Tuesday 18 August 2015

Askme to invest $20 million in furniture etailer MebelKart

Local search platform Askme.com is going to invest $20 million in online furniture marketplace MebelKart.com over the next three quarters in return for a majority stake in the company, said a top executive of the company.

"We are going to invest $20 million in MebelKart overtime in return for a majority stake in the company which would be in excess of about 75%," said Manav Sethi, Group CMO Askme & head of digital strategy. The rest of the stakes would be held by the promoters, he said.

Sethi believes this strategic investment will help both Askme and MebelKart to acquire a significant share in this profitable and rapidly growing category which is yet very fragmented and unorganised.

MebelKart, which was founded by three young IITDelhi graduates and entrepreneurs Rahul Agarwal, Nikhil Saraf and Ranjeet Vimal in 2012, currently sells more than 100,000 furniture products across India from more than 1,000 sellers across the country.

Based out of Bengaluru, it currently has a team of 30 people comprising technology, business development, catalogue, marketing and design teams and had earlier raised angel capital from some of their peers.

Right now MebelKart will operate as a separate legal entity but maybe in some time we will merge it into our transaction platform, said Sethi.

"There are no major brands in this space beyond brands which are on the upper end of the spectrum. So, while we were looking at the furniture space very closely we stumbled upon this young team. They have not only built a good relationship with the merchants but they have also created an awesome online product," said Sethi, on the company's acquisition of the online furniture marketplace.

According to Sethi, Mebelkart has been struggling to fulfill certain order size and, hence, Askme's intention is to scale their operations pan-India and bring it to a position where it becomes a name to reckon with.

"In two months of acquiring the online grocery player Bestatlowest.com, we scaled them to become a Delhi/NCR player. And within the next four quarters we intend to scale them up to pan-India operations.This is how we plan to scale up MebelKart as well," said Sethi.

Askme is majorly owned by Malaysia's Astro Holdings which has invested $100 million in the company till date.

In May this year Askme has acquired grocery marketplace 'BestAtLowest.com' for about $10 million.

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