1. Ecommerce has seen phenomenal growth in the past year
Ecommerce ecosystem was already gaining ground pre-2020 because of the convenience it brought to consumers. However, 2020 brought a step change in the sector growth that has allowed many ecommerce players to scale up faster than their earlier plans.
Note: Ecommerce sectors include online fashion, electronics, home furniture, grocery, and food orders
2. Consumer shift towards online is permanent and will drive further growth
The growth in the sector was primarily driven by a shift in consumer habits towards online channels. With restrictions on going out, social distancing measures & limited avenues to spend time on; consumers started adopted online channels for their needs. We are seeing that this online behavior is relatively sticky and consumers have continued to embrace the online channel.
3. Given the strong boost to ecommerce startups, we expect many companies to take the IPO route sooner than the norm
Many players in the ecommerce sector have emerged stronger while entering 2021 on the back of the rapid growth in 2020. We expect them to continue their growth journey while charting a clear path to improving unit economics and profitability. Given the relatively lower availability of funds in the region, we expect these startups to go public sooner than what we have seen in other markets, especially if the first few IPOs in the region do well.
Note: Includes companies with a stated intent to IPO & / or companies with a capital raise of $30M+