Pune-based baby care company, FirstCry recently raised $150 million from Softbank as a part of a larger funding round.
According to regulatory filings, around $150 million has already been infused into the company and is expected to be utilized to expand FirstCry’s offline and online presence, and also to strengthen their technology platform. FirstCry will be raising an approximate amount of $400 million (Rs. 2,825 Crore) from SoftBank’s $93 billion Vision Fund in multiple installments.
While most companies have struggled to expand in the baby care business that is still largely dominated by offline stores, high real estate and customer acquisition costs have crippled the efforts of baby care retailers to build large businesses. On the other hand, FirstCry has gone further by creating an opportunity and grabbing onto it by using its online and offline channels’ full potential to offer a wide assortment of low-priced products to customers.
Started by Supam Maheshwari & Amitava Saha in 2010, the BrainBees Solution-owned baby and mother care product company had raised an approximate amount of $125 million from multiple investors, such as Chiratae Ventures, SAIF Partners, Valiant Capital Partners & Vertex Ventures, prior to this funding round. Even Ratan Tata has picked up some stakes in the company.
In 2016, FirstCry also acquired BabyOye, a Mumbai-based e-commerce store providing pregnancy, infant-care, and mother care products in India for $54 million. By the end of 2018, FirstCry had an offline presence across the country with about 350 offline stores.
Ranging from products in different categories like diapering, feeding, nursing, skin and healthcare, toys, clothes, footwear & much more, FirstCry claims to offer more than 2 lakh baby and kid products.
According to the reports, with SoftBank’s investment of $400 million, FirstCry’s evaluation has shot up to $800 million from what was less than half before at $350 million and has taken it very close to the unicorn tag.
Initially, it was also rumored that FirstCry was in talks with Temasek Holdings, Chinese Internet giant Tencent and another Chinese investment firm for the next round of fundraising. Morgan Stanley was appointed as the investment banker for the said deal. However, FirstCry and Temasek talks didn’t reach any consensus over the valuation issues.
With SoftBank bagging big returns from its investment in e-commerce giant, Flipkart, after acquisition by global retailer Walmart, and from multiple other companies it has recently invested in, the company’s increasing trust on Indian startups looks a promising idea for the Indian startup ecosystem. SoftBank Investment Advisors, through SoftBank Vision Fund also very recently led the investment round for Ola, a cab-service providing platform, along with the participation of their pre-existing investors, namely, Lightspeed Venture Partners, Sequoia and Green Oaks Capital.