Wealth platform Jar sees hope in e-commerce, adds jewellery retailing to its offerings

The gold-focused micro-savings company quietly entered the e-commerce race in February with Nek, its direct-to-consumer jewellery brand, co-founder and CEO Nishchay AG told Mint. Nek is set to surpass ₹100 crore in annual recurring revenue (ARR) by October.

“Gold is a class that everyone understands and is very stable, so there’s a high appetite for gold, especially in the form of jewellery. Since we’ve enabled users to save in gold, we launched Nek as a jewellery brand,” Nishchay AG told Mint on October 8. The D2C brand is already profitable, he said.

Several Indian jewellery brands have grabbed the attention of investors and secured significant funding over the past year. In 2024 alone, Bluestone, Giva, Kushal’s, Aukera, Trisu, Salty, and Eternz, among others, successfully raised capital.

Archana Jahagirdar, founder and managing partner of Rukam Capital, told Mint that investor interest in the jewellery segment is driven by changing fashion trends among Indian women.

“Traditionally, jewellery was worn at weddings and festivals, but now, with more varied occasions, even our everyday attire has evolved. Indian women are increasingly wearing Indo-Western or Western outfits, creating a demand for different types of jewellery. There’s also a growing need to build brands within this segment, both at the lower and upper ends of the price spectrum,” she explained.

So far, Jar has raised $59.1 million from investors including Tiger Global Management, WEH Ventures and Tribe Capital. The company last raised $22.6 million in a funding round in August 2022, which valued it at over $300 million.

Pent-up demand

Founded in May 2021 by Misbah Ashraf and Nishchay, Jar helps users save small amounts of money with every online transaction, investing it in digital gold. Users can later withdraw this as physical gold or liquidate it.

With Nek, Jar will now offer the option of converting this digital gold into jewellery from the platform, too. Nek will focus exclusively on jewellery and doesn’t plan to expand into other consumer categories.

Jahagirdar added that the top line – how quickly a vertical is growing without excessive spending – is one of the most reliable ways to gauge the success of any strategy.

The core vertical, where Jar offers investment in digital gold, will continue to be the major driver…

“Their growth and that they’re already profitable as a segment indicates there was pent-up demand they successfully identified. They need to now build it out cohesively and strategically, rather than just being opportunistic,” she said.

Experts told Mint that breaking into this category is challenging as it takes time and patience to establish trust, build a brand and cultivate repeat customers.

“It’s difficult to penetrate this segment when operating solely online. In recent years, companies that have adopted an omnichannel approach have been able to crack the code,” said an operator in the segment who requested anonymity.

With competitors CaratLane, Bluestone and Giva, and legacy brands such as Tanishq, Jar’s Nek will need to proceed carefully and build out a niche to capture the interest of new-age consumers, they added.

Jar’s profit chase

The core vertical, where Jar offers investment in digital gold, will continue to be the major driver, clocking at least over 50% of the company’s revenue. Nishchay said on social media earlier this year that Jar’s ARR had crossed $20 million ( ₹168 crore).

“We at @JarAppHQ crossed $20 million ARR this July… It took us 3 years to go from 0-$10 million and only 3 months to go from $10 million to $20 million ARR… Super grateful and proud of everyone’s effort..Next milestone free cash flow,” he said in a post on X on 31 July.

The company was in a pre-revenue phase till FY22. In FY23, after the company started monetising its user base, its revenue was ₹8.7 crore. However, it posted a loss of ₹123 crore on the back of growing expenditure on branding and marketing to onboard customers.

“Many companies, including us, realised post-2022 how crucial monetisation is. Now, for every company, it’s a choice: you have to turn it on. That means cutting back on certain things and focusing on others,” the founder added.

Jar has not yet released its FY24 financials, but the company expects revenue growth and a reduction in losses, supported by lower marketing and branding costs.

Jar Plus takes a hit

Meanwhile, Jar paused its P2P lending-investment product Jar Plus, six months after rolling it out in phases to users. This followed new guidelines from the Reserve Bank of India banning peer-to-peer (P2P) lending platforms from advertising P2P loans as investment products. The norms affected LenDen Club, Jar’s partner for Jar Plus.

“We tested the P2P investment product for limited use-cases, which was Jar Plus, which is not serving anymore on the platform. We continuously do a lot of such experiments. It was activated for only a small cohort of users in a few PIN codes,” Nishchay told Mint.

Jar introduced Jar Plus in March this year as a revenue driver to monetise its growing user base, which has reached 22 million.

Nishchay added that even as the company has paused the investment product, LenDen Club continues as a lending partner for its platform.

The company, which offers instant loans to users through its partnership with NBFCs such as Aditya Birla Capital, Fibe, and Kreditbee, will continue to offer P2P lending through LenDen Club for now.