Online merchandise store Bluegape has shut down its merchandise business due to copyright issues.
Started by students in 2012, Bluegape raised angel funding in 2012 and raised INR 1.5 crores in January, 2014.
Cofounder, Sahil shares that the company was recording a monthly revenue of INR 1 crores, but their focus on Fanart is leading to copyright issues.
Currently, Fanart accounts for more than 70% of revenues for Bluegape and since Bluegape has mostly been retailing at Amazon, Snapdeal and Flipkart, these ecommerce companies probably blocked them due to several questions around copyright raised by artists (case in point : Flipkart too received few notices on the sales of fanart on their website).
Bluegape’s Email To Fanstore Owners
“Dear Fanstore owners,
We are facing a lot of challenges in running the merchandise business in India. While we are doing a healthy business of a crore+ per month of revenues, but we are stuck at something.
Indian copyright act is very unclear on the sale of fanart. Fanart is like creation of something from the inspiration from somewhere. All our 500+ designers were making crazy stuff with us and we were proud of that.
We built a simple model where we focused on bringing designers and retail them through flipkart, amazon and snapdeal.
Flipkart and Amazon have got few notices on the sale of fanart on their website. AlthoughSociety6.com is a very big company in Australia and retails designer driven fanart. But they take down the designer when there’s any notice from anyone.
In our case, we didn’t have that freedom because we were retailing at Flipkart, Amazon and SnapDeal. Flipkart and Amazon don’t want to take any risk by retailing fanart on their website. There’s a lot of negative media going on in e-commerce and no one wants to take a bet on this.
Under all these problems, it’s getting super tough to continue the merchandise business as fanart is more than 70% of the total sale. We discussed the issue in length with Flipkart & Amazon in last one month and we are unable to reach to a solution.
We want to pivot at this point. Trust us, after spending 3 years doing merchandise business, It’s been a really tough call for us.
All of your due fanstore payouts will be cleared on 7th December,2014.
I know it would have been really hard for you to read this email. I appreciate the kind of trust and confidence that you have shown in bluegape.
Sahil and Ayush”
The founding team however is sticking together and is working on another idea under the brand name, Bluegape.
Here is wishing the team very best!
– Thanks Vijeeth for the tip.