Once (and future?) unicorn.

There was a time not that long ago when Snapdeal was the proverbial poster-boy of not just Indian e-commerce but of Indian startups in general. The pioneer in the e-commerce marketplace model, Snapdeal attracted nearly $2 billion in funding from blue-chip investors such as SoftBank, eBay, Bessemer, Nexus and Ontario Pension Fund. It was destined for great things, beyond the token startup unicorn tag.

But in the aftermath of its failed shotgun marriage to Flipkart, Snapdeal seemingly fell off the map—a forgotten startup relic that had no relevance or meaning in a new world dominated by the Walmart/Flipkart-Amazon duopoly.

Until now.

Kunal Bahl.

Comeback kid.

Startup hero.

A leading media house recently anointed the Snapdeal founders, Kunal Bahl and Rohit Bansal, as “comeback kids” in their startup awards show—an award that purportedly recognised the tenacity of Snapdeal to emerge as “one of the biggest survival stories of the Indian startup ecosystem in recent memory.” 

The source of this optimism?

A company blog post by Kunal Bahl, where he claimed that “in the recently concluded financial year, FY 2018-19, Snapdeal grew its consolidated revenues by 73% YoY, while simultaneously reducing loss by 70% YoY and revenue from operations for Snapdeal (standalone) grew by 87% YoY”.

Snapdeal’s purported financial performance (Source: Company blog post)

Bahl also claimed that “over the last two years, we have reduced our loss by an incredible 96%” and that Snapdeal became the first large-scale e-commerce company in India to achieve the cash-profit milestone by cash break-even in the month of June 2018. In another post, Bahl claimed that in July 2018, the company cut down on “cash burn by 100%, and made the highest-ever net revenue in its history in October 2018”.

While these averments might be sufficient to convince credulous media people looking to issue big-bang headlines and dole out startup awards, the proof of the pudding is not in accepting these statements at face value but in taking a look at the company’s official financial statements to see if the numbers add up.

Snapdeal’s filings show that the operating revenue of the company did see a significant uptick of 84%, from Rs 455 crore ($64 million) to Rs 839 crore ($118.5 million).

But that’s where the good news ends.

While the revenue numbers themselves have some curious discrepancies, a far more important takeaway is that contrary to the company’s claims of reducing operating losses by 70%, there is, in fact, a 32% YoY increase in like-to-like losses.


Sumanth Raghavendra

Sumanth is a serial entrepreneur with more than eighteen years experience in running startups. He is currently the founder of Deck App Technologies, a Bangalore-based startup attempting to re-imagine productivity software for the Post-PC era. Sumanth’s columns appear regularly in leading publications. He holds MBA degrees from the Indian Institute of Management, Bangalore and Thunderbird, The American Graduate School of International Management, USA.

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