SoftBank May Invest $200Mn In Baby Care Startup FirstCry

Japanese conglomerate SoftBank is reportedly exploring a $200 Mn investment in Pune-based online baby products retailer FirstCry.

The investment is expected to value FirstCry at nearly $800 Mn- $900 Mn, a nearly 100% increase from its current valuation of $350 Mn.

In an earlier media report this year, FirstCry was also said to have revived its talks with Temasek Holdings, Chinese Internet giant Tencent and another Chinese investment firm for the next round of fundraising.

Speculations are also rife that Morgan Stanley was appointed as the investment banker for the said deal. However, FirstCry and Temasek talks didn’t reach any consensus over the valuation issues.

The SoftBank investment looks part of the same deal, as Morgan Stanley continues to be the investment banker for FirstCry.

Founded by Supam Maheshwari and Amitava Saha, FirstCry began its operations in 2010 to offer different categories of Baby and Kids products from clothing to school essentials etc from global brands like Funskool, Hotwheels, Nuby, Farlin, Medela, Pampers, Disney etc.

Since inception, the company has expanded its parent base to over 4 Mn and a footprint of over 300 stores spread across 125 cities.

Till date, the startup has raised more than $100 Mn and is backed by investors such as IDG Ventures India, SAIF, Valiant Capital, Ratan Tata, Vertex Venture, and NEA. At the time of raising last funding in October’17, FirstCry also acquired BabyOye’s franchise business from Mahindra for $54 Mn.

SoftBank denied commenting on the development to Inc42.

Baby Care: The New Booming Ecommerce Segment

According to a Technavio report, the Indian baby care market is expected to grow at an annual rate of over 17% in terms of revenues during the 2014- 2019 period to reach over $31 billion, from $14 Bn.

Here’s a quick look at some of the players in the space:

• Amazon Fashion launched a dedicated online baby clothing store to offer 100K styles for babies up to two years of age
• Mumbai-based online parenting platform Babychakra raised an undisclosed amount of fresh funding from a group of senior corporate leads
• Gurugram-based mother and baby care startup MamaEarth raised $4 Mn in a Series A round of funding led by Stellaris Ventures
• Parenting social network startup Healofy raised $1 Mn in a seed funding round from Omidyar Network

A report by RNCOS, a business consulting service firm, forecasted that India’s baby care market is expected to post a CAGR of over 15% during 2015-2022.

SoftBank: Betting Big On India

SoftBank has been making big bets in India, catapulting startups into the much-coveted unicorn club.

It earlier made a $238 Mn investment in PolicyBazaar and a $1 Bn investment in hotel aggregator OYO, valuing each of them at over $ 1Bn.

Recently, SoftBank was looking to invest $200 Mn-$250 Mn in ecommerce logistics startup Delhivery to take it to Unicorn club.

At the same time, SoftBank Vision Fund is examining its investment in either of the two foodtech unicorns— Swiggy and Zomato as well.

With SoftBank reaping big returns from its investment in ecommerce giant Flipkart after acquisition by global retailer Walmart, the company’s increasing trust on Indian startups looks a promising idea for the Indian startup ecosystem.

[The development was reported by ET.]