Mumbai-based online furniture and home products marketplace Pepperfry has raised INR 35 Cr ($4.8 Mn) of debt funding from InnoVen Capital, which had first invested in the company back in 2017.
Commenting on the same, InnoVen Capital India’s senior director Sameer Mansukhani said, “We have seen Pepperfry grow and emerge as a category leader, while adding new capabilities and product offerings on its platform. They have built a strong brand and this investment reaffirms our commitment to back high performing portfolio companies across their life cycle.”
The latest funding comes as Pepperfry claims to be reporting significant growth in the past months with improved economics for the business. While the facts of this growth will only be revealed once the company reports its financial statement for fiscal year 2021, but we do get a glimpse of it in its FY2020 statement.
According to the regulatory filings, Pepperfry has managed to cut down its losses by 33% to INR 122 Cr in FY20 from INR 183.49 Cr in FY2019. The company’s revenue also increased by 26% to INR 260.62 Cr, with INR 246 Cr coming in from operations. The furniture products marketplaces’ expenses dropped marginally by 1.79% to INR 383 Cr.
Founded in January 2012 by Ambareesh Murty and Ashish Shah, Pepperfry has raised about $240 Mn funding till date from marquee investors like Norwest Venture Partners, Bertelsmann, Goldman Sachs, State Street Global Advisors. The company last raised $40 Mn, last February, from Pidilite Industries, which makes the Fevicol lineup of products.
The Mumbai-based startup had opened its first studio in December 2014. Currently, it has 67 such studios, including both owned and franchise, across 24 Indian cities. In the second half of 2019, Pepperfry opened 25 new Pepperfry Studios. Now, the company plans to open several 500 sq ft virtual reality studios, where customers can walk in, choose a room layout and view how products will look in that room on a VR headset.
According to Statista, revenue in Indian’s furniture and homeware market is expected to show an annual growth rate (CAGR 2021-2025) of 8.7%, resulting in a projected market volume of $2,131 Mn by 2025.
Pepperfry competes with several other startups in the online furniture industry such as WoodenStreet, Wakefit, Furlenco, Rentomojo and HomeLane, along with ecommerce marketplaces such as Amazon and Flipkart.
Among the competition, Furlenco raised INR 20 Cr ($2.7 Mn) in a venture debt funding round from Blacksoil Capital last month, whereas HomeLane has raised $30 Mn ($218 Mn) from Stride Ventures and exisitng investors in August 2020. In December last year, Wakefit, which entered the furniture category in 2019, raised INR 185 Cr (around $26 Mn) in its Series B funding round from Verlinvest, along with participation from existing investor Sequoia Capital India. With this round, Bengaluru-based D2C startup’s valuation shot up to INR 1,900 Cr (roughly $258 Mn) from INR 220 Cr (approx $31 Mn) when Sequoia had invested INR 65 Cr in December 2018.