Craftsvilla.com, a pioneer in marketing ethnic products online, founded by Manoj Gupta, an MBA (PGPX) from IIM Ahmedabad, has raised $34 million (Rs 220 crore) in the latest round of financing.
Gupta, who was earlier with venture capital firm Nexus, had in 2011 decided to join the e-commerce bandwagon as an entrepreneur.
The latest funding round saw existing investors Sequoia Capital India and Lightspeed Venture Partners along with Russian internet billionaire Yuri Milner participating with the latter putting in $5 million through DST Global partners’ fund.
Gupta, Co-Founder and CEO, Craftsvilla told Times of India that his company was aiming at going public in the next 12-18 months, despite the fact that most e-commerce majors have put their IPO plans on hold
Craftsvilla’s other existing investors Nexus Venture Partners and Global Founders Capital, a VC fund founded by Rocket Internet’s Samwer brothers, were also part of the latest fund-raise, valuing the company at $200 million, post the investment.
Gupta, co-founder and CEO, Craftsvilla told Times of India (TOI) that his company was aiming at going public in the next 12-18 months, despite the fact that most e-commerce majors have put their IPO plans on hold.
While Kribha Handicrafts, which runs Craftsvilla.com, is at present notching up $120 million in gross merchandise value (GMV annual run rate). GMV is sales made on an online retailer’s platform without factoring discounts and returns.
Gupta told TOI that Craftsvilla was aiming for valuation of at least a billion dollars in the next 12-18 months before going public. He hopes to get $500 million in GMV over the next one year. Independent directors would soon be appointed ahead of the company going public, he added.
Since beginning its operations, Craftsville had raised $20 million (excluding the latest infusion) with two rounds of financing. It plans to use a significant share of the fresh capital for marketing and international expansion having entered Malaysia and with an Indonesia launch on the cards.
“Craftsvilla has risen to category leadership in the ethnic space with a lean marketplace model that has scaled in an unusually capital-efficient manner. We are excited to continue to back them as they grow to the next level,” Shailendra Singh, MD, Sequoia Capital India, told TOI.
Founded in 2011 by Gupta and his wife Monica, Craftsvilla sells products across categories including clothing, handicrafts, jewellery and art, among others. It claims to have 25,000 sellers on its platform, selling close to 3.5 million products.
The online ethnic wear market is pegged at around $300-500 million in size with the bigger horizontal e-commerce players like Flipkart, Snapdeal and Amazon aggressively pushing their presence in the segment.
Margins in the ethnic category are higher compared to other segments, sometimes ranging as high as 60-80%. “We typically get a 20% commission on products sold,” Gupta said. Craftsvilla also proposes to launch private labels over the next few months, as these offer better margins in e-commerce.