Bengaluru-based CapriCoast.com, an online-to-offline (O2O) marketplace for modular furnishings, has raised $3.5 million in a Series A round led by existing investors Accel Partners India and RB Investments.
CapriCoast was founded by Jawad Ayaz and consists of a team of 55 members. Almost two-thirds of the workforce consists of design consultants and techies, with marketing and other roles accounting for the remaining one-third. In April 2015, the startup had raised $1.25 million in funding led by Accel India.
Along with Vinod Chandran, Jawad had also founded Zansaar.com, an e-commerce platform for home decor products. They had raised $6 million from Accel Partners and Tiger Global back in 2012. Talking to YourStory, Jidesh Haridas, Sales and Marketing Head of CapriCoast, added that Zansaar and CapriCoast sometimes engage in cross platform marketing for mutual benefit. “There is a certain degree of synergy, as Zaansar is about home products and CapriCoast is about home solutions. Zansaar has been around for longer and is hence a more well-known brand to the general public. So we do utilise their user base as a referral source. It sometimes works the other way too.”
RB Investments is a boutique VC firm from Singapore whose portfolio exists primarily across SE Asia and India. They have earlier invested in companies like Spuul and 5aSec among others. Rajesh Bothra, MD RB Investments, said,
CapriCoast is well aligned with our investment philosophy of investing in companies who are tackling a complex, multi-faceted problem that if addressed right provides a rapidly scalable business opportunity.
Earlier this year, CapriCoast launched an online-to-offline (O2O) modular furniture marketplace by partnering with Sleek International (an Asian paints subsidiary) and Spacewood – both leading manufacturers of modular furniture in India. The startup claims this model is an industry-first. The startup aims to provide customers with the widest design options and products at the best prices in the industry, with a hassle free, transaction and fulfillment process. Jawad, CEO of CapriCoast.com, said,
Our O2O marketplace model, addresses the problems that customers face today while buying modular furnishing – obfuscated pricing, delayed delivery, limited choice, and lack of transparency. We are working on a data science led, transformative technology that is rapidly changing the way customers experience the buying modular furnishing in India.
The startup is currently working with 50 showrooms across 15 cities in India. Jidesh added that currently the top six metro cities account for a large portion of their sales, but other cities such as Coimbatore, Madurai, Mangalore, Mysore, and Ahmedabad are also doing quite well. He adds, “Since most people furnish only one to two homes in their lifetimes, our repeat rate is low, but high referral rates from old customers make up for it.”
CapriCoast also has an ‘NRI Zone’ on their platform to cater to the specific needs of NRIs who are in different time zones but are comfortable making decisions online. Jidesh said, “Currently we are seeing traction for this, with the Middle East being our biggest market. Going forward we aim to target NRIs in countries such as USA and Singapore.”
CapriCoast works with brands on a pre-agreed structure and earns a percentage of the revenue on every transaction that they have helped initiate.
Prashanth Prakash, Partner at Accel Partners India Ventures, said, “CapriCoast has done an impressive job of building it's O2O model, and we are seeing great traction on both the consumer demand side and supply side.”
With purchasing power increasing and Indians investing in real estate, the home and furnishing segment is growing. This November, Rentomojo, furniture, household appliances, and bike rental platform, had raised $2 million in Pre-Series A from Accel Partners and IDG Ventures India.
In August, Livspace, an end-to-end home design and décor platform for homeowners, had raised $8 million in funding from existing investors Helion, Bessemer and Jungle Ventures. Some of the other big players in this space are HomeLane, UrbanLadder, Fabfurnish, Furlenco, Nestopia, and Pepperfry. Mumbai-based Stitchwood and Jaipur-based Wooden Street also focus on custom made furniture.
CapriCoast will use the funding round to broaden and accelerate product development and to expand its sales, marketing, and hiring efforts. It aims to be in over 200 showrooms across more than 50 cities by early 2016. They also plan to scale up their marketing efforts and focus on both online and offline (radio and hoarding) channels.
Going forward, CapriCoast aims to make their referral system more seamless through a mobile app, which is currently in beta phase. Jidesh confirmed that they will be officially launching a mobile app version of their product in the coming few months.
Global rating agency Fitch has estimated that the investment climate in India aided by reduction in interest rates will improve its property market by the end of March 2016. This will have a direct impact on the home and furnishing segment. Furniture alone is estimated to be a $20 billion industry. While there are a lot of players in this space, there seems to be room for multiple winners. With their focus on NRIs, an O2O model and an experienced team backed by well-known VCs, CapriCoast has a good opportunity to capture this segment.