A last mile rural marketplace that connects rural entrepreneurs with buyers

Though over 60 per cent of Indians live in rural areas, reaching out to them has always been a challenge for companies across sectors. Similarly, rural entrepreneurs, be it farmers, weavers or dairy farmers, all of them find it equally challenging to get a credible platform where they could sell their produce directly without interference of middlemen.

Hyderabad-headquartered Hesa, which started as a rural marketing and event management company in 2012, in the last one year has pivoted into becoming a last mile digital rural marketplace. It connects the rural entrepreneurs with buyers and also doubles up as a platform where rural consumers can buy services such as insurance and also do bank transactions.

"There are major gaps in supply and demand both from a business point of view as well as consumers. On the business side, the problem is unit economics. The cost of setting up a distribution mechanism often doesn't match with the revenue that a company earns," explains Vamsi Udayagiri, Founder and CEO, Hesa.

Udayagiri, started with a physical platform, Janata Expo, where he connected weavers entrepreneurs and agri-producers with buyers in Andhra and Telangana. Last year, Hesa went 'phygital' with the launch of its app. The rural consumers' or entrepreneurs' point of contact is a 'Hesaathi', a village level entrepreneur, who is invariably a member of either a women's self-help group or is a progressive farmer. The Hesaathi, through the app, helps the entrepreneur to connect with the buyer and even enables her to do bank transactions without having to step out of the village.

Hesa has tied up with micro-finance organisations to facilitate its consumers living in rural areas to repay their loans. "These entrepreneurs have to leave their daily chores and travel to a bank at the nearest town, stand in a queue in order to pay their interest, and if they don't do it on time their credit gets impacted. We have solved this problem by integrating the bank's payment application on our platform," says Udayagiri.

The B2B2C platform aggregates agricultural produce and supplies to retailers such as Walmart and Metro Cash & Carry. It has also signed up State Bank of India for its KYC service in rural markets. While the platform is free for the consumers and entrepreneurs, it earns its revenue through commissions from the 35 companies it has partnered with.

"Our revenue model is transaction-based," says Udaygiri. "If there is a Rs 100 transaction that happens on our platform, we get Rs 2 if it is a financial transaction, if it's an agri transaction we get Rs 8 and if it is a services or insurance transaction, we get upwards of Rs 15. Out of this, 80 per cent is passed on to the village-level entrepreneur and 20 per cent remains with us," he further explains. The platform on an average does 50,000-60,000 transactions per month. A Hesaathi earns anywhere between Rs 5,000-6,000 per month.

Hesa is currently present in 11 districts of Andhra and Telengana and reaches out to 6,000 villages. It has a network of over 5,000 Hesaathis. Udaygiri hopes to have at least 25,000 village-level entrepreneurs by end of the year. It has already spread its wings in the neighbouring states of Odisha, Chhattisgarh and Karnataka and the plan is to penetrate further into these states.

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