Sleep and home solutions company Wakefit.co announced on Wednesday that it has raised Rs 185 crore in a Series B round of funding. Verlinvest, a large European investment firm with an AUM (assets under management) of €1.6bn focusing on consumer businesses, led the investment round, with participation from existing investor, Sequoia Capital India.
The Series B funding builds on an exceptional year for the direct-to-consumer (D2C) company, which recently expanded its product portfolio in home solutions, after four years of successful operations in the sleep solutions space. The complete range now includes furniture such as beds (cots), sofas, wardrobes, coffee tables and other furnishing. The investment is expected to further boost Wakefit.co’s penetration into non-metro areas of the country, with additional capex investment in machinery, manpower addition and factory setups on the cards. Technology and marketing bandwidth are also expected to see a significant boost within the company, to help capture India’s thriving home and furniture market.
The Series B round sets it on course to accelerate growth, with revenue targets of Rs 1000 crore by FY 2023. Wakefit.co, after setting up factories in Pune, Delhi, Jodhpur, Hyderabad and Bengaluru to strengthen logistics and bolster customer experience, will now look to double down on reaching Indians in Tier 2 and 3 markets. The company is also planning to set up experience centres in a few cities as a pilot, in response to growing customer feedback. The company has grown rapidly but profitably since inception, with revenue growing from ~ Rs 80cr in FY 2019 to ~ Rs 199cr in FY 2020 as per audited financial statements.
With a team strength of about 600 employees as of March 2020, Wakefit.co will also increase manpower across functions and create avenues to nurture Wakefiters in their respective careers. The company aims to increase its workforce by 400% to 3000 employees by March 2021 and has already started training programs for machine operators, carpenters and customer experience executives and will invest heavily in building stronger Learning & Development (L&D) modules within the company as part of its Wakefit Academy initiative to develop skilled manpower from the grassroots level.
As part of the funding round, the company has also instituted an ESOP buyback worth Rs 15 crore for the benefit of its early employees who have made significant sacrifices in the company’s journey. The company is also adding another 40-50 employees into the ESOP pool, demonstrating its belief of rewarding team members who provide commitment and tenure while growing with the company.
Ankit Garg, CEO and Co-Founder of Wakefit.co said, “The investment consolidates Wakefit.co’s position as the fastest growing D2C (direct to consumer) brand in India. Given that the company has been profitable from an early stage – a rarity in the startup world – our focus has always been on high growth while maintaining strong business fundamentals. Our product innovation and customer centric DNA has enabled us to achieve our growth targets year on year. The latest funding round will help us touch more lives and penetrate deeper into the Indian market.”