India’s Taggle.com Closes its Doors
Off and running
It was only 18 months ago when Bangalore based startup Taggle opened its virtual doors. The company launched in June 2010 in the middle of a controversy that the concept of group buying in India had already been done to death. Regardless of the media, Taggle co-founders John Kuruvilla, Ujjwal Tickoo and Tej Arora believed in a sustainable business. The company raised an initial $1 million in venture capital. Taggle.com was good to go.
Within the first six weeks of operations, Taggle had gathered a user base in excess of 100,000. Within the first 3 months, the company’s revenues had increased by 10-fold. Venture capitalists Greylock Partners and Battery Ventures believed in the company, or at least the management team to the extent of helping Taggle with additional funding. Sources peg that number in the $8.5 million to $8.75 million area. It sure appeared as thought Taggle was off and running.
Letter to Taggle users
Today is a completely different story. This is what subscribers of Taggle’s are reading today:
Dear Users,
We have decided to cease our ecommerce operations effective immediately. We will not be taking any more orders from our users.
We started Taggle in June 2010 with US$1M in funding to build a sustainable and profitable business by getting the best service and product deals for our users. We have always believed in providing superior experience and value to our users. When we realized that service deals were not giving the best value to users, we quickly shifted focus to only products. Our users responded very positively to the shift and it reflected in our revenue numbers too, we grew our revenues 10 times within 3 months of the shift.
However, the current market conditions have many ecommerce players selling products at below cost price to lure users. The only way to sustain the business at this time is to get into a price war and burn a lot of investor money and try to outdo competition in a Last Man Standing game. This practice goes against our philosophy of building a sustainable and profitable company. Hence, we’ve decided to go back to the drawing board to figure out the best way forward.
We thank all our users who have shown trust in us and supported us with their business.
In case you have any questions or want to reach out to us we can be reached by email at care@taggle.com
Thank You
Team Taggle.
PS: We will be refunding Taggle Cash balance to the customers, but Taggle Points are not redeemable in cash, please see http://www.taggle.com/tos for details.
Cutthroat competition
Unfortunately for Taggle, the company appears to be a sign of the times. We have noted in many posts that the daily deal industry has an extremely low entry to barrier. Only the strong will survive. Taggle began to struggle with competition earlier this summer. By August, it seemed as though the writing was on the wall and the month was highlighted by the resignation of CEO John Kuruvilla.
It’s interesting to note that several daily dealing sites in India literally cut and pasted their way into business as clones to Groupon. In my opinion, to enter an industry without first doing a lot of homework is suicide. I am not suggesting that this was Taggle’s route. The original three founders contained some very impressive resumes. It will be interesting to see how (or if) this company moves forward after they “go back to the drawing board.”
Source: MediaNama
