Thrasio-like startup Evenflow acquires Chennai-based online sports brand Xtrim

Ecommerce roll-up company Evenflow on Thursday said it has acquired Chennai-headquartered sports and fitness accessories brand Xtrim. 

This marks Evenflow’s third online brand acquisition in a month — including babycare brand BabyPro and sustainable lifestyle and hygiene products brand Rusabl.

Xtrim — a digital-first brand by Asghar Ali and Sathish Kumar — was founded in 2016, which manufactures and sells sports and fitness accessories, such as gym globes, joint wraps, etc. 

Evenflow expects Xtrim to grow by 5X by 2022, given the under-penetrated and largely unorganised sports and fitness market in India.

“The sports and fitness category has witnessed massive growth as people become more health-conscious and working-out-from home becomes the new normal. Xtrim being our first acquisition in the category, we are excited about providing customers with premium quality fitness products at competitive prices,” said Pulkit Chhabra, Co-founder and Vice President - Acquisitions, Evenflow, in a statement.

Xtrim founders, Ashgar and Sathish, said, "The idea behind the brand Xtrim is to offer world-class fitness products that are essentially 'Made in India' and compete with the best in the world. During our discussions with Evenflow, we found a lot of synergies like our strengths in manufacturing coupled with Evenflow's expertise in the ecommerce space, and expect to leverage those to realise the full potential of Xtrim."

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What gives

Several Indian startups have started following the ecommerce roll-up model — pioneered by US-based Thrasio — which acquires brands selling on Amazon. According to reports, Thrasio has a buy rate of 1.5 businesses a week and manages over 200 brands.

Valued at over $5 billion, Thrasio, founded in 2018, is also said to be looking at entering the Indian market.

However, homegrown competitors are looking to cash in on the first-mover advantage, with the sector seeing large bets from institutional investors.

GlobalBees — founded by FirstCry Founder Supam Maheshwari and former Edelweiss executive Nitin Agarwal — raised $150 million in the country’s largest Series A round earlier this year.

Similarly, Mensa Brands — helmed by former Medlife and Myntra CEO Ananth Narayan — has raised over $80 million in two rounds to grow its brand umbrella.

Founded in 2021, Evenflow has raised $869,000 in a seed round from Equanimity Investments, 9Unicorns, and others. It stands out among its competitors in acquiring third-party sellers on marketplaces at EBITDA multiples rather than revenue multiples. Typically, the startup invests between $200,000 and $1.5 million per brand.

The ecommerce roll-up model has gained momentum, especially after the draft ecommerce policy promises to scrutinise unfair advantages given to sellers and private labels of a marketplace. Strong online brands and sellers can do better in logistics, marketing and inventory management which the ecommerce roll-up models bring to the table.

According to Redseer, the ecommerce roll-up model also helps brands optimise on reducing overhead costs and operating costs without cutting down on volume or prices.