Furniture rental startup Furlenco raises a $6 million series A round from Lightbox Ventures
Furlenco is a Bangalore based startup which rents out furniture on a monthly subscription model. The company has just announced a fund raise of $6 million from Lightbox Ventures. Founded by ex-Goldman Sachs senior professional Ajith Karimpana, Furlenco had previously raised a small angel round of $100k. Spending close to two years in the Bangalore market, the startup has been able to gain investor confidence and this infusion of funds will help them scale up operations.
There are some interesting points about this furniture rental company-
1) Furlenco designs, owns and holds all the inventory. Yes, the company has an inhouse team that designs all the furniture and this allows them to ensure quality end to end.
2) The startup work on a monthly subscription model wherein a customer can get solutions for living rooms, kitchen or bed rooms. The subscriptions start at INR 1500 per month (this particular plan includes a queen size bed and table, single bedside table, lamp & photo frame and some soft furnishings). These subscriptions can go to about INR 7500 per month and one can also customize.
3) The customer experience is completely managed since Furlenco takes responsibility for everything- from the time a user lands on the website to select the furniture to renting to sending over a team to set it up to taking it back or putting the subscription on pause.
Ajith started the venture due to the problems he faced with relocation when he was moving from the US to India. He had almost $5000 worth of furniture which he had to sell since shipping it was very costly and on coming to Bangalore, he could never find the stuff that he wanted for his house. "The experience was tiresome and I was disappointed at the end of the experience. Something had to be done," recollects Ajith about how he started the venture. Starting as RentUrDuniya, the company has slowly found its way to a model where it feels scale can be achieved.
The team strength currently stands at close to 40 and with Lightbox coming in as an investor, the plans are to rapidly expand and set the processes for Bangalore in the next few months before going to other metros. Sid Talwar, partner at Lightbox will be joining the board and he shares their thesis behind the investment-
1) The market. After a home and a car, furniture is probably the third highest investment an average individual makes in his lifetime. For the first two, there are long term loans and for everything under these top three, the price of the product has fallen over time so that access increases. Furniture has been hanging in the middle.
2) There are massive companies in the west renting out furniture and India is now at a point where renting furniture will shoot up. The reasons are different for both the geographies though. In developing countries, the question is of access. There is a huge segment for whom a certain kind of furniture is always out of reach. Furlenco changes this.
3) The team that Furlenco has and the customer experience it can provide.
In terms of the competition landscape, Furlenco doesn't eat into the pie of an UrbanLadder or FabFurnish, nor the likes of FabIndia. Owning all the inventory, the market for Furlenco is the growing 25-34 age bracket people in urban India who change a house every three years on average. Mumbai-based Rentomojo is another startup in this domain. Furlenco is currently active in 200 homes which are on a monthly subscription and going forward, the main focus will be on increasing this number.