Eyewear unicorn secures fresh funding from its leadership, following a $200 million investment last month, signaling strong growth trajectory
Introduction:
In a significant move that underscores confidence in its business model and growth prospects, Lenskart, the omnichannel eyewear retailer, has secured nearly $20 million in funding from its co-founders. This latest investment comes on the heels of a substantial $200 million secondary round last month, highlighting the company’s robust position in the Indian startup ecosystem.
The funding round, led by CEO Peyush Bansal, saw participation from fellow co-founders Neha Bansal, Amit Choudhary, and Sumeet Kapahi. According to regulatory filings accessed from the Registrar of Companies (ROC), Lenskart’s board passed a special resolution to issue 695,875 compulsorily convertible cumulative preference shares (CCPS) at an issue price of Rs 2,300 each, raising a total of Rs 160 crore (approximately $19.12 million).
Breaking down the investments, Peyush Bansal led the round with a contribution of Rs 70.70 crore, closely followed by Neha Bansal at Rs 70.39 crore. Amit Choudhary and Sumeet Kapahi participated with Rs 9.60 crore and Rs 9.35 crore, respectively. This move marks the second instance in less than a year where the co-founders have invested in the company, demonstrating their continued faith in Lenskart’s potential.
The fresh capital injection comes at a time when Lenskart is experiencing significant growth and expansion. The company, founded in 2010, has rapidly evolved to become one of the leading omnichannel eyewear retailers globally. With a presence in India, Singapore, Dubai, the United States, and Southeast Asia, Lenskart boasts an impressive network of over 2,500 stores, with approximately 2,000 located in India alone.
Lenskart’s financial performance has been equally noteworthy. For the fiscal year ending March 2023, the company reported a substantial surge in revenue from operations, reaching Rs 3,788 crore, up from Rs 1,502 crore in the previous fiscal year. This remarkable 152% year-on-year growth underscores the company’s strong market position and effective business strategies. Moreover, Lenskart managed to narrow its losses by 37.3% to Rs 64 crore in FY23 from Rs 102 crore in FY22, indicating improved operational efficiency.
The company’s growth story has attracted significant investor interest. Over the past 18 months, Lenskart has raised an impressive $1 billion in funding. The recent $200 million secondary investment from Singapore’s Temasek and US-based Fidelity Management & Research Company (FMR) valued the company at over $5 billion, cementing its unicorn status and positioning it as a key player in the Indian startup landscape.
Lenskart’s success can be attributed to its innovative approach to the eyewear market. The company has effectively leveraged technology to create a seamless omnichannel experience for customers, combining the convenience of online shopping with the personalized service of physical stores. This strategy has allowed Lenskart to capture a significant market share in India, where it claims to have a customer base of 20 million.
The company’s international expansion has also contributed to its growth, with operations outside India now accounting for approximately 40% of its revenue. This diversification not only reduces dependency on a single market but also opens up new growth avenues for the company.
The recent investment by the co-founders is particularly significant in the context of the current funding environment. Despite the ongoing funding winter in the startup ecosystem, Lenskart continues to attract capital, reflecting investor confidence in its business model and growth potential. This internal funding round also sends a strong signal to the market about the management’s belief in the company’s future prospects.
For the Indian startup ecosystem, Lenskart’s continued success and ability to raise funds serve as a beacon of hope. It demonstrates that companies with strong unit economics, clear growth strategies, and effective execution can still attract investment, even in challenging market conditions. Lenskart’s journey from a startup to a unicorn with global ambitions also provides a roadmap for other Indian startups aspiring to scale beyond national borders.
Looking ahead, Lenskart is well-positioned to capitalize on the growing eyewear market in India and abroad. With its strong financial backing, expanding store network, and focus on technology-driven solutions, the company is poised for further growth. The recent funding from its co-founders is likely to be deployed towards enhancing its technological capabilities, expanding its product range, and further strengthening its market position.
Conclusion:
In conclusion, Lenskart’s latest funding round, led by its co-founders, reaffirms the company’s strong position in the eyewear market and its potential for continued growth. As the company moves forward with its expansion plans and innovative strategies, it not only cements its place as a leader in the eyewear industry but also serves as an inspiration for the broader Indian startup ecosystem. Lenskart’s journey exemplifies how a clear vision, coupled with effective execution and strategic funding, can lead to sustained success in the competitive world of startups.
