Bengaluru-based Thrasio-style ecommerce player 10club has acquired three gardening startups namely Kraftseeds, Gate Garden and Kriti Kalash. The D2C roll-up brand has also announced ‘Home’ category as one of its key focus areas.
Founded in 2020, 10club partners with ecommerce product sellers in India by acquiring their businesses and working with their teams to help them grow 10x in size. The ecommerce acquirer was cofounded by Bhavna Suresh (former CEO, Lamudi), Joel Ayala (cofounder, Class 5 Global), and Deepak Nair (former cofounder, 22feet).
10Club aims to build a valuable portfolio and elevate the entrepreneurial ecosystem within the country. It offers ecommerce sellers a financial exit while aiding the business with the right kind of resources to help them scale.
Earlier this year, it raised India’s largest seed round of $40 Mn from Fireside Ventures, HeyDay, PDS International, Class 5 Global, Secocha Ventures and boAt founders.
Betting Big On The Home Category With Kraftseeds
“Keeping a sharp eye on new or even dormant trends is critical for a business as it needs to adapt fast to retain its customer base,” Suresh said while speaking at the first edition of Inc42‘s The D2C Summit 2021.
The acquisition of Karatseeds, Gate Garden and Kriti Kalash gives 10Club, a strong foothold in the lawn and gardening, as well as in the home category.
“More importantly, [they] will complement the six new acquisitions that we will announce shortly. With these acquisitions, we will be clocking a revenue of more than $50 Mn in the home category alone,” Nair said in a statement.
Founded by Gaurav and Shaina Pahwa, Delhi NCR-based Kraftseeds is a one-stop online shop that provides a wide range of gardening products from seeds to pots to manure and tools. Kraftseeds has been in the gardening business for over two decades with a family of 100K+ customers.
It is also currently the top brand for gardening tools and seeds on Amazon, with over 3,600 SKUs on the platform. Kraftseeds runs two subsidiary brands — Gate Garden for exotic seeds & gardening tools, and Kriti Kalash for pots.
Kraftseeds boasts exceptional expertise in sourcing seeds, a strong network with farmers, customised seed varieties, seasonality, volume, and specific quality standards among other factors. Over the years, they expanded their product lines to include planters, soil and coco peat, gardening tools and flower bulbs.
Through the acquisition, 10club aims to carve out niches for each brand — from structuring their product mixes to their pricing models. This will enable three unique brands and offerings a spin-off from Karatseeds through a centralised platform.
Also, channel expansion through Jiomart, Meesho and Flipkart will also play an important role, boosting growth.
10Club aims to build a strong brand identity for Kraftseeds, carving a niche in the garden category.
The Changing Face Of D2C In India
D2C brands, business models and platforms are arguably the biggest game-changer in retail since ecommerce with an expected market size of $100 Mn by 2026.
In the first seven months of 2021, Indian D2C startups raised $783.7 Mn — 251% higher than all of 2020. The influx of capital has not only resulted in thousands of new brands but also introduced disruptive models such as ecommerce roll-ups, houses of brands and more while giving enablers and digital sellers new opportunities to grow.
10Club is one of the many Indian startups that acquire and scale fast-growing digital brands. Just like Thrasio, the US-based company that pioneered the concept of offering complete household health. Hence the moniker—‘Thrasio-style’.
Other companies with a similar business model in the country include UpScalio, Globalbees, Mensa Brands, Evenflow, Powerhouse91, CureFoods among others.
For D2C startups, looking to enter the global market and venture beyond India, becoming a part of a bigger house of brands or an ecommerce roll-up offers a faster scale-up. The feeling is that D2C brands that have the slightest bit of momentum can become a target for acquisitions by such platforms.
If not in late 2021, then at least by 2022, such models should become more and more prominent in the market.
One of 10Club’s major competitors Mensa Brands also recently became the fastest unicorn in Asia, within 6 months of its launch. Mensa Brands has acquired majority stakes in 10 D2C startups as of now.
Another Thrasio-style platform Globalbees had raised $150 Mn in Series A funding in July this year, with plans to invest in 20-40 D2C brands.
While Globalbees acquired two brands this year, Thrasio has earmarked $500 Mn for a foray into the Indian market and has already completed its first local acquisition. This includes Lifelong Online which offers products across the kitchen, grooming and lifestyle categories.