Why India's Next Retail Revolution is from Lucknow & Not Bangalore
While Bangalore founders raise millions for 10-minute grocery delivery, Nikhil Sewak spent 16 years building distribution networks across UP and Bihar. Now he's bringing AI to physical retail in tier 2 cities where relationships matter more than transactions and shopkeepers are kings.
Bangalore founders are raising millions to deliver groceries in 10 minutes. Meanwhile in Lucknow, there's a mechanical engineer who spent 16 years understanding why a shopkeeper in Kanpur trusts certain distributors over others.
Nikhil Sewak is a BITS Pilani graduate who managed DNS Industries for over a decade and a half, building distribution networks for household cleaning products across UP and Bihar. He knows what it takes to get a product from a factory floor into a retailer's hands in Varanasi. He's seen thousands of small retailers struggle as organized retail and e-commerce moved in. And he's watched tech founders completely ignore the fact that physical retail still accounts for the vast majority of shopping in India's tier 2 and tier 3 cities.
Eight months ago, he started Yett, an AI-driven discovery platform connecting retail brands with local shoppers in India's smaller cities. Not in Bangalore. Not in Delhi. In Lucknow. Because Lucknow gives him a strategic advantage that no WeWork in a metro could ever provide. He understands the local culture, the shopping behaviors, the trust networks that make or break retailers. He knows that in these cities, shopping isn't a transaction, it's a social event. And he's building tech that respects that reality instead of trying to change it.
This conversation is about why the next retail revolution won't come from quick commerce or social commerce. It'll come from someone who actually understands how physical retail works in the cities where 70% of India still lives and shops.
Key Takeaways: The Overlooked Reality of Indian Retail
Why Tier 2 Cities Matter:
- Offline shopping is easier in tier 2 cities: less traffic, less noise, more welcoming
- Shopping is social and family-oriented, not solitary like in metros
- Each city has distinct hubs with local crafts and cultural identity (Banarasi saris in Varanasi, Chanderi in Indore)
What 16 Years in Distribution Taught:
- Retailers are kings: whatever they show to shoppers gets sold, relationships matter more than anything
- Offers and discounts get you in the door, but quality builds brands in medium to premium segments
- Playing on price alone is a death spiral that compromises quality
The Yett Model:
- 200+ retailers onboarded in 8 months without an app initially, just vision and trust
- AI chatbot "Ask Yett" with human-in-the-loop: retailers get 24 hours to respond to shopper queries
- Works cluster by cluster: convert one premium business, others follow due to trust
Currency is Relationships, Not Transactions:
- Business development teams focus on building trust first, not closing deals
- Transparency matters: show retailers all customer data, hide nothing
- Start with small plans, let results convert them to bigger commitments
Q: You spent 16 years in manufacturing and distribution. How did that lead to building a tech startup?
Nikhil Sewak: It wasn't all of a sudden, it came little by little. The idea of Yett actually came from certain fundamental things I saw. As a hotelier, I saw that we owned real assets but discovery was broken. A large part of our revenue goes to online travel agencies just to get discovered. As a small manufacturer, I saw that digital leads had become a valid business. Coming from a city like Lucknow, I'm more prone to offline shopping. There have been multiple times I visited the mall but somehow I would forget what all stores are there. Google would come to the rescue but if I wanted to know what all offers are going on, it became a more acute problem. It struck me that despite offline retail being so central to our lives, it is still messy and confusing. That's how the seeds of Yett were born.
🔥 ChaiNet's Hot Take: The best startup ideas don't come from Silicon Valley blogs. They come from 16 years of watching revenue leak to middlemen.
Q: What did your 16 years in distribution teach you about Indian retail that you couldn't have learned anywhere else?
Nikhil Sewak: Firstly, I would say that a retailer plays a pivoting role. He is kind of a king. Whatever products he shows to the shopper, that gets sold. Your relationship with the retailer is very important. The other thing is that retail commerce is as much economical or transactional as it is human or relationship driven. In offline retail, offers and discounts play a huge role. They can get you an initial push in the market and create a space for yourself. But if you keep continuing with the same offers and discounts, it gets boring. You need to be innovative in offline commerce as well. Being in the detergent space, I found out that I could actually increase my volume by lowering my prices but that would mean compromising with quality. If you want to build a brand, you need to play more in the medium or premium segments because that is where brands get built. You are not compromising with quality.
🔥 ChaiNet's Hot Take: Every retailer is a curator. Win the curator and you win the customer. Lose the curator and your product dies on the shelf.
Q: Walk me through what Yett actually does. Use a real-world example.
Nikhil Sewak: If you want to know anything in the offline retail space before stepping out, Yett helps in the pre-shopping discovery phase. Suppose you are new to the city and a lot of people in the cities we're building for are migrants new to the city. They wouldn't know where to shop for lighting or where to get home decor or ethnic or local lehengas or even departmental stores or essential needs. You can use the "New to City" feature to find instantly all these things in just a single tap. We have three categories: malls, hubs, and stores. With just one tap you can explore the retail shopping scene in your city. What is actually interesting is that we have e-commerce platforms, social commerce platforms, and a plethora of quick commerce platforms, but surprisingly there is no dedicated digital platform for offline shopping. That is what we are envisioning with Yett.
🔥 ChaiNet's Hot Take: Everyone's building apps to replace physical retail. Nikhil's building one to enhance it. Sometimes the revolution is evolution, not disruption.
Q: Why focus on tier 2 cities like Lucknow, Agra, Indore instead of metros?
Nikhil Sewak: It was a practical decision. I belong to Lucknow, know this city deeply. I thought why not start with a city which I know. Offline shopping here still retains its charm. It's a counterintuitive argument: if I can build something in Lucknow where digital adoption is low and purchasing power is less compared to metros, if something can work in Lucknow, I think it becomes easier for me to scale to tier one cities. The other aspect is that I'm betting on local businesses. These local businesses are treated more like brands in these cities. They are brands in their own right rather than if we compare in metros. The fact that these tier 2 and tier 3 cities actually have a cultural identity and local crafts, say for example Banarasi sari in Varanasi or Chanderi sari in Indore, that gives a distinct advantage which they can actually sell to the world for shopping related purposes.
🔥 ChaiNet's Hot Take: Building where adoption is hardest isn't masochism, it's strategy. Crack the hard problem and metros become easy mode.
Q: What does shopping in Lucknow look like versus someone sitting in a WeWork in Bangalore?
Nikhil Sewak: Offline shopping is much more easier here. There is lesser traffic and lesser noise and it is more welcome in the way that in metros the tech ecosystem is driven by online commerce. The psyche favors online commerce compared to tier 2 cities where economy actually grows and thrives through these offline commerce centers. The other aspect is that shopping here is social rather than solitary because people are living in families. You would have your friends, family, relatives whom you would take along with you for shopping. And the third is that all these cities have a kind of a hub where you would find distinct identities, where you can source products in those hubs. These are the main distinctive categories which make offline commerce or physical retail different in tier 2 cities like Lucknow versus Bangalore or Mumbai.
🔥 ChaiNet's Hot Take: In metros, shopping is a chore you outsource to apps. In tier 2 cities, it's a cultural event you attend with family.
Q: You're calling Yett an AI-driven platform. What's the actual AI in your product?
Nikhil Sewak: Since we are building for both businesses and shoppers, we are leveraging AI in both aspects. On the shopper side, there is going to be a chatbot named Ask Yett where you can ask local contextual questions or queries regarding physical retail in these cities. As we build data we'll be able to provide relevant answers to these shopper queries. An interesting aspect is that we are trying to build a blended chatbot where not only we would be answering from our own database but we will be actually shooting that query to different merchants so that they can also respond in a 24-hour window. A human-in-the-loop kind of chatbot. On the AI side for businesses, we want to use that data so they can be discovered on LLM agents, be verified on those LLM agents, and maybe transactable going forward on the ChatGPTs of the world.
🔥 ChaiNet's Hot Take: Pure AI chatbots are cold. Human-in-the-loop chatbots respect that some questions need a shopkeeper's warmth, not an algorithm's speed.
Q: Where does your data even come from if these tier 2 retailers aren't digitized?
Nikhil Sewak: The data is coming from our business development team. We have a team who actually go to these stores and collect the data. There is a dearth of data and therein lies the opportunity. If we can structure that data, that would be useful for these businesses as well. The other source of data is the merchants themselves because they have a merchant portal which we have made quite simple. They can actually update their details. Even if they don't know any CRM or not used to it, it's quite simple to update offers, catalogs, other details. The third aspect is the shopper who would be interacting on the platform, maybe using the Ask Yett feature or connecting with these businesses, favoriting them or uploading their receipt. That would be another source of intelligent insight for shopping.
🔥 ChaiNet's Hot Take: Data doesn't exist in the cloud for tier 2 retail. It exists in shopkeepers' heads. Extracting it requires humans, not APIs.
Q: You've onboarded 200+ retailers. How do you even convince 55-year-old shopkeepers who've been running businesses for 30 years to adopt tech?
Nikhil Sewak: One of the major overlooked aspects is that the fact that they have been running for so many years means they know that if they want to stay in the market, they need to change. That is built into their genes. Surprisingly, even my business development team found it quite surprising that the older generation were also receptive to adopting a digital platform because they knew this is going to be the future. For me, adopting businesses wasn't a difficult task. The UI is quite simple and we are not throwing tech jargon at them. We are just telling them you have an existing model that is working, we just want to make you visible to people who are not even in your streets or in your city so that they can know about your craft, know the story that you want to tell them.
🔥 ChaiNet's Hot Take: Old shopkeepers aren't tech-averse, they're bullshit-averse. Speak their language and they'll adopt faster than your SaaS dashboard.
Q: Walk me through how your sales team actually works. How do you onboard a jewelry shop in Indore?
Nikhil Sewak: Trust needs to be established initially. Rather than telling that we need to onboard you, the person would actually get to know about their craft, what their business model is, and then explain to them in a non-technical manner how Yett can help increase their reach without impacting their business model. We think that small is beautiful. Even the small store which caters to 10 businesses is doing it because it wants to customize products for all of them and their quality is no less than a large store. That is how we build trust. We also tell them that we are not going to hide any data or any customer insight. Your number would be visible, any person which favorites you or uploads their receipt or asks for a product notification, you'll get the relevant information. By not hiding this information, it's also helping us improve our model. Another interesting insight is that we actually focus on a particular cluster. If we can onboard different premium businesses in that cluster, that builds trust for other businesses in that cluster, and then we move to other harsh clusters.
🔥 ChaiNet's Hot Take: Cluster by cluster, trust by trust. This isn't SaaS sales, this is community building with a cap table.
Q: Trust, culture, community, clusters—these aren't traditional tech metrics. How do you build a tech platform where currency is relationships, not transactions?
Nikhil Sewak: That trust develops by being non-technical in nature, being transparent about the insights of customers that would actually look at them, discover them on a platform. Another way of developing trust is through our business development team. I actually tell them that they don't have to overpromise and underdeliver. That helps build trust. How we have progressed is that people who have taken a growth plan which is 5x lesser than the other plans, those who have trusted us with the growth plan have actually taken the bigger plan. So trust is built gradually. That is how we have done this.
🔥 ChaiNet's Hot Take: Tech metrics measure transactions. Real business measures transformations. Start small, deliver value, trust compounds faster than MRR.
Q: Why are migrants to tier 2 cities a key demographic for Yett?
Nikhil Sewak: That is a very sizable chunk of population who are migrating to tier 2 cities, just like people in tier 2 cities flock to metros or tier one cities for the same reasons: more opportunities for jobs, better living conditions, better quality of life. I would divide it into three categories. One is students who want a better quality of education. Others are looking for jobs. The third would be newly married or people who are looking for a better quality of life and moving to these cities and setting up their home. These are going to drive the next future demand which a lot of people are seeing in tier 2 retail and this is where Yett is catering to them.
🔥 ChaiNet's Hot Take: Everyone obsesses over metros. Meanwhile millions are reverse migrating to tier 2 cities for life, not just jobs. That's your market.
Q: What's your advice for folks in conventional businesses who want to start a tech startup?
Nikhil Sewak: I would suggest them not to take the reverse journey from being a marketer to trying to become a techie because it's quite a difficult job. They should leverage their actual experience which they have gained working in the sector which they belong and use that intuition to actually build products. First would be hiring good development agencies. Leave the tech bit to them and use your experience, use what you know best. The other aspect is storytelling is important, either to your investors or to the team or to your customers because frankly speaking you just have a vision in mind and for people to feel that vision you need to be a good storyteller. You can use your rich experience to augment or amplify those stories. Don't be intimidated by tech and also not try to become a techie. Use your experience to guide you.
🔥 ChaiNet's Hot Take: Don't learn to code. Learn to hire coders. Your 16 years in distribution is worth more than 16 weeks of coding bootcamp.
Q: You mentioned you built part of your app UI through Lovable. What's your take on no-code tools?
Nikhil Sewak: I did actually build a part of my app, the UI interface through Lovable. But I would say that is just an intuition or that is just the beginning of something which you should leave to the techies to solve for you. These tools make things clear in your mind as well, how you can actually build those things. Not just explaining it to the developer, using these tools makes things clear in your own mind.
🔥 ChaiNet's Hot Take: No-code tools aren't for production. They're for clarity. Build your MVP to understand your idea, then hire real talent to ship it.
Q: Initially you didn't even have an app. How did you onboard merchants with just a vision?
Nikhil Sewak: Initially it was quite a difficult task because we didn't have the app itself and just to speak to those merchants and tell them that we want to onboard you, it was quite difficult. But as things have progressed it has become easier and now I get a lot of queries regarding merchants who want me to onboard them. The equation is changing because of that trust developing and the product in the market. Initial days were difficult in the sense that onboarding different business development teams was difficult because I had to build a team with just a vision in mind. To get them motivated was difficult. But now I have come to a stage where people even in Nagpur are contacting me that they would want to start in Nagpur or Nashik. Things have gradually started becoming easier.
🔥 ChaiNet's Hot Take: No product, no problem. Vision plus persistence beats polished pitch decks. Merchants bought the future, not the features.
Final Thoughts: The Overlooked Goldmine
Nikhil's philosophy: "Don't be intimidated by tech and also not try to become a techie. Use your experience to guide you. Small is beautiful."
The bottom line: Everyone's chasing the shiny objects. Quick commerce. Social commerce. Vertical SaaS for metros. Meanwhile, 70% of India still shops offline in tier 2 and tier 3 cities, and nobody's building tech for them. Not because it's not a big market. Because it's a hard market. You can't crack it from a WeWork in Bangalore. You need to understand that in Lucknow, shopping is a family event, not a transaction. That retailers are curators, not just shopkeepers. That trust moves cluster by cluster, not through viral loops.
Nikhil spent 16 years building distribution networks for cleaning products. Most people would see that as wasted time before "finally" starting a tech company. But those 16 years are his unfair advantage. He knows that relationships matter more than CAC. He knows that a retailer in Kanpur won't trust you until you prove you understand his business. He knows that playing on price alone is a death spiral that kills quality and brands. These aren't things you learn from Y Combinator essays. These are battle scars from actually working in the trenches.
The Yett model is counterintuitive as hell. Build in Lucknow where digital adoption is low. Focus on tier 2 cities where purchasing power is less. Onboard retailers manually through BD teams instead of self-serve SaaS. Make an AI chatbot that sends queries to human merchants. Every decision sounds wrong if you're optimizing for Silicon Valley metrics. But if you're optimizing for actually solving problems in the market you're serving, every decision makes perfect sense.
What's fascinating is how receptive older retailers were to adopting tech. Nikhil's BD team was surprised that 55-year-old shopkeepers who've been running businesses for 30 years were eager to get onboarded. Why? Because survival is built into their genes. They know the market is changing. They just needed someone who spoke their language instead of throwing SaaS jargon at them.
The advice for conventional business folks wanting to start tech companies is gold. Don't try to become a developer. Hire developers. Your domain expertise is your moat. A mechanical engineer who spent 16 years understanding distribution networks across UP and Bihar can't be replicated by a Stanford CS grad who spent 2 years at Google. Both have value. But only one actually understands why a shopkeeper in Varanasi makes buying decisions.
For anyone sitting in a metro thinking they need to be in Bangalore to build tech, Nikhil's story is your counterexample. Location matters, but not the way you think. Being in Lucknow gave him proximity to his market, understanding of shopping behaviors, and cost structure that lets him move slower and build deeper relationships. That's strategic advantage, not geographic constraint.
Q: How can people connect with you and try Yett?
Nikhil Sewak: You can download the Yett app from Yett.in. We're currently live in Lucknow with plans to expand to other tier 2 cities. If you're a retailer in cities like Agra, Indore, Nagpur, or Nashik and want to get onboarded, reach out to us through the app or connect with me on LinkedIn. We're always looking to work with businesses that value their local craft and want to reach customers beyond their street or neighborhood.
Final words: The next retail revolution won't come from algorithms that promise 10-minute delivery. It'll come from people who understand that in most of India, shopping is still a cultural activity, not a convenience optimization. Nikhil's not trying to replace physical retail with technology. He's using technology to amplify what physical retail already does well: build trust, showcase local crafts, and serve communities. While everyone's racing to build the next unicorn in metros, there's a massive, underserved market in tier 2 and tier 3 cities waiting for someone who actually understands them. Nikhil spent 16 years earning that understanding. Now he's building tech that respects it. Sometimes the best preparation for starting a tech company isn't learning to code. It's learning your market so deeply that tech becomes the obvious next step, not the impossible first one.