Check Out the New Venture Capital Trend – Online Furniture
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With problem-solving being the focal point, it now seems that the latest round of venture capital (VC) investments have taken the Indian funding scene to an all new level and to sectors that remained marginally addressed. The newest investments represent a round in which Bengaluru-based furniture rental startup raised INR 5 crores to potentially upgrade infrastructure and further operations to other Indian cities.
Solving the Problems of the Indian Middle Class, On the Go
Furniture rentals in India definitely seem unconventional considering the fact that people still prefer buying new furniture and disposing them when they tend to move out of a place or feel dissatisfied with the furniture itself. This is where startups like Furlenco come in; offering rental plans from INR 999 a month.
This means that buyers get to enjoy furniture, from Furlenco which claims to deliver quality stuff, till the period that they want to and ship the same back to the startup post usage.
Furniture rentals potentially solve the pain-point for working professionals having relocated to different Indian cities temporarily for work. These are people wanting to set-up interim bases close to workplaces, and aware of the fact that they would be moving out in the future. Therefore, purchasing furniture to suit such ‘temporary’ needs may not be the ideal choice after all. The ‘use it till you want to’ approach should save the hassles of not finding the right selling price.
Latest Venture Capital Funding Represents a Paradigm Shift
First things first, as per CrunchBase, Furlenco managed to raise INR 5 crores from Signet Chemical Corporation which was also an existing investor at the furniture rental startup. At this instant, it is also worth noting that Furlenco has managed to grab the attention of as many as 6 investors in total, and the startup also underwent Series A and Series B in 2015 and 2016 respectively.
The latest round of funding takes the total amount of capital, raised by Furlenco, to nearly $39 million, with investors such as Bollywood actor Aamir Khan also funding $300,000 in 2017.
Furlenco’s funding trends are a diversion from venture capital investment trends focussed on core technology, healthcare, agritech, and smart cities after Indian PM Narendra Modi came out with a slew of reforms such as Make in India and Digital India to boost startups in the country.
With ventures focussing on cliché aspects such as furniture rentals, also finding celebrity investors “(Aamir Khan) and potentially attracting the biggie VCs in India such as Sequoia, and Accel, the opportunities for investment of VC capital in these ‘unconventional’ sectors are huge.
Also, leading VCs have started to believe that startups solving issues that could easily be forgotten such as having furniture cleared out when you shift locations, could represent the next set of opportunities to invest in and mentor.
VC Investment in Furniture Rental Startups – the Trend
At this instant, it is worth noting that apart from Furlenco, investors viz. Goldman Sachs, Norwest Venture Partners, and more have already pumped in significant capital to Indian furniture service startups. In this regard, check out some of Furlenco’s competitors (in terms of VC investments) below:
- Pepperfry: This venture lets people buy furniture online. Unlike Furlenco, Pepperfry does not offer rentals. Pepperfry was founded in 2011 by Ambareesh Murthy and Ashish Shah in Mumbai, and the startups’ latest funding has been a Series E which oversaw investments worth $31million led by Goldman Sachs. Total capital raised by Pepperfry amounts to more than $150 million thus far.
- GoZefo: This Bengaluru-based startup, founded by Himesh Josh, Arjit Gupta, and Rohit Ramasubramanian, has thus far managed to raise $16.2 million in investments predominantly from Sequoia Capital and Helion Ventures. Zefo lets people purchase and sell used furniture online. Zefo’s most recent funding was a Series B in 2017.
- Livspace: Livspace lets people fulfil their furnishing needs, for homes, online. The venture, founded in2 012, enables users to purchase furniture whilst choosing home designing trends from its platform. Livspace is backed predominantly by Bessemer Venture Partners who were the lead investors in the startup’s Series B in 2016. Till now, Livspace has raised nearly $28 million capital.
Finally, the above represent emerging trends as far as ventures (and their raised capital) in the online furniture services domain in India is concerned. If you have a great idea to diversify your portfolio, taking a look at the above should definitely do a world of good.