Thrasio Dilutes Stake In Lifelong Online – Its Only Ecommerce Bet In India

SUMMARY

Lifelong Online’s cofounders increased the stake in the startup to 60%, while existing investors, Tanglin Ventures and Hero Enterprise Partners, also upped their share

US-based Thrasio entered India by acquiring a majority stake in the online ecommerce brand for consumer goods, with plans to acquire more startups

The ongoing funding winter seems to have hit Thrasio’s India plans as the startup has not announced any new acquisition in India after Lifelong Online

US-based ecommerce roll-up giant Thrasio has diluted its stake in Lifelong Online Retail Private Limited, the only Indian startup in its portfolio, giving up the controlling stake in the consumer goods ecommerce brand.

The development comes almost 15 months after Thrasio entered India and acquired a majority stake in Lifelong Online.

In a statement, Lifelong Online said its founders Atul Raheja, Varun Grover, and Bharat Kalia have acquired a majority stake in the startup. Lifelong Online’s existing investors, Tanglin Ventures and Hero Enterprise Partners, have also increased their stakes in the brand.

The founders have increased their combined stake in the brand to 60%, sources told Inc42.

“Thrasio will continue to be an active investor and a strategic partner of Lifelong Online,” the statement said.

Lifelong Online said it will continue to focus on the Indian market and expand its product portfolio by entering into new categories.

Lifelong Online, founded in 2015 by Raheja, Grover, and Kalia, sells consumer durable products across categories like home & kitchen, lifestyle, fitness, and healthcare categories.

The startup slipped in the red in FY22. It reported a loss of INR 52.3 Cr during the year as against a profit of INR 10.4 Lakh in FY21. Its revenue from operations jumped 1.5X to INR 237.6 Cr in FY22 from INR 157.7 Cr in FY21.

Thrasio Reconsiders India Plans As It Fixes Its Home Base

Thrasio forayed into India in January 2022, just before the onset of the funding winter, with the acquisition of Lifelong Online. Thrasio then said it had a warchest of INR 3,750 Cr to fund acquisitions in the country.

However, the situation has changed drastically since then. Thrasio has not announced any acquisition in India after Lifelong Online.

Amid the global economic slowdown, Thrasio, which last raised funding in October 2021, reportedly fired 20% of the workforce in May 2022. The company even replaced its CEO Carlos Cashman with Greg Greeley in May 2022.

‘Thrasio-model’, the business model named after the company, revolves around acquiring third-party sellers, which sell on Amazon in the US, and helping them scale up further. The model became popular in India as well, with two such startups – GlobalBees and Mensa Brands – becoming unicorns. Other prominent Indian roll-up ecommerce startups like GOAT Brand Labs, Evenflow, Upscalio, 10 Club, and Powerhouse 91 also went on to raise capital and acquire businesses.

However, the ongoing funding crunch in the Indian startup ecosystem and the increasing losses of roll-up ecommerce startups seem to have brought the acquisition spree of these startups to an abrupt end. GlobalBees and Mensa Brands posted a loss of INR 41 Cr and INR 97 Cr, respectively, in the first year of operations.