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Online mattress start-up Wakefit Innovations Private Ltd has received ₹65 crore, its first external funding, from Sequoia Capital in exchange for 31.9 per cent of equity.
Post the investment, the bootstrapped start-up’s founder and CEO Ankit Garg will hold a little over 50 per cent stake (50.1 per cent) in the company he co-founded in 2015 along with Chaitanya Ramalingegowda, as per RoC filings accessed by BusinessLine .
The investment by Sequoia puts the company’s valuation at about ₹200 crore. In financial year 2017-18, Wakefit’s revenue stood at ₹27.6 crore and net profit at ₹2.2 crore, up from ₹6.7 crore and ₹ 36 lakh the previous year. The company turned profitable in July 2016, just six months after it started shipping to customers. Confirming the development, Ankit Garg told BusinessLine that 10-15 per cent of the funds will be invested to automate manufacturing to increase the production capacity from 250 mattresses per day to 700 mattresses per day.
New products such as bedsheets made out of wood pulp thread,comforters, pillows and sleepwear will also be launched. “The bulk of the funding will go into educating customers on what it takes to get a good night’s sleep, which is very important. Today, visitors to our site spend at least 5 minutes browsing and going through all the content on the site; we want to further improve on the amount of time they spend on our site” he said.
A thriving market
Sunday, another online start-up, is also in talks to raise between ₹40-80 crore from financial investors and strategic investors (mattress brands).
The company had turned profitable in fiscal 2017, just 18 months after it began sales.
The $3 billion Indian mattress market, 30 per cent of which is catered to by the organised players, is growing at 10-15 per cent annually. It is estimated to grow at 20 per cent in the next few years as a whole new generation of millennials get ready to set up their homes.
The market is predominantly offline and dominated by Sheela Foam (Sleepwell) and Kurlon.
Apart from Sunday and Wakefit that dominate the country’s online mattress market, at least 25 players have entered the space including Wink Nod, Nubliss, Sleepy Cat, Durfi, Flo and Springtek.
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