FirstCry to launch $75M Thrasio-style investment venture
Firstcry will launch the country’s largest Thrasio-style investment venture with $75 million in capital commitment from investors such as SoftBank, TPG, ChrysCapital, and Premji Invest, sources revealed.
Global Bees will buy, strengthen and fast-track the growth of brands that sell products on e-commerce marketplaces in the country.
The model popularised by US-based Thrasio, the world’s largest acquirer of third-party private label businesses on Amazon, is pacing up in India. Around half a dozen investors have already started their own ventures to take over and grow companies this way.
Within three years of launch, Thrasio has acquired, consolidated, and expanded about 100 brands on Amazon. The profitable company has secured $1.7 billion across debt and equity and is worth $3-$4 billion, as per news reports.
Global Bees is looking to take over 30-40 D2C firms over the next three to four years, investing about $2-$6 million in each. It will utilize the extensive consumer insights that founders and investors have gained over the years to help them grow, one person said.
“Small brands do not have the marketing and digital branding bandwidth, the warehousing and logistical support, and the new product development know-how that such ventures can provide,” stated another person. “The company will either buy out these smaller brands or will pick up a controlling stake in these companies to work alongside the founders.”
Global Bees will be headed by Nitin Agarwal, the former president and Group CIO, CTO, and Chief Digital Officer at Edelweiss Financial Services, the sources said.
“The venture is already in talks to acquire three to four small brands and an announcement is likely within a month,” a third person familiar with the development said.
Last month, a clutch of private equity investors – TPG, ChrysCapital, and Premji Invest invested about $315 million in Firstcry, valuing the Pune-based company at around $1.9-$2.1 billion.
Ananth Narayanan, the former chief executive of Medlife and Myntra, is also starting his own Thrasio-like platform.
Accel, Falcon Edge, and Norwest Venture Partners have committed $25 million to the venture, according to multiple people aware of the development.
India is witnessing an uptick of smaller brands, with around 8,50,000 vendors selling on Amazon India, of which around 4,152 have crossed Rs 1 crore in sales in 2020.
Similarly, there are around 350,000 such sellers on Flipkart, of which 70 have crossed the Rs 1 crore sales mark.
FirstCry is a leader in the children’s retail segment. The expected investment could help the company to further scale its operations and increase revenue.Shishir Gupta, Founder and CEO, StartupLanes
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