Co-founders of Shajgoj, one of the most successful e-commerce platforms in the country, explain how to tap into an uncharted market and build an empire out of belief, merit and hard work.
When Nazmul Sheikh graduated from Bangladesh University of Engineering and Technology (BUET), he didn’t think, even in his wildest dreams, that he would sell beauty products one day.
But after working as a telecom engineer at home and abroad for years, Nazmul became exactly that – a leading beauty product marketeer in the country.
Shajgoj, a startup co-founded by Nazmul and two other partners, is currently Bangladesh’s top beauty and personal care e-commerce platform. And just recently it made headlines after securing a whopping Tk21crore seed funding from Sequoia Capital India – a venture capital firm that invests mainly in technology and healthcare.
“After Graduating from BUET, I started my career as a telecom engineer with Grameenphone. In 2008, I went to Nigeria and worked as a telecom consultant for five years.
Then I started realising that the telecom industry was going to become saturated soon,” Nazmul told The Business Standard while explaining his career switch.
“I started playing with ideas, and at one point, the beauty industry came to mind,” added Nazmul.
But what exactly was the thought process that led to this curious choice? It happened almost by chance, it appears.
During a stopover in Dubai on the way to Bangladesh, Nazmul’s wife, Sinthia Sharmin Islam went to a beauty store and spent two long hours there. When inquired, she told her husband that she hadn’t seen anything like that in Bangladesh.
It was then that the duo realised that Bangladesh had quite an undersized market in this sector. In Nazmul’s words, it was the ‘eureka moment’ of their coming venture.
Sinthia, a pharmacist by training, later became the CCO and co-founder of Shajgoj. She had prior experience in managing community pharmacies and beauty supply stores in Nigeria. “In Nigeria, beauty products have long been sold at pharmacy stores. It was there when we realised one needs consultation regarding using such products: as to which product would suit one’s skin, etc,” continued Nazmul.
So a big motivation for founding the venture was this: to do something to help people make the right decision when purchasing beauty or personal care products, added the self-described ‘engineer-turned-lipstick seller.’
The other co-founder of the startup, Milky Mahmud, also the COO, is a computer science graduate. He was a colleague of Nazmul in Grameenphone and also worked in a different country in Africa.
Milky had come back to Bangladesh earlier, and upon his return to the country, Nazmul shared his idea and invited Milky to do something together.
“This is how it started. After a year, we also returned to Bangladesh and started working full time on the idea,” said Nazmul.
During initial research on the sector, Nazmul felt that there was no major player in the country in the field of skincare, hair care and makeup.
However, in 2013, they felt it was too early to launch a company to sell beauty products online. There was no app for MFS at that time, and, also, the demand was not very high.
“We sensed we wouldn’t be able to sell enough products at that time. So instead, we decided to help build a market. We launched shajgoj.com and started posting tips and tricks videos and articles,” said the beauty startup co-founder.
Two and half years later, Nazmul felt it was time. Shajgoj started with a physical store at Jamuna Future Park and the second outlet came the next year at Simanto Sombhar.
The online service was launched in 2018.
“Now, after three years, we deliver 1,50,000 orders per day,” said a content Nazmul.
And the decision turned out to be wise in every aspect. Before securing investment from Sequoia, Shajgoj raised capital from Brac Osiris Impact Ventures and SBK Tech Venture, one of the pioneer tech-focused venture capitals in Bangladesh.
The company is receiving funds, and it is expanding. Shajgoj currently has two physical outlets in operation, and three more are in the pipeline, including one in Chattogram.
So, is the company making any profit yet?
Responding to this, Nazmul said, “Actually we are focusing on new customer acquisition. We currently have four lakh customers, and we think it is not a very big number. When we’ll have 30 lakh customers, we’ll then want to be profitable. To that end, we are hiring a lot of staff and investing a lot.”
The company does not want its growth to slow lest another market player should overtake it, the CEO added.
The rapid expansion paid off and has brought the startup the crown of the third-largest e-commerce platform in the country, led by Daraz and Chaldal.
So what are his tips for newer startups looking for investments?
The strategy is simple, replied Nazmul. “Focus on building a good company, if not great. Investors will come to you, you won’t have to go to them.”
Making a profit, or being on the way to making a profit is key, Nazmul said. “There is an impression that creating a noise about the startup, winning awards and growing fast will do the trick. But the fact of the matter is, investors will look into the company’s profit and loss accounts, the concept, and more importantly, the concept’s execution.”
Being an e-commerce platform, how does Shajgoj navigate through the recent trust issues that have been created around the sector?
Nazmul did not seem to be bothered.
“In every sector, some noise is created at the first stage. There were some actors who did this, but they will be lost in oblivion soon. At the same time, those who have managed to create a good customer experience, have nothing to worry about, because the customers also need the product.
I think we have done excellent in terms of trust and giving quality experience, as a result of which 70 percent of our customers are recurring customers,” said Nazmul Sheikh.