I clearly remember that I was part of the consensus that dismissed the entire idea of 10 minute delivery apps when they first launched. My reasoning back then was other than condoms, nothing is needed that quickly. Fast forward to today, I was trying to find my nail cutter and realised I had spent more time finding it than what it would take to get a new one. Even my mother has started taunting my dad that it’s better to order from BlinkIt than him getting it because the order will be here, by the time he even gets ready.

That’s when my curiosity peaked and I decided to write this essay as I’m more than happy to eat my words and admit that Quick commerce isn’t just a fad but it’s disrupting the behaviour of buying groceries in India. I wanted to explore what exactly changed that lead to them becoming so popular because delivering groceries online isn’t a new thing, Grofers (BlinkIt before it got acquired by Zomato), BigBasket and Dunzo have been in this space for a while but nothing blew up back then.

A warm welcome to the 89 new subscribers that joined us since last time and let’s dive in.

The Dark Magic

You may already know about — Dark stores, supermarkets where nobody can walk in but only order from. We have only understood dark stores from a quick delivery perspective as they are located nearby to residential areas. However that’s only a small part of the value they bring. We’ve massively underlooked the real value of dark stores which is:

• Increased optionality: Dark stores have about 6,000+ SKUs which is 6x of Kirana shops who have 500-1,000 SKUs. Which means that customers are more likely to find what they need on Quick-commerce than go to the Kirana shop.

• Higher Throughput: Since there are no walk in customers, the layout of these stores is planned and optimised for maximum efficiency. What it implies is that a dark store is able to sell more goods per square foot as compared to a general supermarket. BlinkIt is 1.9x more effective than any regular DMart stores.

• Leveraging Data: Regular Kirana shops rely on intuition to manage inventory and gauge demand. These Quick Commerce apps are data mines, every order makes them smarter about what people want and precisely how much. Not just that the entire stack is such that a packer can pack 6 items in less than 1.5 minutes of the order.

Dark stores have been around for a while, however the pandemic has pushed their demand ten folds and iterations have made them more efficient. BlinkIt and Instamart have around 450+ Dark stores around the country and Zepto, BBNow also have about 350.

All roads lead to BlinkIt

When it comes to market share by GMV: (source)

• BlinkIt is the clear winner by 46% of the market

• Instamart comes second which has a 27% share.

• Zepto is the new player on the block with 21% share, which grew rapidly in the last 2 years

• BBNow is the only other large player with 7% of the total market share.

Other players like Ola Dash, Flipkart Quick have exited the space or like Dunzo and Amazon Fresh have a negligible market share of the quick commerce gold rush. It proves that being first to market means nothing, you have to the be first to do it right, otherwise you’re merely providing R&D for the companies that come after you

The primary reason why Dunzo and other players failed is they did not innovate on the whole supply chain level. They were merely getting groceries from Kirana shops and their key innovation was just their app that allowed you to order from home. However in terms of optionality + delivery time there wasn’t enough delta compared to just getting it yourself. They tried Dark stores but they weren’t as efficient as the ones we have today.

Why BlinkIt Wins

A few weeks ago, I posted this comparison that blew up on twitter. I may have roasted Zepto and Instamart a bit too much but I still stand by this comparison:

• Honesty wins: Swiggy and Zepto have the most unreliable timers, this makes people lose trust. BlinkIt keeps it’s promise more often than these 2 and even when things are delayed they are communicative versus showing a fake estimate timer.

• Integrated app is a bug not a feature: I’m sure the Instamart PMs thought if they had a single app it would create more usage as people don’t need to switch, however that has turned out to be false as the Instamart’s confusing experience is switching many tabs, mixed up search results for doing a simple thing, where as in BlinkIt it’s open the app and get going.

• BlinkIt is going for the 6th star: Airbnb came up with this idea that 5 stars is not enough as that’s the basic service expected by a user. You should deliver an experience that makes someone want to give you a sixth star. BlinkIt is doing this by:

  • Providing Printouts at your doorstep. I’m sure this isn’t very profitable however it blows people’s minds.

  • Letting you search a recipe’s name and showing the ingredients you’d need to cook it.

  • Adding a switch called “Single’s mode” for single people who feel left out on Valentines day.

  • Letting you share your cart for your sibling to order for you.

  • Making their delivery bags with outline illustrations that you can color into.

  • Writing Quirky copy for their mothers day section. I saw some hilarious product placement like rolling pins for when you get late and saridon for when your bua arrives.

It feels like BlinkIt has achieved operations supremacy and is now doing side quests and building customer delight where as all other players are stuck in solving the basic promises.

BlinkIt for X is coming

While you might feel that BlinkIt or Instamart will become super apps where possibly any item can be ordered in 10 minutes, I disagree:

• Vertical vs Horizontal expansion: BlinkIt is trying to build horizontally by having one of every best seller in all possible categories. But they can’t go deep in one category so there is an opportunity to go niche and build vertically.

• Supply chains are hard to switch: Instamart’s logistics / storage / procurement and processes are setup according to their retail + FMCG needs. However they’ll need a completely different process if they wanted to deliver certain perishable items / frozen foods / high value items and so on. Which is hard for them to add on to their existing flows.

• Customer experience matters: Even if they had every possible items supply chain setup. The way people buy fashion is very different from groceries. People in fashion like ordering 3-4 SKUs and then selecting one. People buying gold would want some sort of purity tester and so on.

My new friend Ansh is building Blip which is BlinkIt for Fashion. It’s fairly new but another similar company that is YC backed Ole , which is delivering luxury fashion items in 50mins is growing 35% MoM and has a 7x AOV that it’s e-commerce competitors. My point is after getting a taste of quick commerce in groceries, consumers will expect the same delivery times in other places they order and we’re about to see a rise of BlinkIt for X startups.

What to build?

If you’re a builder who’s excited about this space but you feel it’s too late. Obviously the best time to build was 10 years ago but the second best time is today. Here are some ideas I’m excited about in this space:

• Give the power back to Kirana stores: BlinkIt is eating their market, they are desperate to get back but don’t have tech. Not just storefronts but analytics to predict demand / manage inventory and even insights on what people order in this area will be valuable.

• Build on top of ONDC: Leveraging ONDC’s existing network and discoverability will help you solve the cold start problem and it’s free markets / low fee structure will even give you an edge to compete against the leaders.

• Build Community for Delivery people: Trust me I have seen so many delivery people send each other short messages about what they’re doing. There should be a community focused for them where they can share / ask questions help each other. This becomes the spot where new people come to get trained, acts as a body that helps to fight for their rights and even the big companies like Zomato / Swiggy would be interested to acquire such communities.

• B2B Products: While the whole world is looking at quick commerce as a consumer trend. Don’t forget that Indiamart exists and there are so many industrial and b2b related products where the delivery time today is still in weeks or days. Having same day delivery there and some version of dark store infra will be disruptive.

• Whitelabel Dark Stores: D2C brands will soon want to deliver items in 10 minutes using their own branding and without involving BlinkIt as their middleman. If you setup dark stores that any brand can rent + use for a fee that’s lower than BlinkIt there’s value in doing so.

• Quick Commerce Agency: Right now so many brands want to go to BlinkIt or Instamart but they aren’t aware of the process and they’re run by old Dhanda people who aren’t savvy. If you’re a teen who’s entrepreneurial you should form good relations with the BlinkIt / Instamart team then just cold email old businesses and tell them you’d help them figure out their QC strategy. Become the go to expert in pricing / getting listing / operations and so on.
  

• Start Dark Stores in Tier 2 / 3: This might sound too obvious but currently dark stores are concentrated in the metro cities. If you live in a tier 2 or 3 city, you should start dark stores in your city and pitch to BlinkIt for expanding there.

fin.

I’m excited to see this space evolve and all the startups that will operate in this space. It still feels like the early days. If you’re building a company in this space, please write to me, I’d love to geek out on your product. For my usual readers (we’ve had 2 past issues lmao) I really appreciate you all opening my emails. I have a 51% open rate for my previous editions.

later losers,
Yash

Lately, many of my tweets have been doing numbers & to put in twitter terminology, I’ve been tweeting ‘casual bangers’. Which has led to my friends and strangers asking me largely two things:

1. Why did something blow up?

2. How am I consistently doing this?

I’m mildly offended by the first one, as people cannot accept my world class shitposting abilities to be the primary reason of why things are blowing up and assume there must be a secret sauce.

For those of you, who’re expecting this to be one of those Twitter growth hack reads, prepare to be terribly disappointed. While a lot has been spoken about growth hacks, I feel not enough has been said about — simply writing your tweets in a way that gets them more engagement and reposts.

A kind thank you to the 163 new subscribers who joined since last time, let’s dive in.

Don’t just push words, evoke emotions

Your words are meaningless and bland if they don’t make people feel things. Humans are highly emotional creatures.

I can’t believe I’m about to use the words “smart” and BuzzFeed together in one line, but the people at BuzzFeed figured out a really smart concept called as “Culture Cartography” & I know what you’re thinking isn’t this that company that made those dumb quizzes about which Disney princess are you today?

Love them or hate them, you can’t deny they are monstrously viral repeatedly. Culture Cartography is essentially these circles where each circle represents a feeling and obviously when your tweet makes someone feel things, they are more likely to share it with friends.

Tell stories that have high re-tell value

Think about the last 3 things you shared at a dinner table conversation. Every idea you re-told was because it was interesting and positioned you as smart/funny/insightful. Every story in the world has a re-tell value, some have been going on for decades, some might not even make it post this week.

To craft a highly re-tellable story you must look back into all the ‘aha moments’ in your life, but the most important thing is to keep this tale incredibly simple to tell. If it’s too many things to say or too complex, people won’t be able to re-create it.

Remember it’s always great to land a single funny joke vs have three or four mediocre ones.

Talk like how you’d text a friend

People want to connect with other humans, not yet another marketing threadboi who throws a couple of jargons and is eventually going to sell them a $5 course.

The simplest test is to read your tweets aloud. If that’s not how you talk in real life, nobody is going to feel what you want to share. The number of times I read people’s tweets and think “who tf talks like that?”

Writing casually and in simple language propels the level of authenticity and people can get to paying attention to what you have to say.

Reach Escape Velocity

Tweets don’t get viral suddenly. First a few people like it then a few more and then eventually everyone else. Just like a rocket needs to overcome the earth’s gravity to get out of the atmosphere. Your tweets need some initial love to get picked up by the algorithm.

Now all you geniuses who’re thinking to hire a clickfarm in Bangladesh or Indonesia. Please don’t, it doesn’t work. Send me the $10 I’ll like and retweet your tweets.

I know this feels obvious but the key insight here is, don’t write for a million people, write for the first 2-3 retweets. Whenever I’m tweeting something I always keep 3 of my friends in mind, that at-least these losers will enjoy what I’m saying. (shoutout to @paarugsethi, @pratikdholani & @abwshek)

Just companies every story and idea has a market-cap. Start by infecting patient 0 first, then a few more and then world domination.

Optimise for a scrolling experience

The last internet post you highly enjoyed might not’ve been that great but it’s comment section would be the reason why you found it hilarious. Hence, make people scroll beyond the first tweet.

Remember a tweet is not just a bunch of texts on a feed. It’s a little gathering of people who’re also excited about something you are. Everyone is a sucker for some good banter, make sure you engage with your early replies and have a scrollable experience and not just one tweet.

Tweet when you have high bursts of energy.

If you sit and think “what should I tweet?” you’ll probably go crazy and come up with bad ideas that are forced reverse engineered versions of popular tweets

Tweeting when you have this burst of energy from a real life experience, thought or whatever it is that you’re feeling translates into your writing. Authenticity cannot be recreated at will. Not only that, it will also solve your “when should I tweet” problem.

Retweets are outsourced opinions.

A retweet is a reward for saying something that people always wanted to say but couldn’t really find the words. If more people agree with you, you’ll see retweets, if they disagree with you there will be quote tweets.

Who cares, both are great for engagement.

Speak your truth

Don’t try to appear bigger than you are, keep your head down and be truthful. I know social media seems like you should fake it till you make it. But would you rather want people that are following you for your fake credentials or the people who were with you since day, even when you weren’t a big deal.

It’s better to write about things you have experienced first hand than become the leading expert in the world about the newest hot topic. I’d always follow someone who doesn’t know anything about a topic but is willing to share their experience with everyone in real time vs someone who’s pushing threads full of jargon.

Naval puts it the best:

Ship in prod

Tweet whatever comes to your mind. You need to exhaust your ideas to get new ones. Don’t let mediocre content, just not be in the notepad. Share it with the world and spread it, why suffer alone?

You cannot sit and ponder about how well will something do? There is only one way to find out and it is by hitting the publish button. You can always delete the ones that aren’t so great.I often tweet the most basic thing like what I’m eating, just to get things out of my system and kickstart my brain to get my creative juices flowing.

Remember tweeting is a muscle, not a puzzle. You have to train for it everyday to be fit versus figure out some puzzle code after which life will be easy.

Tweet like the backspace button doesn’t exist.

Conclusion

Broadly speaking, you will not become good at twitter if you’re not clear on why you want to do so? For me I really love the clout and the joy of being internet famous for something dumb I said. For you it can be creating more distribution, awareness for your product and what not. But have some intention, it will help you to keep going even when you have 0 likes.

And to re-state the obvious, your engagement is directly proportional to how well you can express your thoughts. This has two parts — knowing what you feel, You can journal often to keep track. And expressing it out with clarity, Which is improving your writing skills. This Dilbert blog from 2007 is still golden.

I hope what I wrote made some sense to you and got you thinking beyond the growth hacks. My final word to you is, experience more things in real life and then tell them on twitter. People who are great at twitter often are great at real life too, not vice versa. peace.

Later losers,
Yash

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P.S: A bunch of us are hanging out tomorrow ( 9PM IST) to discuss the principles in this essay. I’m calling it Bangers Only. I’d love to have some more people there. Feel free to join — https://lu.ma/bangers-only

The threadbois are usually declaring products like MS Excel (245M paid users, $44B / ARR) dead because someone on Twitter has successfully built the 97th clone of a UI wrapper on ChatGPT.

Whereas the Doomers sound smart by throwing in complex words but it’s always some version of  “what if chatbots reach AGI and kill us” or whatever Sci-Fi concept they’re calling as “research” this week. 

If you share my disappointment with these overly generic & extreme takes. I’ve tirelessly scoured the internet & compiled a few fresh perspectives.

Let’s dive in.

Fast Growth, Faster Churn.

Earlier last week, Andrew Chen raised an important point about how we’re blinded by the rapid growth of these AI apps & we’re ignoring the high churn / low retention problem.

Before we dive into why this is happening. Let me make this problem more real for you.

Lensa is a great example. The AI portrait app was doing an impressive revenue of $2M a day. However this was short-lived as revenues quickly plummeted to a low thousand figures.

Don’t get me wrong. $37M in 60 days, after app store fees is one hell of a feat. But it does highlight that the retention problem in AI still needs to be solved.

Even Indie-hackers like Bhanu Teja, reported a high churn on their apps. Bhanu is building SiteGPT, a chatbot that’s trained on your website’s content. He lost $5K in May Churn on his $15K MRR.

The main reasons behind the churn problem are:

1. UX & Usability of AI apps sucks: Most of them are poorly stitched clunky MVPs that are front-end wrappers on APIs. Delivering a frustrating experience.

2. Missing Last Mile Features: Generative features aren’t enough, as they are merely hooks. For example: Users of a pitch deck AI app now want same features as Google Slides.

3. No Network Effects: Almost all AI apps are currently single player, which doesn’t have any viral coefficients. Apps must integrate collaborative & social features to retain users.

4. Vitamins vs Painkillers: Vitamins are “nice to have” whereas Painkillers are “need to have” and non-negotiable. Most AI apps don’t even fall under Vitamins, as they are merely candy solutions.

5. Frequency of Use: Stickyness of an app is also a direct function of how recurring the problem is. For most AI apps it’s a one time thing.

The TL:DR; If you want to build a sustainable AI app, don’t get blinded in growth metrics, focus on what fundamental value are you solving for someone & think of how often can you keep solving for them.

The catch-up game is reversed.

The fast growing AI tools on the market are facing a new challenge. 

Turns out that the “Generative AI” features merely serve as hooks to attract users. However once they are onboard, they demand features & an experience comparable to the legacy tools.

Consider an AI writing or pitch deck app. Users now demand:

1. The features already present in Google Slides / Docs

2. The performance / reliability & snappy-ness of these features.

It’s amusing to note the reversal of this race as, not a long time ago the traditional companies were trying to catch up with the new AI players.

While the gap in the old race is reducing as most generative AI features are wrappers on top of the ChatGPT API. But the reverse catchup of building features that legacy tools spent years building & refining — might spell doom for many companies. 

This explains why there has been an increase of listings of these rapidly growing AI companies on MicroAcquire. 

The bottom line is — after being through many AI winters, we are now headed towards the “Plateau of Productivity” and while that’s generally a good thing for AI but the reality is many companies won’t survive the feature race. Brace yourselves for an upcoming season of acquisitions & deaths.

Infrastructure never dies

“In a gold rush, always sell shovels”

It might sound cliche, but it’s true even in the AI gold rush, the most value is currently being captured in the infrastructure layer and no, I’m not talking about NVIDIA.

Remember how earlier I mentioned that the traditional tools were catching up to their AI alternatives? It’s not like they suddenly became more productive or their operational inefficiencies disappeared.

The answer for what’s driving this transformation lies in — AI SDKs. They’re pieces of boilerplate code that you can simply plug and play into your app & quickly add AI.

Vercel was able to see this & they quickly launched their own AI SDK.

You either create vast SDKs like Vercel or go ultra niche on a single UI component like Steven Tey’s Novel.sh — It’s notion like “Help me write with AI” but open source.

The reason why this is powerful is consider these two gentlemen.

Jim Raptis who was building an image editing app & Tim Bennetto who was building a thread writing app. Both were able to quickly just add AI to their products without the heavy lifting.

MOATs wise, SDKs are very defensible as the cost of switching them is very high and unlike web3, AI is fully embraced & encouraged by big tech, which is driving the confidence & fomo amongst the medium & small tech players.

The gist is — Everyone and their mom is going to integrate AI into their apps, thanks to SDKs.

(P.S: If you’re looking for more SDK ideas, highly recommend reading this article by A16 which highlights the emerging tech architectures for LLM apps)

That’s it for today.

I’m super pumped about starting this Substack

I’ve always wanted to have my corner on the Internet where I share my thoughts & obsess about things with strangers from all over <3

Whoever is the most subscribed substack, I’m coming for you.

Just kidding lol we have 3 subscribers (Thanks mom!) , please consider subscribing & sharing with your friends.

Best,
Yash.