Shark Tank India Season 3: What you sell at throwaway prices, these two youngsters have created a business worth Rs 200 cr from that

Shark Tank India Season 3: Working for ShopClues on hefty packages of Rs 40-45 lakh annually made their lives comfortable for entrepreneurs Avneet Shetty and Saket Saurav. But a good amount of money mattered little to them, as they had dreams of creating their own brand that could help them realise their potential. Around 2017, sales of ShopClues' refurbished item category took a dip, and the company's debt problem cropped up. With this change, Avneet and Saket's interest in their jobs also dipped. Or rather, it catalysed their enthusiasm to a few notches to start their own brand. They were nearing 30 and had every reason to experiment with their careers. They quit their jobs, dipped in from savings, took a loan of Rs 15 lakh, and established their startup, ReFit Global, in May 2017. 

Cut to the present, their brand has become the second-largest company selling refurbished mobile phones after Cashify. 

Cut to Friday's Shark Tank India Season 3 episode, their six-year-old startup garnered nationwide attention after receiving funding of Rs 2 crore, and a valuation of Rs 200 crore from Anupam Mittal, Amit Jain, and Vineeta Singh. 

Once you are famous, information about you travels at lightning speed. 

So, within 24 hours after winning the Shark Tank India Season 3 deal, the traffic on ReFit Global's e-commerce website increased almost 50 times. 

As many as 5000 distributors contacted the founders within 24 hours of the deal.

Read the story of the duo entrepreneurs who dreamed big and are now moving step-by-step to realise it.  

Shark Tank India Season 3: What does startup ReFit Global do?

Avneet and Saket's startup, ReFit Global, refurbishes mobile phones. 

Their direct-to-customer (D2C) startup purchases old mobile phones, which come on exchange offers from Amazon, Flipkart, and other retailer websites. 

The company runs the Refit Diagnostic App on all these mobile phones. 

The startup claims that this app checks the device on 47 parameters. 

Through this test, the performance and problems of different parts of mobile phones are understood. 

An in-house team rectifies these problems. 

When the phone is ready, the Refit Diagnostic app app is run again to double check. 

When everything is okay, the phone is given to the retailer for sale. 

Till now, the company claims to have sold about 15 lakh mobiles offline, and its phones have reached more than 50,000 outlets.

Shark Tank India Season 3: Where did the idea of refurbishing old phones come from?

Both Saket and Avneet have been friends since college and studied MBA together. 

While Avneet started working at Videocon, Saket joined LG Electronics after pursuing their MBAs. 

After five years, Saket joined ShopClues as category manager for large appliances. 

Avneek followed him and joined Shopclues on Saket's team. 

They were part of the launch team for the refurbished category in the company. 

Just 7-8 months into the launch, Shopclues' refurbished category business reached about Rs 40 crore.

In 2017, when Shopclues' business took a hit due to some reason, the duo decided to make a move and launch ReFit Global. 

It was the time when the refurbishment market was growing rapidly in western countries, and major companies were entering this business. 

The duo was confident that if not today, then tomorrow, the same market would grow in India, since whatever happens in the West will reach India.

Anveet and Saket had about 8–9 years of corporate experience and had some good contacts in the industry. 

But no business idea can materialise without money and resources, and this was the area where Avneet and Saket were lacking. 

They had savings of about Rs 40 lakh, but they still needed another Rs 15 lakh. 

They lent money from a bank and started ReFit Global with Rs 55 lakh. 

Since it was their own money, they didn't opt for the burning model and tried making a profit from Day 1.

Shark Tank India Season 3: Is ReFit Global making money?

In the Shark Tak India episode, the founders claimed that the business has spread to more than 80 cities in India. 

They said that the turnover was Rs 187 crore last year, which is expected to be around Rs 240–250 crore this year. 

When they pitched their idea to Sharks on Friday, the judges looked unimpressed, but they showed interest when ReFit Global founders told them that it would make a business of Rs 240 crore this year.

Saket says that the price of his refurbished phone is 30 per cent to 80 per cent less than the new one. 

Every ReFit Global phone comes with a six-month warranty.

Shark Tank India Season 3: How do Avneet and Saket ensure profitability?

Since money was less, both of them decided to establish a good hold in the offline market, and that too in the B2B section. 

While working at ShopClues, they had many contacts related to this industry, and they started working with those old retailers. 

When the retailers started getting strong returns on ReFit Global's products, they also started placing orders rapidly. 

In the initial phase, both the co-founders themselves would keep the phones in their cars and go out to deliver them to retailers.

Shark Tank India Season 3: ReFit Global enters D2C market

Till now, this startup has focused on offline, but now the company has also entered the D2C market through its e-commerce website. 

Shark Tank India Season 3: Funding and future plans

In Shark Tank, ReFit Global founders demanded Rs 2 crore instead of 0.5 per cent on a valuation of Rs 400 crore.

However, after negotiations with the Sharks, Saket and Avneet struck a deal for Rs 2 crore in exchange for 1 per cent equity at a valuation of Rs 200 crore, plus 1 per cent royalty until Rs 3 crore is paid back to the Sharks.

Anupam Mittal, Amit Jain and Vineeta Singh have come together in this deal.