Investment in Contlo

Global e-commerce is a massive market. Online retail sales are expected to reach $6.5Tn by 2023, according to eMarketer and Statista. The US D2C (direct-to-consumer) sales have crossed $128Bn in 2021 and are expected to reach $213Bn by 2023.

The pandemic has led to unprecedented growth in digital adoption, shifting consumers’ shopping behaviour to online. We have seen an exponential rise of D2C brands from India post-pandemic. According to the Unicommerce report on India’s retail and e-commerce, D2C brands are driving growth in India’s e-commerce with a 45% CAGR and has the potential to reach $ 70Bn in a few years. According to Statista, India’s D2C market is expected to grow by more than 15 times from 2015 to 2025. In 2020, it was around $33Bn and is forecasted to reach $100Bn by 2025.

Globally e-commerce brands are moving away from marketplaces to headless commerce platforms like Shopify. Shopify is an e-commerce platform which enables merchants to set up online stores and has seen massive growth, doubling the number of merchants using Shopify in the two years from 2019. Shopify ARR was around $5.2Bn in Sep 2022, a 24.5% YoY growth. It was $4.6Bn in 2021, 57.4% YoY growth from 2020.

As brands continue to sell online, they struggle with high marketing spending on CAC and customer retention. They want to build direct relationships with consumers on different channels. To build a long-lasting relationship with the consumer, a consumer needs to be engaged at different points in the journey.

At Kae, we have invested in many D2C brands and keep evaluating more D2C brands in different categories. From all our conversations, customer engagement and high marketing spending came across as common areas of concern. The legacy horizontal marketing tools are not built for e-commerce specific use cases. There is a need for a verticalized marketing automation solution for e-commerce.

We are very bullish on vertical SaaS as a theme and believe the next evolution of customer engagement/marketing automation has to be more personalized. This is exactly where Contlo comes in. It is purpose-built for deep e-commerce use cases via seamless integration with leading e-commerce platforms like Shopify, and Magento. We have been in touch with Ishaan and Mukunda, from their early days and have seen their impressive journey of building an AI-led marketing automation for e-commerce.

Contlo enables e-commerce and D2C brands to accelerate their sales growth, drive revenue generation and automate personalized experiences for its customers using e-commerce centric omnichannel customer engagement across email, SMS, WhatsApp, mobile and web push. It is leveraging AI to build hyper-personalized commerce experiences for end customers.

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Today more than 1000+ brands use Contlo globally. It has witnessed a 50% MoM growth since its inception. It is empowering brands to build direct channels with their consumers, leading to increased retention and LTVs.

Contlo beautifully fits our investing framework for SaaS, leveraging data to build an AI-based vertical SaaS software with a PLG motion.

We at Kae, are thrilled to partner with Ishaan and Mukunda in this journey. They have built a very strong team with a vision to build a world-class AI product. You can find out more about Contlo here.

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