By the end of CY2019, Pepperfry secured more than $200 Mn while Urban Ladder only crossed the $100 Mn mark.Īccording to him, when Urban Ladder started looking for a buyer in 2019, it targeted a deal value of INR 300 Cr or so, to be mostly paid in cash. “Internally most of the investors knew this, especially as the company was not able to raise more funding than its direct competitor Pepperfry,” says one of them, requesting not to be named. Two industry executives, directly aware of Urban Ladder’s acquisition talks, have told Inc42the startup was looking for a buyer for the past one year and a half. However, much of this valuation started to erode towards FY2019, way before the company entered into talks with RIL. This was slightly higher than its approximate valuation of INR 750 Cr, reached during the earlier funding round in February 2017. On paper, the online furniture retailer had a valuation of INR 780 Cr at the time of its equity fundraising in September 2018. The financials and the change in post-money valuations over the years would further explain the scenario. His exit came a day after Kalaari Capital’s Vani Kola resigned from the board of the company. In October last year, just months before a devastating pandemic swept the world, Srivatsa said in a press statement that his eight-year journey with Urban Ladder would come to an end. Several cracks started to appear in the firm’s business, including layoffs, and the exit of its cofounder Rajiv Srivatsa. #Ikea pricetracker Patch#In fact, the furniture e-retailer went through a sticky patch throughout 2019. In November 2019, it managed to raise INR 15 Cr although some of its existing investors did not participate in the round. #Ikea pricetracker series#The company closed its Series E round two years ago but struggled to get funding after that. In contrast, Urban Ladder, which has been around since 2012 and built a much-coveted private label, took a 75% cut in its paper valuation when the Mukesh Ambani-led retail behemoth acquired it.Ī closer look at its funding history and past valuations are bound to make both entrepreneurs and investors slightly jittery.įounded in February 2012 by IIM-Bangalore graduates Ashish Goel and Rajiv Srivatsa, the company raised around $120 Mn from top venture capital funds such as Sequoia Capital, SAIF Partners, Kalaari Capital, Ratan Tata’s VC fund, and a hedge fund called Steadview Capital. Think, for a moment, how a billion-dollar edtech startup shelled out $300 Mn to acquire a smaller company within 18 months of its launch. Unlike other exits in the consumer internet space in 2020, this is no run-of-the-mill acquisition. But all that is history now unless we are ready to take a deep dive into the buyout and analyse the outcomes. The RIL unit may also acquire the rest of the stake by December 2023 for another INR 75 Cr. On November 14, Reliance Retail Venture Ltd (RRVL), a subsidiary of Reliance Industry Ltd (RIL), announced an all-cash buyout of 96% stake in the company for a little over $24.5 Mn (INR 182.12 Cr). And the latest to hit the headlines is the acquisition of Bengaluru-based online furniture retailer Urban Ladder Home Decor Solutions. The deal market is awash with news in spite of the Covid-19 slowdown. Urban Ladder’s exit story is another example of inflated valuation and the consequent erosion of investor wealth. Urban Ladder’s management gave up more than half of its valuation after the acquisition by RIL, but the retail behemoth was not the only suitor in the fray RIL’s recent acquisition of majority stake in Urban Ladder may look unfavourable for investors, but for the founders and the brand itself, it was a fire sale
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