who both studied together at IIT Bombay and later pursued their individual professional paths, founded Oyela in 2021.

Gope's personal experience as an entrepreneur played a pivotal role in shaping Oyela's mission. He had previously run an online pearl boutique in the Andaman Islands with his parents. 

However, despite his efforts, Gope faced challenges in terms of gaining visibility and managing operations, which eventually led to the closure of his business. The experience left him feeling more like a bystander in his entrepreneurial journey rather than the driving force. The personal setback, combined with the growing trend of creative entrepreneurship in India, led Gope to realise that the difficulties he encountered were not unique to him but were likely shared by many others in the entrepreneurial community. 

The realisation was the catalyst for starting Oyela. The primary aim of Oyela is to transform social media platforms into powerful sales channels for small-scale businesses. 

Gope recognised that many small business owners struggle with similar issues of visibility and operational efficiency when trying to sell products through social media. 

The startup's approach is to provide these small-scale businesses with the necessary tools and support to overcome these challenges. The platform focuses on helping sellers in the short term and building and strengthening their supply chains over time. 

This empowers sellers, enabling them to manage their operations more effectively and grow their businesses sustainably. By addressing the common barriers faced by small business owners, Oyela aims to unlock the potential of social media as a robust and effective platform for sales and business growth.

“The inspiration behind Oyela is deeply personal. Hailing from the Andaman Islands, I once ran an online pearl boutique. Ultimately, my venture died down due to lack of discovery and operational barriers. Seeing the explosion of creative entrepreneurship in India, I recognised that these challenges could resonate with aspiring entrepreneurs. Oyela was born from this vision, aiming to provide others with the tools and opportunities I wish I had during my entrepreneurial journey,” Rahul Gope, co-founder, CEO, Oyela, said.

What does Oyela offer?

The startup emerged as a game-changer for small business owners who primarily operate on social media platforms. It has developed an online platform to transform the way businesses function by offering a suite of tools and resources that streamline operations and foster growth. 

For entrepreneurs like Vitsi Vitseivono, who initially struggled with the multifaceted demands of running an online store, Oyela automated various aspects of her business, from order processing to customer interactions. 

It enabled her to focus on product curation and presentation. This shift in focus led to a significant increase in her sales, jumping from 200 to over 3,000 products sold monthly. 

Oyela stands out with its unique offerings that cater specifically to the needs of small businesses. The platform assists these businesses in setting up and managing their digital storefronts, providing essential tools for collaboration and operation streamlining. 

One of the key features of Oyela is its collaboration tech tool, which allows stores to partner and gain visibility through mutual endorsements. This feature is particularly beneficial for their reach and customer base. 

Additionally, Oyela integrates social media automation, particularly with Instagram, to enhance the efficiency of product promotion and customer engagement. This automation includes exporting products as Instagram posts, streamlining interactions through direct messages, stories, and comments, and simplifying the order collection process. 

This integration saves time and ensures a consistent and engaging presence on social media, which is crucial for online businesses. 

Another significant aspect of Oyela is its AI system, which is designed to ensure the authenticity and reliability of transactions on the platform. This system scrutinises various behavioural and sales parameters to identify and prevent fraudulent activities, safeguarding both the sellers and the buyers. 

By analysing data from thousands of transactions, Oyela has successfully minimised returns and refunds, leading to more stable and increased sales for the sellers on its platform. This focus on trust and reliability is a cornerstone of Oyela's approach, ensuring a secure and fruitful environment for small businesses to thrive in the competitive world of social commerce.

Funding and investors 

In October 2023, Oyela raised Rs 14.4 crore in funding from an early-stage venture capital fund, Prime Venture Partners. 

The startup earlier said it aims to use the raised capital to develop ecommerce technology, build chatbots for selling on various platforms with public profiles like Pinterest, YouTube, Threads, as well as streamline the supply chain to help people set up and expand their own Instagram stores.

“The GenZ population are e-commerce natives and are also open to experimenting with fashion. Currently, there are more than 200M businesses/sellers on Instagram globally. The next 10 years of e-commerce growth will have a meaningful contribution from these Gen Z sellers. Oyela provides solutions to streamline and automate their social-media led commerce business. We are impressed by the team at Oyela and we believe they are on the brink of transforming the social commerce landscape in India,” Amit Somani, Managing Partner, Prime Venture Partners, said.

Focused on growth

Oyela claims to have witnessed more than 20,000 Instagram-based stores joining its platform. Notably, the startup said that this growth has been organic, meaning these stores have joined without any direct marketing or acquisition efforts from Oyela.

Interestingly, Many of these stores have reported a substantial increase in order volumes, with some seeing up to 2.5 times more orders. Currently, the platform has over 25,000 sellers actively using it.

Over the next five years, Oyela aims to empower and establish two million social stores. By doing so, it hopes to capture a significant portion of India's ecommerce and social commerce markets, specifically targeting 1.6% of the ecommerce market and 9.5% of the social commerce market.

The startup also expects to achieve a Gross Merchandise Value (GMV) of $3 million and revenue of $300,000 in FY24. 

In the broader market, Oyela faces competition from various players. It competes with platforms like ETSY and Swiggy Minis, which cater to different segments of the market. While Software as a Service (SaaS) solutions like Dukaan focus on operational aspects, larger marketplaces like Meesho and Amazon are more suited to bigger sellers. This market dynamic leads many small businesses to turn to social media platforms like Instagram to gain product visibility.

The current landscape of the social and content commerce market in India

According to a Bain & Capital report, The social and content commerce market in India is expected to grow significantly, with projections indicating it could reach $70 billion by 2030. 

The growth is driven by the increasing trend of small and medium businesses using social media channels for sales. According to Gope, there are currently over 200 million businesses and sellers on Instagram globally, and he anticipates that the next decade of ecommerce growth will see substantial contributions from Gen Z sellers.

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