Exclusive: Urban Ladder Issues Warrants To BCCL, Gets Fresh Funding

Bengaluru-headquartered furniture etailer company Urban Ladder has received fresh funding from investors and has made a new allotment to Bennett Coleman and Company Ltd (BCCL).

According to the Ministry of Corporate Affairs filings accessed by Inc42, the company on March 18 approved to allot and issue 1 equity share and 5 warrants to BCCL. Of this, the amount of 1 equity share at a nominal value of INR 1 with a premium of INR 17849 per share worth INR 17850 came in on March 31.

Further, the share warrants have been issued at a value of INR 97.5 Lakh. For the uninitiated, a share warrant gives the holder the right to purchase a company’s stock at a specific price and at a specific date. This is mostly a pre-decided investment, where now they have invested in equity on the pre-decided amount.

Also, the company received Series E funding on April 8. The investments were made at a nominal value of INR 20 with a premium of INR 17830 per share worth INR 7.97 Cr. For this:

• SAIF picked up 1490 Series E shares worth INR 2.65 Cr
• Kalaari picked up 1490 Series E shares worth INR 2.65 Cr
• Sequoia 1490 Series E shares worth INR 2.65 Cr

The company said funds will be used for business requirements. Founded in 2012 by Goel and Srivatsa, Urban Ladder is an omnichannel furniture retailer with over 3K custom-designed products across 35 categories selling in more than 90 cities in India, with offline stores in Bengaluru and Delhi-NCR. It has previously raised $112.8 Mn from investors such as Kalaari Capital, Steadview Capital, Trifecta Capital etc.

The company had announced a shift in its business model from online retail to a furniture brand in July 2017. The new business model saw the company partnering with bigger ecommerce players in the Indian market such as Amazon and Flipkart.

It had said that its omnichannel strategy has increased the average order value (AOV) by 24% along with lowering its customer acquisition costs (CAC) by 43%. It has also optimised other channels on its path to profitability and omnichannel expansion.

As a result, in FY19 earned revenues of INR 434 Cr — a 1.87X growth as compared to last year. With the strong growth in revenue, the company has narrowed down its expenses by 64% and has hence turned losses of INR 118.66 Cr of FY18 into profits of INR 49.4 Cr in FY19.

In a recent report titled ‘Shared Economy – India Story’, Maple Capital Advisors stated that the sharing economy in India is poised to become a $2 Bn industry by the end of 2020 from $1.5 Bn in 2019, which includes rides as well as goods and real estate. The report attributed this increase majorly to high mobile penetration, high millennial concentration, and an aspirational population. “Asia has the highest willingness to use shared assets. India mirrors Asia trends in these aspects and is thus, poised for high growth and adoption of shared services,” it added.