Furlenco, an online furniture rental platform, has raised around $30 million in its latest Series B round of funding. The round was led by existing investor of the company — LightBox Ventures.
In addition to equity funding, the latest round also comprises of a significant debt component. As per the reports, out of $30 million, $15 million is from equity and another $15 million is pure debt.
For this, the company has raised debt funding from HDFC Bank, the country’s largest private sector lender, and Axis Bank. Along with those banks, it has also raised money from non-banking financial company IntelleGrow and a number of undisclosed family offices and high net-worth individuals.
As for equity funding, it comes from the company’s existing investors — Furlenco Capital and Lightbox Ventures. However, a new investor, Hong Kong-based multi-stage venture capital firm Axis Capital Partners, has also participated in this round.
Sid Talwar, partner at Lightbox Ventures, said,
A year ago, we couldn’t have imagined a company so young would have been able to raise so much debt, especially on the back of an asset like furniture. This is monumental and speaks volumes of the kind of business Furlenco has been building from the very beginning.
This marks the third investment from Axis Capital Partners in India. Earlier, the company had invested money in fin-tech venture uTrade and online marketplace for used automobiles and auto services Droom.
With new capital coming to the company, it now plans to spend money on designing new furniture, technology expansion, and to expand its operations into new cities. It aims to “being the best design company in the country.”
Ajith Mohan Karimpana, founder and CEO of the company, said,
For us to grow, we need more furniture and that furniture has to be funded. Previously, we put all our equity money into furniture and proved that this (furniture rental) asset class works. People should be able to accept our offering, pay us on time, and with that money we should be able to run our company and generate cash to prove to the debt folks that this business works. We did all of that.
We don’t have to start our selling process from zero every time. We have a subscription-based model. I already have a set of customers from last month and before, who are paying me rent every month, which I can use to service debt. This gives debt guys confidence. It is all a bet on the past.
Founded in 2011, the company claims to service about 2,000 bookings every month, with an average ticket size of Rs3,000. It had raised $6 million from LightBox Ventures in a Series A funding round in March last year.