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FirstCry Looks To Acquire Online Sellers, D2C Brands With $75 Mn Investment Fund

FirstCry Looks To Acquire Online Sellers, D2C Brands With $75 Mn Investment Fund

FirstCry will launch an investment venture entity called Global Bees to track and acquire D2C brands

Global Bees will seek to acquire 30-40 D2C brands across categories

It will invest $2 Mn-$6 Mn per brand acquisition with capital raised from SoftBank, TPG and other investors

Pune-based kidswear ecommerce unicorn FirstCry is set to launch India’s largest Thrasio-style investment venture for D2C brands and online sellers, with $75 Mn earmarked for capital commitments. The company is raising capital from investors such as Japan’s SoftBank, TPG, ChrysCapital and Premji Invest, according to reports.

The investment venture entity is likely to be called Global Bees, as per an ET report and will look to acquire brands or sellers, or help them accelerate sales and revenue through ecommerce marketplaces in India.

The model is similar to Thrasio, the Massachusetts-headquartered ecommerce company, which is valued in the range of $3 Bn-$4 Bn. Thrasio came to prominence in 2020 as it consolidated third-party sellers on Amazon in the US. Launched in 2018, it has acquired nearly 100 third party sellers or fulfilled by Amazon (FBA) businesses and claims to provide better economies of scale to manage and grow those acquired businesses. It reviews the “top-reviewed, bestselling” essential product charts on Amazon, and looks to acquire the brands from small business owners. 

On a similar note, Global Bees will look to acquire 30-40 D2C brands across categories, beyond kidswear and children-specific segments. It will deploy the funds over the next 3-4 years, investing $2 Mn-$6 Mn per brand acquisition or investment. Besides acceleration for sales, the entity is promising deep consumer insights from FirstCry founders and investors. This includes marketing and branding support, warehousing and logistical solutions, and product development knowledge. 

Global Bees is reported to be headed by Nitin Agarwal, the former president and group CIO, CTO and chief digital officer at Edelweiss Financial Services. While his appointment has not been confirmed, Agarwal quit Edelweiss In April 2021, as seen in his LinkedIn bio. His profile said he is currently building something new. 

According to Inc42 Plus data till March 20, 2021, Indian startups raised $2.7 Bn from 268 funding deals. Ecommerce was the top-funded sector at $520 Mn and ranked third in terms of deal count with 33 deals. An Inc42 Plus report, titled, Indian Tech Startup Funding Report Q1 2021, shows that D2C and vertical ecommerce startups are fuelling investor confidence in the ecommerce ecosystem. More importantly, between Q1 2020 and Q1 2021, the funding amount for D2C startups has registered a 93% average quarterly growth.

Founded in 2010 by Supam Maheshwari and Amitava Saha, FirstCry is primarily a baby and kidswear ecommerce platform. It claims to have over 4 Mn users, and has a retail footprint of over 300 stores spread across 125 cities. 

Last year, the company raised $296 Mn in Series E funding from Softbank Vision Fund to enter into the unicorn club. SoftBank has committed a total of $400 Mn, as per filings. Till date, the company has raised total funding of $428.4 Mn across multiple rounds. 

Last month, FirstCry raised INR 95 Cr ($13 Mn) in an equity funding round from pi Ventures through its opportunity fund I, at a valuation of $1.9 Bn or INR 14K Cr. Meanwhile, FirstCry’s early investors, including Chiratae Ventures, Vertex Ventures and SAIF Partners (now known as Elevation Capital) were reportedly looking to sell about 7%-9% of their individual stakes in the company for $180 Mn in a secondary transaction.