Furniture rental startup Furlenco, on Thursday (April 1) announced a $10 Mn funding round with participation from its existing investors. The startup said that it has raised the funds in a mix of debt and equity with the round beginning in November 2019.
Venture capital companies Lightbox and Dabur scion Saket Burman have participated via equity financing. On the other hand, high-net-worth individuals (HNIs) including former Infosys chief Kris Gopalakrishnan, former partner with Tata Capital Gautham Radhakrishnan, among others have picked debentures as part of the transaction.
Further, Bollywood actor Aamir Khan, who is an existing backer of the startup, has also invested in this round. For this funding round, Waterfield Advisors, DPNC Advisors, and Quadito were the advising partners to Furlenco.
Furlenco’s founder and CEO Ajith Mohan Karimpana told ET that the company is already operationally profitable. The funding will help the company to achieve its goal of becoming fully profitable in the next 12-18 months, Karimpana added.
The company has closed this funding round at a valuation of $125 Mn. So far, the startup has raised around $43 Mn in equity and $45 Mn in debt. Out of this, the startup claims to have settled $20 Mn worth of debt.
Furlenco was founded in 2012 by Karimpana. The online subscription-based furniture rental platform currently operates in Bengaluru, Delhi/NCR, Hyderabad, Chennai, Mumbai, and Pune. Since inception, the platform has served over 110K customers.
Staying Afloat Amid Coronavirus Slowdown
In the wake of coronavirus, many startups are facing disruptions in their operations. But that’s not the case with Furlenco, according to Karimpana. He said the revenue model has kept it afloat during the slowdown with monthly subscription collected as usual from customers.
Karimpana said that the ongoing Covid-19 pandemic has definitely impacted some parts of the business but not the revenue. “Furlenco’s subscription business model with monthly recurring revenue allows us to be a lot more resilient than many of the other startups who are seeing their monthly revenues plummet significantly,” he added.
In India, the furniture industry is currently valued at around $18 Bn (INR 1,294,06 Cr). Out of this, around 85-90% of the market is dominated by unorganised retailers. However, online rental platforms like Furlenco are changing the landscape. Other startups which are either selling or renting furniture online include Urban Ladder, Furlenco, and Pepperfry. All these players are estimated to be catering to just 2% of the market.