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Lenskart : Emerging Unicorn

Lenskart is an Indian eyewear online portal often called as the ‘Amazon’ of eye wear. The company has successfully led a breakthrough by penetrating into eyewear industry that is dominated by unorganized players.

About the Founders

Peyush Bansal 

Peyush Bansal, the founder & CEO of Lenskart did his Electrical Engineering from McGill University, Canada in 2006. He worked as a Program Manager with Microsoft. He returned to India to pursue Management course from IIM-Bangalore, where he launched his portal ‘SearchMyCampus’ under his company “Valyoo Technologies” in 2007. Following the success from SearchMyCampus, Peyush went forward towards selling Jewellery, Cosmetics, Eyewear in the US. Peyush launched ‘Flyrr.com’ in the US which gained good traction and prompted Peyush to launch a similar business in India. This led to the birth of Lenskart in November 2010 under its parent company – Valyoo Technologies. Peyush met the other co-founders over Linkedin.

Amit Chaudhary 

The co-founder of Lenskart did his Engineering in Computer Science from Birla Institute of Technology, Ranchi. He is responsible for aggressive offline expansion of Lenskart.com.

Sumeet Kapahi

Just before the company raised $4 million from Venture capital firm IDG Ventures in November 2011, Mr. Sumeet Kapahi joined as the third co-founder. Sumeet Kapahi was a business development manager of Luxotica India Eyewear (Rayban) and now is VP-Supply at Valyoo Technologies.

Historic Milestones of the company

2010- Lenskart.com was founded in November 2010 – promoted by Peyush Bansal, Amit Chaudhary, Neha Bansal & Sumeet Kapahi.

2011- Initially, the business dealt only in Contact lenses. Within 3 months the business included Eye-glasses followed by Sunglasses.

2015- Lenskart increased its spectacles manufacturing capacity from 5,000 spectacles a day to 40,000 pieces a day (part of larger plan to increase its capacity to 200,000 pieces a day) at its Okhla plant in Delhi.

2016- In order to expand further, Lenskart appointed 5 top level managers. This includes the appointment of Mr Sambuddha Bhattacharya (former Rocket Internet employee) as the Vice- President; Mr Calvin Lyngdoh (Ex-director HR at Kimberly Clark Lever) as Chief Human Resources officer; Mr Sunil Menon (formerly with Bharti Retail & Future Retail) as Vice President-Retail.

2016- Lenskart tied up with Delhi-based call management system startup ‘MyOperator’ for accelerating the backend operations of the company.

2016- Set up manufacturing facility in Prithla, Haryana; this facility is apart from 3 facilities in New Delhi’s Okhla area. 

2017- Lenskart tied up with ‘Truecaller’, enabling them to identify the order related calls from the company as priority.

2017- In September, Lenskart invested $1 million in California-based 3-D graphical modelling venture ‘Ditto’, for developing 3D face models for Lenskart’s virtual trial service.

2017- December, Lenskart bought a minority stake in an Israeli startup ‘6over6’, to help consumers check the power of their eyes and lenses in their eyeglasses through a smartphone application.

2018- The company in February 2018 invested $4 million into affordable-premium eyewear brand ‘John Jacobs’ to setup more stores across cities of Delhi-NCR, Bengaluru & Mumbai.

2018- Lenskart started its facility near Gurugram, Haryana with a manufacturing capacity of 1 lakh frames a month, with an investment of $1 million. The company expects to ramp up its capacity to 3 lakh frames a month in 3 years. The facility is involved in lens cutting, manufacturing of frames & lenses.

2018- In May, the company invested Rs 3.37 Crore in California-based startup ‘ThinOptics Inc.’, which makes innovative reading glasses that can be placed on user’s nose and even attached to the user’s phone, keychain or laptop.

2018- In October, Lenskart acquired a manufacturing facility in China. Owing to the large number of spectacles being sold, the company planned to indulge in the activities of frame designing and moulds designing at this facility.

2018-19- Lenskart entered in Singapore and has plan to expand to 50-60 stores in next 3 years before expanding to amrkets such as Philippines, Taiwan and the Middle East.

2019- In order to increase the sales volume Lenskart in March 2019 allocated $10 million for its contact lens business.

2019- The company welcomed Indranil Chakravaty (former Bausch & Lomb business unit head) to lead the contact lens business of the company.

2019- In April, Lenskart launched a new Android based app called ‘Lookr’ to double down on technologies related to face mapping, face analysis, design predictions and frame recommendations.

2019- Lenskart in order to further propel its brand and create a thrust has appointed Lowe Lintas, Bangalore, for building online as well as offline brand campaigns for the company. 

About the Parent company

Valyoo Technologies is a start-up e-commerce company founded by Peyush Bansal in 2007. The company has launched businesses like ‘SearchMyCampus’, ‘Watchkart.com’, ‘LensKart.com’, ‘JewelsKart.com’ and ‘Bagskart.com’.

Business Model

Lenskart offers a wide range of Eye wears under its umbrella, ranging from Eyeglasses, Sunglasses & Contact lenses. Apart from the eye care products, the company also offers services in the form of trying frames at home as well as getting eyes checked at home.

The business is built on the ‘No Middleman’ policy, allowing the company to procure straight from the manufacturers and get rid of all extra costs & burden. The company follows an omni-retail channel, with both offline & online stores. Lenskart is expanding its business across the country following the franchise model; the number of stores of the company is expected to cross 500 mark very soon.

The company has manufacturing locations in India & China and apart from manufacturing its products in-house also gets it contract manufactured. Lenskart is India’s only brand which uses robotic technique capable of delivering micro-precision glasses with 0.00 degree power error. Lenskart has managed to create high standards in the form of quality of material, usage of latest technologies for manufacturing, fast delivery, after sales support in the form of warranty and return policy.

In December 2018, the company was selling more than 350,000 spectacles a month and spectacles formed 80% of the company’s revenues. The company’s 60-70% of the business is driven through the online sales. Amongst the total online buyers of the company, around 60% of them are from Metros while the remaining are from the Tier 2 & 3 cities.

Key Fundings

October 2011- Valyoo Technologies P Ltd, parent company of Lenskart raised $4 million in first round of funding from ‘IDG Ventures India’. The company raised the capital for scaling up the product range, marketing activities and building a superior customer centric services through phone and on-line chat.

February 2013- In Series B funding round, the company raised $10 million from Ronnie Screwvala-led ‘Unilazer Ventures’ & ‘IDG Ventures India’.

January 2015- In Series C round Lenskart raised $21.9 million (~Rs 134 Crores) from ‘TPG Capital’ (owner of Vishal Megamart stores), Hong Kong based investment firm TR Capital. The funding valued the firm close to $100 million.

May 2016- In another round of funding the company raised Rs 400 Crore thus, valuing the company in a range of $240-$250 million. The Series D round was led by ‘International Finance Corporation’ which pumped Rs 171 Crore into the venture. With investment from Swiss investment firm ‘Adveq Management’, the funding also saw ‘Ratan Tata’ & ‘Kris Gopalakrishnan’ investing in their individual capacities.

September 2016- The Rs 2 billion funding from ‘PremjiInvest’ marked the partial exit of IDG Ventures. Premji subscribed to fresh equity shares worth Rs 65 crore while the balance amount was used to buy the shares of IDG Ventures. The funding valued the firm at Rs 1800 Crore or $270 million.

January 2017- Ronnie Screwvala led ‘Unilazer Ventures’ increases his stake in Lenskart to 19% by investing additional Rs 24 Crores. The deal valued the firm at Rs 2000 Crore.

August 2018- Hong-Kong based hedge fund ‘Steadview Capital’ along with late-stage technology focused investment firm ‘Epiq Capital’ bought out the stakes of TPG Growth, Ronnie Screwvala led Unilazer Ventures & IDG Ventures India. The deal valued the company at about Rs 3400 Crore.

May 2019- Existing investor ‘Steadview Capital’ in a secondary investment round of $12-20 million has picked up stakes from ‘Unilazer Ventures’ & ‘TR Capital’. Steadview’s shareholding in the company increased from earlier 5% to around 9-9.5% at present.

May 2019- Lenskart is in talks with ‘SoftBank Vision fund’ to secure $350 million, valuing the company at $1.3 billion. This transaction would make Lenskart to join the “Unicorn club”.  

Financial Performance

As per the filings with the ROC, Lenskart reported a 70% jump in its total revenues which increased from Rs 182 Crores in FY 17 to Rs 310.98 Crore in FY18. In FY19, Lenskart is expected to have earned revenue of over Rs 500 crores with around Rs 70 Crore in losses but not yet published the data.

Competitors

Amongst the rivals of Lenskart, the first name is of Tata’s Titan which owns retail eyewear stores under the brand of ‘Titan Eye Plus’. Titan Eye Plus has successfully positioned itself as a fashion accessories label, with the help of consumer trust associated with its label. Apart from Titan, French lens maker ‘Essilor Interenational’ is the next big player. Other small players like Himalaya optical, IDEE and GKB Opticals are working hard to improve their presence in the market.

Founder’s Vision

Peyush Bansal wants to scale up its manufacturing activity and expand its offline presence of the stores from the current 120 cities to 500 cities with over 2500 outlets in the coming 10 years. For this, the company is identifying routes such as setting up smaller stores of about 200 sq. ft. and formats such as shop-in-shop.

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Disclaimer: The report only represents personal opinions and views of the author. No part of the report should be considered as recommendation for buying/selling any stock. The report & references mentioned are only for the information of the readers about the industry stated.

 

 

 

 

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