KraveMart raises $6M in new funds

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Quick-commerce startup KraveMart, originally known for promising grocery deliveries within 10 minutes, has raised an additional $6M. This takes their total capital raised so far to $12M. The new round saw participation from Y-Combinator, Keisuke Honda, JAM Fund, Rebel Fund, DeCart Ventures, and Zayn VC, among others.

KraveMart was founded in 2021 by Kassim Shroff, Hammad Bawany, Haziq Ahmed, and Ahsan Kidwai, founders who bring experience from industry giants such as Daraz, Foodpanda, SWVL, and Careem. The extremely competitive quick commerce sector has long faced questions about its long-term prospects due to its unattractive unit economics. In Pakistan, these concerns were actualised in the shutdown of Airlift in 2022, which had, until then, raised $110M.

Despite the sectors broader struggles with margins, KraveMart claims that they’re heading towards EBIDTA-level profitability in the next 8 to 10 months and that its current EBITDA margins are better than many other grocery unicorns in the region. The startup also says that its gross margins stand at 30%, which is a high number for a sector in which margins are notoriously thin.

“From Day 1 it was important for us to start a business that makes money, has real margins, and most importantly makes sure our bottom line is becoming green. We are happy to work with a team of investors who trust our business and growth model, who believe in our region and the role we are playing in redefining the online grocery space in Pakistan,” said Kassim Shroff, co-Founder & CEO, KraveMart.

According to KraveMart, their private-label items, an integral driver towards higher margins, are part of 30% of orders today. They have 150+ SKUs and operate across a range of private-label categories, including spices, lentils and personal care.

KraveMart’s funding round takes total funding in Q4-2023 to $14M (including Retailo’s $1.5M). While this is a huge improvement from the preceding two quarters, it comes off just two big rounds (one of which includes a sizable debt component). Overall, the investment activity during 2023 has remained dismal, in line with the global trends in VC.

Shahzaib Abbasi

Shahzaib Abbasi is an undergraduate student in his final year at LUMS, majoring in Management Science. He is an Analyst at Data Darbar. He has previously worked at Soch Videos as a production intern. He can be reached at [email protected]

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