Livspace marks $100 million for strategic acquisitions

Livspace marks $100 million for strategic acquisitions
Omnichannel home interiors and renovation platform Livspace—which recently entered into India’s unicorn league of startups or privately-held businesses valued at over $1 billion—has earmarked a corpus of $100 million for largely acquisitions as it looks to go deeper in existing geographies, add new categories to its core offerings as well as introduce more margins to its overall business.
The company is fuelling a significant part of this corpus through its recent $180 million fundraise led by private equity major KKR, announced in February this year. The funding valued the company at $1.2 billion.
According to company co-founder and chief executive officer (CEO) Anuj Srivatsava, the company will be looking to invest in businesses working across home improvement segments such as partial renovation and supply of business-to-business (B2B) modular materials, to boost the company’s topline. It will also look to invest in direct-to-consumer brands across furniture, and other home improvement categories.
“Today a homeowner has a variety of problems and home interiors is just one manifestation,” Srivastava said. “There is an entire lifecycle that a homeowner goes through. So, we will be looking at complimentary categories to our core business including premium interiors and modular fitouts to name a few. We are also in an assortment of geographies such as Southeast Asia and are having early discussions in the Middle East. These acquisitions may give us market access, deepen our presence (in existing geographies) and save time towards building mindshare.”
Livspace’s acquisition strategy is focused on scouting profitable companies in the home improvement space with annual revenues between $15 million and $45 million, Srivastava added. The company is expected to potentially make up to five acquisitions with this corpus over the course of FY24, with a bulk of them to bolster its presence in India, and the rest focused on expansion in Southeast Asia and Middle Eastern markets.
“The build-and-buy strategy is an extension and we will look to grow both organically and through inorganic efforts,” added Srivastava.
Currently, Livspace is present in 40 cities across India including global markets and looks to scale this to 50 cities by the end of the year. It is looking to build an order book of $500 million by the end of FY23 and clock a revenue run rate of $300 million by the end of the ongoing fiscal year.
The company also recently acquired a majority stake in Singapore-based Qanvast, a platform that connects designers with homeowners. It financed the transaction partly through its balance sheet and the newly-formed corpus for acquisitions.
“We want to be methodical in acquiring and investing in these companies. We will be making the investments over the course of the next 12 months and look at businesses which can add value,” Ankit Shah, chief strategy officer, Livspace, said.
Founded in 2014, Livspace is a home improvement platform which provides renovation solutions for homeowners right from designing to last mile fulfilment. The platform brings together designers, brands, manufacturers and contractors to enable an ecommerce-like experience to home renovations.
The company has raised $450 million in equity capital till date from investors including KKR, Ingka Group Investments, the investment arm of IKEA parent, TPG Growth, Goldman Sachs, Venturi Partners and Bessemer Venture Partners, among others.
Livspace also recently launched operations in Malaysia and Riyadh in partnership with Ikea and plans to continue expanding these regions.