ONDC receives support from major technology investors

Despite some doomsday predictions armchair researchers on how the ONDC might be a more difficult kettle for government to implement, there is enough evidence to suggest that large corporations actually believe that decentralization as a tool would go a long way to expanding India’s e-commerce footprint.

The first big name in e-commerce to announce it was hooked up to ONDC was Snapdeal, which confirmed that more than 2,500 cities and towns would be activated when it joins the network from August. It also confirmed inter- and intra-city logistics through its third-party providers when it opened with three categories, namely fashion, home and beauty and personal care.

However, in what should be music to the folks at ONDC, reports are now coming in that big tech investors like SoftBank and Sequoia Capital are advising their portfolio companies to join the network. This is the result of multiple discussions that ONDC leaders have had with these companies.

For its part, the ONDC sought to clarify that the initiative is not intended to break the monopoly of Amazon and Flipkart, owned by Walmart. “We are not here to challenge them. We are essentially e-commerce enablers helping small retailers to take advantage of the digitization of commerce through our network,” said Shireesh Joshi, Chief Commercial Officer of ONDC.

Given this clarity, it’s no surprise that senior venture capital fund executives now seem convinced that the ONDC would only strengthen their portfolio companies’ footprints in the e-commerce space. ONDC chief executive T Koshy had recently clarified that “entities that prepare for this new reality will reap the benefits and others will pay the price”.

During this time a report published in the Economic Times says fund managers have been in discussions to clarify exactly how things would work with ONDC and the scope of its work. After those talks, investors such as SoftBank, which boasts some of the big companies in its e-commerce portfolio, were convinced enough to suggest joining.

In fact, the report also claims that the Indian Venture Capital Association (IVCA) recently had discussions with the ONDC team to understand how various startups could collaborate on the network. Meanwhile, a group of startups such as eSamudaay have already partnered with ONDC to help small businesses go digital.

Other startups that have already made their presence felt in the delivery landscape appear to be in discussion. The report says logistics aggregator Shiprocket is set to join the network which could simply deliver goods between cities purchased from suppliers who are onboard the ONDC network.