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Bengaluru-based social e-commerce startup Meesho has raised $3.1 million from investors led by SAIF Partners in a fresh round of funding. Existing investors Y Combinator and Venture Highway also participated in the round.

The startup will use the freshly raised funds to hire for its tech and business operation teams, CEO Vidit Aatrey said. The company is also looking to scale up its platform by bringing in more resellers though community engagement and referrals.

This funding has made startup’s total funding to $3.7 million. In May 2016 Meesho had raised $350,000 from angel investors including in convertible debt.

Founded in 2015 by IIT-Delhi alumni Sanjeev Barnwal and Vidit Aatrey, Meesho is a mobile-first e-commerce platform for the specific needs of small businesses in India. Businesses can create an online shop within seconds, share on WhatsApp and Facebook, keep customers updated with new products, get new customers leads in real-time and collect payments over chat easily.

Meesho connects suppliers to a network of resellers largely comprising housewives, who then use channels such as WhatsApp and social media platforms Facebook and Instagram to promote these products within their social circles. It has about 20,000 resellers and more than 1,000 suppliers on its marketplace, mainly in the categories of fashion, lifestyle and home, and kitchen.

A reseller earns 10-20% commission on each transaction. Mukul Arora, managing director at SAIF Partners said to Times of India, “This is a very India specific opportunity with strong tailwinds, and has potential to change how long tail products are sold in India.”

Meesho has partnered with third party logistics players to enable deliveries. About half of its orders are fulfilled through cash on delivery, 25% through payment gateways, for which it has tied up with Razorpay, while the rest are done through mobile wallets.

WhatsApp is estimated to have over 100 million users. As the country’s most popular app, WhatsApp is unparalleled as a distribution channel for selling online or retaining customers, despite being largely ill-suited to the role. That’s where Meesho, a startup in Y Combinator’s latest batch, is hoping to change things and empower WhatsApp sellers.

The number of Internet users in India is expected to reach 450-465 million by June, up 4-8% from 432 million in December 2016. The report also points out that 77% of urban users and 92% of rural users consider mobile as the primary device for accessing the Internet, largely driven by availability and affordability of smartphones.

Moreover, in India not everyone has desktop or laptop but smartphone with WhatsApp as the most popular app which is estimated to have over 100 million users. As the country’s most popular app, WhatsApp is unparalleled as a distribution channel for selling online or retaining customers, despite being largely ill-suited to the role. That’s where Meesho is hoping to change things and empower WhatsApp sellers.

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