Here’s how this startup is chasing its dream of creating two unicorns with its tech stack
What is better for a startup than becoming a unicorn? Becoming two unicorns! And that’s exactly what Mumbai based design-tech startupenvisions to become. Based out of Mumbai, Bangalore and Boston (USA), Flipspaces is using its multi-module technology stack to enable two multi-billion dollar global opportunities.
Founded by Kunal Sharma and Ankur Muchhal in 2015, Flipspaces is a design-tech venture which is focused on technology solving multiple stakeholder challenges within the space of Interior Designing and Furniture and Furnishing buying globally. Powered by a multi-module tech stack, the technology-enabled platform envisions building a global platform to design and deliver commercial spaces and is currently backed by CarpeDiem Capital along with a consortium of investors headed by Prashasta Seth, EX-CEO, IIFL AMC and Founder of Prudent Investment Managers.
Using technology to design and build commercial spaces
“The interior design and associated supply chains for products and services are broken globally in the Small and Medium Business category. There is no de facto brand to design and execute such mandates at a scale where business owners have to deal separately with designers, suppliers and contractors. Leveraged by its proprietary technology suite, Flipspaces looks to create a global platform where interior designers, product and service suppliers can come together to deliver a seamless and differentiated experience to the customer looking to furnish their commercial space”, says Kunal Sharma, Founder and CEO.
The tech-suite called Vizworld allows for significantly better control over cost, quality and timelines by integrating the entire supply chain onto one platform while creating seamless scale. The suite comprises a product discovery platform, VR and gamification enabled design visualiser and an integrated design and project management system.
According to Ankur Muchhal, the co-founder and COO of Flipspaces, “The $240 billion global market is of essence while talking about our playing field because we now have a fully operational presence in the US where we have grown 35X in the last 6 quarters and have now become profitable. In that sense, we have validated the same business thesis of organising the design and build of the small and medium-sized commercial floor plate globally. We have seen that the challenges faced by the small business owner are the same across the globe which is where over 85% of our traction comes from.” The venture has designed and delivered over 5 Million Sq. Ft. of space across India and the US through its platform combined with the supply chain ecosystem built around it.
“The key to our scale while maintaining industry-defining capital efficiency is the unit metrics of commercial mandates executed through the platform. Our ticket size is broadly 15 times that of tech-enabled residential focussed interior design startups with the same gross margin profile. Further, 60%+ of our business comes from repeat and referral clients thus having a significant southward impact on the cost of Customer Acquisition. Because of that reason, today we have industry-best operating metrics amongst funded interior design-tech startups,” Kunal observes.
Jerk Shack, Texas
Virtualizing furniture and furnishing retail experience
The second business vertical in Flipspaces originated at the time of the pandemic and is a fairly recent one - a virtual store SAAS for furniture and furnishing retailers. “The first wave had brought the entire business world to a screeching halt. Shut-downs had impacted small businesses severely. One of the worst-hit segments was furniture and furnishing retail where retailers were dabbling with depleted walk-in volumes of retail buyers. Solving this challenge is what led to the germ of the idea of Vizstore, the Virtual store SAAS for furniture and furnishing retail”, observes Ritesh Ranjan, partner and CTO.
One of the biggest problems that retailers and manufacturers face in the Furniture and Furnishing Category is the limitation of real estate to effectively showcase their products. At the same time, a standard e-commerce presence is not enough to create an experiential buying intent because it can only merchandise static photos of the products. This is where VizStore steps in, the virtual reality-enabled digital twin of the physical Store.
With the help of VizStore, retailers and manufacturers can upload their single or multi-brand catalogues in the backend. The web-based frontend powered by gamification and VR enables customers (end buyers, architects and interior designers) to walk through the retailers’ showroom virtually through their laptops, tabs on mobiles.
Marcy Labs, NewYork
These virtual showrooms, as Flipspaces calls them, enable retailers to showcase their products in a host of environments like living rooms, bedrooms, bathrooms etc thereby exploding the possibility of visual merchandising of products in environments that are relevant to an end customer. Further, products integrated from the retailers’ bespoke catalogues can now be changed in these virtual environments with the click of a button.
The software is further loaded with other commerce-enabling features like adding products to the cart, generating quotations and invoices and distributing specific products and environments to relevant customers virtually.
“We want Vizstore to become the Experiential Shopify of the Furniture and Furnishing segment. We are further developing more business tool kit features like inventory management, POS and CRM to make Vizstore the De Facto retailing software for this industry”, remarks Ritesh Ranjan.
As against the free go-to-market approach for several SAAS operators, Flipspaces took a paid first strategy because of the unprecedented nature of the product. In a few months, in a small micro-market and a single category, the SAAS product has 300+ paying retailers. They have started sales in the USA for Vizstore and the team seems extremely confident of the global potential of the SAAS product.
“While we have an industry-defining price architecture in the SAAS product, what excited us further is the potential of building several more monetisation layers with a larger paid customer base. We already have interests from NBFCs and financial companies who are willing to power a fin-tech layer enabling several financial products in the furniture and furnishing retail segment. This segment is ripe for disruption with retailer financing and BNPL constructs still at a nascent stage,” Kunal says with visible excitement.
Open Money, Bangalore
Focus on international expansion
At about $100 Billion, the US is one of the largest markets in the world for commercial design and build. The US market also has a greater ability to understand the technology and pay for it. Our advent in the US has resulted in a substantial improvement in the margin profile of the overall business. We are using technology to service design only projects from a team in India. This stack of revenue has very high gross margins because of the Design Process Outsourcing play which is differentiated by technology. Additionally, a large percentage of these SME mandates then convert to build and product supply. There are further significant margins of product supply because products are typically manufactured and exported through OEMs from India.
“We are buoyed by the response the US has given in the last six quarters. Despite the impediments posed by the pandemic, we have grown 35X in revenue in the US and are profitable with even better margins than India. Most importantly, the US expansion validates our thesis of addressing the broken ecosystem of commercial design and build for small floor plates globally, thus substantially increasing our playing field”, says Kunal.
Open Money, Bangalore
On the SAAS side, while Flipspaces has just started its sales engine in the US, the team is confident that the SAAS uptake will be even higher in the US than in India.
“The problem of experiential product showcasing is a global problem. We have an unprecedented product that uses VR, gamification and multiple other technology stacks that enables the furniture and furnishing retailer to drive omnichannel commerce more efficiently and at a lesser cost. Empirically, almost all of the SAAS unicorns from India have a lion’s share of their revenue coming from the US and Europe. We expect the same trend to play out with VizStore, our SAAS vertical,” observes Ritesh.
“We truly believe Flipspaces is an extremely unique venture which is attacking two global problems with a common technology stack. We are six Founders and have a pedigreed second level of leadership to drive growth in both verticals. For an entrepreneur, the vision is always to maximise the value of their dream. We believe we’re on the right path towards realising that vision. We continue to engage with like-minded investors who can come in as partners to drive this vision and back us in this unique journey we’ve undertaken”, concludes Kunal.