E-commerce aggregator 10Club nears bankruptcy after $70M
10Club, which is one of India’s top e-commerce aggregators having received $40 million in a single of its biggest venture capital deals, has filed for insolvency. Bengaluru-headquartered company delayed or defaulted on paying vendors and salaried employees in the form of part-payments for the past half year. Its failure to reorient the business model properly, particularly for home accessories and furnishing spaces where competition remains strong, has weighed heavily upon the company’s bankruptcy. At present, 10Club is consulting with lawyers and investors prior to submitting insolvency petitions to the National Company Law Tribunal (NCLT).
10Club’s strategy was predicated on the ‘Thrasio’ model, which involves merging numerous small e-commerce companies to optimize operations and enhance profitability. Though it had promising beginnings, the company could not match traditional home furnishings brands, including international giants like Ikea. Financial reports indicate a net loss of ₹116.3 crore as of March 31, 2024, compared to ₹16.6 crore in the last fiscal year.
This collapse puts into perspective larger problems in the e-commerce roll-up space. In particular, Thrasio, the first to employ this business strategy, closed its doors in November 2023, even with a prior valuation of $10 billion.
