RentoMojo raises $5M funding from IDG Ventures and Accel Partners
Bengaluru-based RentoMojo has raised $5 million in Series A funding from IDG Ventures and Accel Partners, India.
The funds raised will be used to further strengthen their product and the data driven structure within the company.
Founded by IIT Alumnus Geetansh Bamania in November 2014, RentoMojo has expanded to four cities including Delhi, Mumbai, Pune and Bengaluru.
RentoMojo aims to create awareness about ‘renting’ and the ‘access lifestyle’ as a concept in the consumer consideration set. The company is anchored on an asset-light, fintech model that makes it a scalable business venture in the startup ecosystem.
A consumer on average pays $30 per month for their items and the average span of a contract for payments is eight months in duration. The startup currently claims to have 10,000 active customers, including all the six cities that it is operational in. It is planning to target 1-1.5 lakh subscribers in the next 18 months.
How does its business model work?
Rentomojo is a marketplace offering furniture, furnishings, appliances, trekking equipment and bikes, that young professionals can book at affordable rentals. With frequent city immigrations, it becomes expensive for 25-30-year-old professionals to buy high-cost furniture and sell them later. This rental pattern conveniently solves the problem.
The company, which aims to change the ownership pattern and lighten the asset burden with affordable rental costs, works on a slightly different business model from the one it followed before. Changing from capex to opex, the startup now works with financiers who pay for the assets and willingly rent them out. From the rental charges received, the financers get a cut. So, by the end, the consumers as well as the owners monetarily gain. Geetansh Bamania, founder of RentoMojo, said,
Apart from the cities we are operating in currently, we plan to expand to two more cities in the coming quarter. We are growing at a breakneck pace of 30 percent MoM growth and we hope to continue on this growth trajectory.
RentoMojo in 2015 had raised $2 million in Pre-Series A funding from Accel Partners and IDG Ventures, India. Before that, the startup raised angel funding from Snapdeal’s former Chief Product Officer Anand Chandrasekaran, GSF India founder Rajesh Sawhney and other angel investors.
In the Indian market, where the rental space is estimated to be $335 billion, the startup is currently competing with WhatsOnRent, which raised an undisclosed amount of angel funding from Commonfloor’s Co-founder Lalit Mangal, Excubator Co-founder Neeraj Gupta, angel investor Sanjay Gupta and Nixel Technology.
During the same time, FlatFurnish also raised an undisclosed amount of funding from Jabong Founder Arun Chandra Mohan, which was supposed to be used for the company’s expansion.
Bengaluru-based Furlenco had raised $6 million in funding from Lightbox Ventures in 2015.