Bizongo co-founder (from left) Sachin Agrawal, Aniket Deb and Ankit Tomar
Anirudh Mane’s packaging solutions start-up was still in initial stages. Along with a few friends from design school, he had managed to set up a small company that manufactured tailor-made packaging solutions for niche retail businesses. However, he was having trouble discovering prospective clients who would recognise his value addition and not see the company as a bubble-wrap and corrugated box manufacturer.
Then he stumbled upon Bizongo, a B2B marketplace that helps connect solution providers like Mane with large retailers who have specific packaging needs. Bizongo also helped him improve his designs with its in-house team of design engineers.
Bizongo essentially helps businesses design, develop and procure packaging products.
The three-year-old start-up by IIT graduates Aniket Deb, Ankit Tomar and Sachin Agrawal offers packaging solutions for everything — from retail to FMCG to hospitality and medical and pharmaceutical industry. Bizongo recently raised $22 million series B funding from Eduardo Saverin’s B Capital, International Finance Corporation and existing investors Accel Partners and IDG Ventures.
“Finding the right solution in India’s $40-billion packaging market with over 30,000 vendors is time-consuming. Bizongo makes the process easy by leveraging an in-house design studio, a curated marketplace of over 200 manufacturers and an innovative supply chain technology,” said Kabir Narang, partner and co-lead for Asia investments at B Capital.
Ranjith Menon, executive director of IDG Ventures-India, said: “Packaging has become mainstream. This is a fragmented market, both on the supply as well as the demand side. Technology that can bring about efficiency not just in the discovery process but all constituents of the supply chain is what got us excited about Bizongo.”
The current round takes Bizongo’s total funding to $25 million, including the $3 million it raised last November.
The company currently operates across Mumbai, Bengaluru and Delhi regions. Bizongo caters for e-commerce majors like FirstCry and Myntra and retail giant Future Group. “We debated about different domains for our start-up till we stumbled upon the need for packaging solutions in the B2B space. We spent a lot of time at tradeshows to understand the challenges SMEs faced in purchasing- and selling efficiency-related issues on this front,” said Deb.
Given the rise of e-commerce platforms like Flipkart and Amazon, the market is abundant with retailers looking for technology-based packaging solutions. Bizongo wanted to go beyond just connecting buyers and sellers and offer more customised solutions instead.
The company deals with buyers across sectors having an average annual turnover of Rs 1 billion and more, said Deb. Sellers, on the other hand, are much smaller enterprises and are mostly dependent on tradeshows to help them garner business of around Rs 200-250 million turnover.
Bizongo helps customers define their packaging solution requirement and then find sellers who can meet the need based on material, region and price quotes. The company earns commissions from sellers for successful deals.
The company is operationally profitable. It has grown from Rs 500,000 to Rs 100 million in revenues per month since inception.
Plastic bans across the country may be the main concern for a packaging material supplier, but Deb doesn’t see issues in this regard. “Whenever there is a dearth of plastic options in the market, people start looking for alternatives. Businesses immediately look for biodegradable options, especially in F&B sectors,” Deb said.
Bizongo endorses sustainable packaging and offers in-house sustainable packaging solutions. Convincing businesses and investors the margin possibility and value-creation of the business have been the biggest hurdle for Bizongo. However, the company’s performance has so far helped it tide over this concern.
The company is specific about hiring people with domain expertise in packaging development and product designing, which will be a key area for investing the recent round of funding. It is keen on spreading its regional presence beyond three cities.
Expert Take: Need to build new capabilities
Debabrata Deb Director, Future Formats, a packaging consultancy
Packaging involves customisation based on a product and its brand positioning. Bizongo's solutions cover design, structure, shape, brand presence, sustainability, development, cost-effectiveness and robust analytics. It has created new servicing paradigms in doorstep delivery.
Widespread technology adoption is helping. The growing supplier base is adding flexibility. But it needs to build new capabilities and address these challenges:
Large-scale FMCG packaging is taken care of by large converters, but how will the Bizongo team get its ideas through to these converters? How will Bizongo assure quality as the business grows?
Time to market is a key parameter for success. The role of basic raw material suppliers is critical, and the firm needs to track the price, quality and availability of these inputs. It has to also figure out how it will induct latest generation raw materials and technologies such as printed electronics.