Bengaluru-based online interior design startup Design Cafe has raised an additional $25 Mn (about INR 166 Cr) in its extended Series B round, led by existing investors WestBridge Capital and Fireside Ventures. Sixth Sense Ventures and new family offices also participated in the round, taking the total series B funding to $53.5 (about INR 366 Cr).
The funds will be utilised to expand its presence in the top 10 cities including new places such as Chennai and Thane, and its existing market base in Delhi, Mumbai, Hyderabad. The startup plans to grow its gross annual booking rate to INR 600-700 Cr over the next 24 months, with more focus on its growth in the Home segment.
“We are on the cusp of change in India’s home interior and improvement space and are excited to work to build a brand that will impact the entire ecosystem in a meaningful way. This includes providing better homes to customers and greater opportunities to designers and trade professionals,” Design cafe cofounder Shezaan Bhojani stated. “The funds raised will allow us to take our services and products to more markets, and invest further in technology and people.”
Founded in 2011 by Gita Ramanan and Shezan Bhojani, Design Cafe has previously raised $25 Mn in series B round in 2018, to fund expansion to Mumbai, Delhi-NCR and Hyderabad. Inc42 also exclusively reported that the startup raised INR 24.99 Cr in a bridge round in 2020.
The startup, which was a traditional design company until 2015, is now an online marketplace of its designers, workforce, and a factory in Bengaluru manufacturing all its products.
In the online home interiors space, Design Cafe competes primarily with MS Dhoni-backed Homelane, which recently raised $50 Mn in a Series E funding round led by IIFL AMC’s late-stage tech fund, OIJIF II (Oman India Joint Investment Fund) and existing investor Stride Ventures. Other players in the home decor and interior design space are Livspace, Urban Ladder and Pepperfry.
Design Cafe claims to be nearing break-even, with an annual revenue run rate (ARR) of INR 180 Cr.
Since the onset of the pandemic, there has been a dramatic change in the buying pattern as people prefer to order everything — from food to furniture – online. The global online home decor market, which was valued at $98.4 Bn in 2020, is projected to rise to $348.3 Bn markets by 2030.
Of the $98.4 Bn global markets, India is a $20 Bn unorganised and fragmented market with an expected CAGR of 7%. Similar growth is being projected in the Indian online furniture interiors market too.