The crisis and a locked room

Hari Menon recalls the exact moment the grocery game changed in India.

“When Grofers got announced with investments from SoftBank and Tiger Global. The two investors who, when they [invest in a company], literally [no other investor matters], right?” he says, adding, “And here we were, doing reasonably well, achieved our early goals,  got our convenience factor right, blah blah blah. It was a huge amount of money.” Menon is the co-founder and CEO of India’s leading online grocer, BigBasket.

The time period Menon is referring to is 2015. BigBasket was then a 4-year-old startup that had raised close to $90 million in funding and was seen as the market leader. Until Grofers, a new type of grocery startup, came along. Started just a year prior, the startup raised three back-to-back venture capital rounds in 2015, adding up to $165 million. Its leading investors were the scary trifecta of Tiger Global, Sequoia and SoftBank. 

Grofers promised to deliver orders in less than 90 minutes, usually by picking up the products customers wanted from nearby retail stores. It was what they called “hyperlocal.” In comparison, BigBasket often took 24 hours to deliver orders from their own warehouses.

Q: How did you cope with the big Grofers announcement?

“What do you do? Our board meeting was coming up in a few days, and this announcement just broke. But because we understand the space so well we had just this single belief, that if you don’t make gross margins of 23%, you can’t make this business work. 

“The highest cost is the cost of delivery, and runs anywhere between 7-7.5% of sales in e-commerce grocery when you’re doing well. That’s the number you’ve got to hit. But models like this run at 12-13% of sales. How do you make this business work when the retailer you’re buying from is not going to give you anything more than 5-6% as your gross? So we locked ourselves in the boardroom and sat for about 6-7 hours and said, “Let’s think. If someone’s putting so much money behind it, there’s got to be something behind it. But we are not getting it. And till we get it, we would stay there.”

“We didn’t get it. We didn’t get it for days. We tried everything that might work, tried all possible models. Will they deliver using cycles, walking, get Kirana stores to deliver? We discussed all the pros and cons. 

“At the end of 3-4 days, we said: “stay put.” We called the team into a room and spent 2-3 hours giving them our logic. We had unanimous – absolute unanimous support.


Rohin Dharmakumar

Rohin is co-founder and CEO at The Ken. He holds an MBA from the Indian Institute of Management, Calcutta and an engineering degree in Computer Sciences from the R.V.C.E., Bangalore.

View Full Profile

Available exclusively to subscribers of The Ken India

This story is a part of The Ken India edition. Subscribe. Questions?


Annual Subscription

12-month access to 200+ stories, archive of 800+ stories from our India edition. Plus our premium newsletters, Beyond The First Order and The Nutgraf worth Rs. 99/month or $2/month each for free.

Rs. 2,750


Quarterly Subscription

3-month access to 60+ new stories with 3-months worth of archives from our India edition. Plus our premium newsletters, Beyond The First Order and The Nutgraf worth Rs. 99/month or $2/month each for free.

Rs. 1,750


Single Story

Instant access to this story for a year along with comment privileges.

Rs. 500


Annual Subscription

12-month access to 150+ stories from Southeast Asia.

$ 120


Quarterly Subscription

3-month access to 35+ stories from Southeast Asia.

$ 50


Single Story

Instant access to this story for a year along with comment privileges.

$ 20



What is The Ken?

The Ken is a subscription-only business journalism website and app that provides coverage across two editions - India and Southeast Asia.

What kind of stories do you write?

We publish sharp, original and reported stories on technology, business and healthcare. Our stories are forward-looking, analytical and directional — supported by data, visualisations and infographics.

We use language and narrative that is accessible to even lay readers. And we optimise for quality over quantity, every single time.

What do I get if I subscribe?

For subscribers of the India edition, we publish a new story every weekday, a premium daily newsletter, Beyond The First Order and a weekly newsletter - The Nutgraf.

For subscribers of the Southeast Asia edition, we publish a new story three days a week and a weekly newsletter, Strait Up.

The annual subscription will get you complete, exclusive access to our archive of previously published stories for your edition, along with access to our subscriber-only mobile apps, our premium comment sections, our newsletter archives and several other gifts and benefits.

Do I need to pay separately for your premium newsletters?

Nope. Paid, premium subscribers of The Ken get our newsletters delivered for free.

Does a subscription to the India edition grant me access to Southeast Asia stories? Or vice-versa?

Afraid not. Each edition is separate with its own subscription plan. The India edition publishes stories focused on India. The Southeast Asia edition is focused on Southeast Asia. We may occasionally cross-publish stories from one edition to the other.

Do you offer an all-access joint subscription for both editions?

Not yet. If you’d like to access both editions, you’ll have to purchase two subscriptions separately - one for India and the other for Southeast Asia.

Do you offer any discounts?

No. We have a zero discounts policy.

Is there a free trial I can opt for?

We don’t offer any trials, but you can sign up for a free account which will give you access to the weekly free story, our archive of free stories and summaries of the paid stories. You can stay on the free account as long as you’d like.

Do you offer refunds?

We allow you to sample our journalism for free before signing up, and after you do, we stand by its quality. But we do not offer refunds.

I am facing some trouble purchasing a subscription. What can I do?

Please write to us at detailing the error or queries.