 "Lenskart raises $200 million in secondary round at $5 billion valuation (1)")
Peyush Bansal, Co-founder and CEO, Lenskart
IPO-boundLenskart, the largest eyewear retailer in Asia, has raised $200 million in secondary investment from Singapore’s state-owned investment firm Temasek and US financial services major Fidelity, the company said in a statement.
As value in startup companies grows, secondary sales are a way to repay early investors.
The Peyush Bansal-led company is likely to be valued at $5 billion in this round. The firm was last valued at $4.5 billion during $100 million funding in June last year. Over the last 18 months, Lenskart has attracted close to $1 billion in capital, making it one of the largest growth-stage financings globally.
Avendus Capital was the exclusive financial advisor to Lenskart and its selling shareholders on this transaction.
This investment also marks Temasek doubling down on its existing investment in Lenskart, while Fidelity Management & Research Company (FMR) joins the cap table.
“This investment by renowned global investors underscores the uniqueness of Lenskart’s disruptive model and highlights the excitement surrounding one of the most anticipated IPOs in India in the coming years,” said Neeraj Shrimali, Managing Director and Co-Head, Digital and Technology Investment Banking, Avendus Capital.
“We are excited about what lies ahead for Lenskart and Peyush Bansal (co-founder). In our view, more late-stage tech companies will continue to garner strong investor interest demonstrating the robustness and excitement of the Indian consumer tech landscape,” he said.
Lenskart continues to deepen its penetration in India while rapidly scaling its international presence in Asia. With a unique click and mortar business, it is disrupting the eyewear industry by offering an omni-channel customer experience spanning across online, mobile applications and stores. The company now has over 2,500 stores of which 2,000 are in India. Lenskart continues to deliver strong growth and consistent profitability.
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Acquisitions
Globally and in India, Delhi-based Lenskart competes with players such as Titan Eyeplus, Specsmakers, Vision Express, Warby Parker, and Italian eyewear conglomerate Luxottica Group.
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The company has also been making a few acquisitions to scale up its operations and get access to new technologies. Last year it announced its acquisition of Tango Eye, an artificial intelligence-based computer vision startup, for an undisclosed sum.
With this acquisition, Lenskart aims to utilise visual AI technology to enhance both the store and product experiences.
In stores, Tango Eye’s technology analyses CCTV footage to provide analytics, optimise customer flow and ensure proper adherence to all procedures.
Similarly, in its manufacturing plant, the technology is helping Lenskart automate quality tests for its lenses and eyeglasses.
Last year in September, Neso Brands, a subsidiary of Lenskart, acquired a stake in the Paris-based eyewear brand Le Petit Lunetier for $4 million. The investment is funding Le Petit Lunetier’s retail expansion, solidifying its brand presence in Europe and introducing the brand to Lenskart’s primary markets in Asia and the Middle East.
In 2022, Japanese brand Owndays became a part of the Lenskart group in a deal estimated at $400 million. The Tokyo-based direct-to-consumer eyewear retailer operated its own network of stores across 13 markets, ranging from Sydney to Dubai.
Earlier this year, it opened its 500th store.
Owndays had already received support from Neso Brands and Lenskart in several areas, including supply chain and manufacturing, analytics, and omnichannel technology, following the investment to boost both revenue and profitability.
Lenskart’s revenue from operations soared to Rs 3,788 crore in FY23 from Rs 1,502 crore in FY22, according to Entrackr. The decent scale and controlled expenditure helped the company reduce its losses by 37.3 per cent to Rs 64 crore in FY23 from Rs 102 crore in FY22.
The company has its biggest manufacturing plant in Bhiwadi, Rajasthan. The eyewear brand also has a facility in Gurugram. The company is looking to acquire land near Bengaluru airport to set up a mega factory.
In India, 90 per cent of the specs market is unorganised.
According to Lenskart, there is one optometrist for every 50,000 people (this figure for the United Kingdom is one per 7,000 people). As many as 153 million people in the country need reading glasses but do not have access to them.
This was the problem that Bansal, an alumnus of IIM-Bangalore and Canada-based McGill University, wanted to address when he founded Valyoo Technologies (Lenskart) in 2010, along with his two co-founders Amit Chaudhary and Sumeet Kapahi.
