Bengaluru-based online lingerie startup Buttercups has raised an undisclosed amount of funding from Google India MD Rajan Anandan and angel investor Chandra Chappadi. Existing investors Kanwaljit Singh and Anand Chandrasekaran also participated in the round.
The investment was made through online deals platform, LetsVenture. With this, Buttercups’ total fundraise till date is believed to have reached $1.2 Mn (INR 7.6 Cr).
According to the official statement, the investment would enable the lingerie startup to pivot to a no-inventory model, while also moving manufacturing to India. Furthermore, the fresh funds will be utilised to introduce new ranges of bras in sports, maternity and nursing categories.
A newly-secured financing will also allow Buttercups to open two new fitting rooms in Bengaluru this year.
Commenting on the development, Buttercups founder and CEO Arpita Ganesh said, “We have always been clear about how we want to build the business. The quality of our products and delivering a great customer experience has been at the core of everything we do. We are now focussed on profitability – the zero inventory model and the pivot to India manufacturing, #MakeinIndia are bold steps towards achieving this by Nov-Dec’18.”
“The endorsement and support from seasoned investors like Kanwaljit, who is a strong believer in the power of Indian brands, gives us the confidence to continue this approach. Our flagship Fitting room at The Leela Palace is seeing a 90% conversion with ticket sizes as high as $39.4 (INR 2,500), giving us the validation that the experience and products speak for themselves,” Ganesh added.
Buttercups: Eyeing Profitability Through A No-Inventory Model
Buttercups was launched in 2013 by Arpita Ganesh. It is a culmination of Arpita’s decade-long experience within the lingerie space and her having fitted over 3,000 women. She constantly brings insights based on her understanding of the ever-evolving category.
The lingerie startup has pioneered the fitting room concept and using a multi-channel strategy for acquisition and retention, to creating a product line that revolves around design aesthetics and functionality, the brand has managed to build a distinct and sustainable advantage in the lingerie category.
As claimed by Arpita, Buttercups boasts up to 43% repeat customers. According to its filings with the Ministry of Corporate Affairs, Buttercups reported a revenue of $164K (INR 1.04 Cr) in FY17.
Buttercups had originally secured an undisclosed amount of Seed funding in June 2015, led by Kanwaljit Singh, Angie Mahtaney and others. In August 2016, the online lingerie brand raised fresh funding from Snapdeal’s ex-CPO Anand Chandrasekaran and existing investors Kanwaljit Singh and Manoj Varghese.
At the time, it was reported that the investment would help Buttercups to accelerate its growth plan as well as open its fitting rooms across 12 cities in India.
As per a report by Franchise India, the lingerie market in India is valued at about $3 Bn, growing at a CAGR of 42.32% between 2014 and 2019. Apart from popular brands like Amante, Enamor, Lovable, Rupa, Jockey, some new players have entered the segment to cash in on the booming ecommerce market in the country. In this space, Buttercups rivals against players like Zivame, Clovia, Prettysecrets, Cilory and Shyaway, among others.
Bengaluru-based online lingerie retailer Zivame pivoted to a private label business in September 2016 in order to improve its margins and thereby boost its revenues. In April 2017, Clovia raised $4 Mn in an extension of its Series A funding from current and new investors including Singularity Ventures and former BCCL CEO Ravi Dhariwal. Whether the startup’s latest pivot to a no-inventory model will help cut losses and enable it to hit profitability remains to be seen.