India’s billion-dollar Mensa Brands is already profitable, says the founder

The Indian start-up company Mensa Brands has thrown itself into the billion-dollar unicorn status in just six months, and in a more refined feat, it is already profitable, the founder told CNBC.

This week, the consumer-direct brand aggregator became the fastest company in India’s history to reach the coveted threshold after completing its $ 135 million Series B financing round at a valuation of $ 1 billion.

The financing, which was led by Falcon Edge Capital, brings total money collected into debt and equity to $ 300 million.

“During the first six months of operation, we̵[ads1]7;re actually profitable, and we continue to aim to run this business profitably,” founder Ananth Narayanan told CNBC’s Street Signs Asia on Thursday.

Growing brands that are first in the digital market

Mensa Brands operates by acquiring brands that are primarily digital and scaling them domestically and abroad. It currently houses 12 brands divided into three key categories: fashion, home and beauty and personal care.

“We’ve actually had a lot of success accelerating the brands, and that’s really why I think the business is valued at what it’s valued at,” Narayanan said.

The key, said Narayanan, who previously served as CEO of Indian fashion e-commerce company Myntra, has been to identify profitable brands with quality entrepreneurs, loyal customers and between $ 1 million and $ 10 million in annual sales.

Ananth Narayanan, founder of the Indian brand aggregator Mensa Brands.

Mint | Hindustan Times | Getty pictures

“Over the last six months, through technology, through product, through digital marketing, we have been able to make our brands grow 100% north from year to year, and I think that has been the key,” he added. .

Over the next 12 months, Narayanan said the company plans to double its existing verticals, and partner with 30 more brands.

“These markets are very deep … [they’re] north of $ 120 billion in both offline and online revenue, “Narayanan said.” That focus helps us build brands very differently, because we understand space well, we understand niches well. “

IPO plans “down the road”

Mensha Brand’s rapid rise comes as India’s start-up ecosystem flourishes with an increase in digital adoption and better access to private capital.

There are currently around 70 start-ups in India that fit the definition of a unicorn, according to Goldman Sachs estimates. More than a third of them said they reached the $ 1 billion valuation mark in 2021.

Digital payment platform Paytm, one of India’s original technology start-ups, was listed on Thursday in a $ 2.5 billion IPO – the country’s largest ever. The shares fell 24% on the first trading day.

Mensa Brands’ Narayanan said his company does not plan to use public markets at this early stage. However, he said that a public listing would probably be “down the road”, noting that the company has big growth ambitions.

“Absolutely, down the road, the answer is that we would go public,” Narayanan said. “We are a house of brands. We want to create what I want to say is a modern version of a Unilever or an Inditex of digital first brands.”

– CNBC’s Saheli Roy Choudhury contributed to this report.

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