Understanding Udaan and the challenge of B2B e-commerce

The scale of Udaan’s funding-fuelled growth is unmatched in the B2B space. We dive into the concerns and a potential path to profit.

Saif Iqbal

Toronto

02 June 2020

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While online retail companies—Flipkart-Myntra, Amazon, BigBasket, JioMart, etc.—fight flashy battles over the relatively small consumer e-commerce market, the past few years have seen investor interest surge in B2B, or business-to-business, e-commerce. The market size touted is huge—usually upwards of $600 billion in trade between brands, wholesalers and retailers. And the biggest bet by far in B2B e-commerce is Udaan.

When three ex-Flipkart executives launched the B2B e-commerce marketplace Udaan four years ago, they wanted to go beyond the listings/classifieds model, where the marketplace earns revenue only for generating leads. Say, like an Indiamart.

There were four key operational and business ideas that shaped how Udaan grew, and drove investors to pump in close to a billion dollars over the years:

There was a gap in the B2B e-commerce space in terms of managing selection, pricing and market making (matching sellers with buyers) by category

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