The strict lockdowns on lifestyle and businesses has affected the economy and specially those startups severely during this COVID-19 period, Instamojo, a digital platform which allows traders and businesses to sell products through the web while accepting payments through the same, has emerged out to have gained huge profits amidst the chaos.
The Bengaluru-based startup’s boss Sampad Swain reported that it has enrolled a development in net benefit in April, which is 20% higher than the earlier month. While the figure stood some place at 37% in December 2019, the gross margin was declared at 57% in the moth of April, this year by the company officials. Also, its net burn was reduced to 50% in April which was remarkably the lowest ever for the company in a month.
The prime reason that can be supported is the availability of merchants online. Despite the lockdown, Instamojo was able to acquire 1,500 merchants on a daily basis without advertising, the mode being digital-only as tweeted by Swain. The activation rate has grown by 100% from the pre-lockdown time. It was in February that Instamojo had also ventured into the social commerce segment through the reseller model.
For the Kalaari-backed firm, the acquisition of GetMeAShop (GMAS) seemed to have a rather positive impact on overall business. It has helped MSMEs to create and operate online stores and offer third party infrastructures such as logistics, CRM, and mobile apps. Swain claimed that it has around $100K plus merchants subscribed for premium services.
Amongst those who were hit by this lockdown are from the travel and entertainment sector and form 60% of total merchants, as told by Swain to the media. While those who have shown a rise upto five times are B2B businesses, education, and freelancers providing services.
The B2B e-commerce enabler has also recorded the highest online store GMV, revenues and gross profit at 69%, 64%, and 47% respectively in April. During the period, Instamojo claims to have recorded the highest Net Promoter Score (NPS) of 44.