India has one of the fastest growing startup markets in the entire world, thanks to the country’s cheap data rates and massive population. However, for some reason, hardware related startups have failed to captivate the audience in the way Paytm, Zomato, and other software related companies have. The exception to this rule, of course, is boAt, a startup that offers budget friendly products with a premium feel and has managed to become a household name in just a short while. Today, the startup has managed to out do all the other players in the market and raise $100 million, a feat that no other Indian hardware startup has been able to achieve.
The entire Series B financing round was founded by Warburg Pincus, a New York-headquartered private equity firm. Before this round, the company had raised just $3 million in equity and debt financing. Sources tell TechCrunch that the startup may have been valued at about $300 million in the Series B.
“We welcome Warburg Pincus as a new investor into the company. This is a vote of confidence for our business model and growth prospects. The investment is great news for not only the company but for the entire D2C sector. The investment has come at the right time as we make efforts to ramp up our manufacturing and global supply chain”, Aman Gupta, Co-Founder, boAt said.
boAt was started in 2016, and has managed to penetrate the Indian market unlike any other startup in the same category. Thanks to it budget friendly devices that feel premium, boAt has been able to grow profusely year-over-year, and has managed to clock $97 million in revenue in 2020.
While the company started out with charging cables and adapters, it has expanded over the years to offer a wide array of products-from earphones and headphones to wireless speakers, fitness wearables and of course, charging cables. The mantra, however, has remained the same-offer premium devices at a low price point. This has allowed the company to become a favorite for the average Indian, who wants to keep changing his electronics every few months.
Moreover, boAt was also one of the first companies to take the ‘influencer’ route to marketing. Instead of running the traditional ad campaigns, it paid influencers and young celebrities to promote its products. Most of the items it offers are catered towards the young, who are more susceptible to social media marketing campaigns than anything else. Suffice to say, the strategy seems to have worked fairly well, and has set the precedent for many other companies.
The company plans to use the new capital to shift more of its manufacturing from China to India, and add products to its catalogue, the founder Sameer Mehta said.
“We see a compelling growth story in boAt and believe the company is well-poised to build upon the strong leadership position it has carved out within the industry and stands to benefit from the secular tailwinds of e-commerce growth in India. Warburg Pincus is excited to partner with the management team of boAt led by Aman & Sameer in this journey and we look forward to supporting them through the next phase of the company’s growth,” said Vishal Mahadevia, managing director and head of Warburg Pincus India, in a statement.