Home décor startup Livspace, backed by US private equity firms TPG and KKR, had a significant rise in its topline and improved financial health in the year ending in March 2023, a senior official told VCCircle.
“We achieved a top-line growth of 85% across the business, with our revenue reaching nearly ₹1,100 crore,” Livspace chief strategy officer Ankit Shah said in an interaction.
According to Shah, the company’s growth in the fiscal year was fueled by business development, investment in branding and experience centers, and improved supply chains.
By the end of March 2021, Livspace was present in six to seven cities. By the end of FY23, Livspace was operating in 45 to 50 cities.
Livspace’s earnings before interest, taxes, depreciation, amortization, or Ebitda margin before employee stock options increased from -95.2% in FY22 to -50.7% in FY23, indicating a better financial position. As a result, the Ebitda loss before ESOPs decreased to around 581 crores from over 600 crores in FY22.
According to Shah, the company’s absolute gross profit increased by 140% over the year, while the real margin increased by 10%, from around 30% to 40%.
“We have delved deeper into the supply chain. Our efforts and energy have been significantly invested in negotiating with vendors and sourcing materials,” he added while explaining how the company lifted its margins in FY23.
“In the past few months, our India business, which constitutes approximately 80% of our operations, has achieved an EBITDA margin before ESOPs in the late teens. We’re looking to break even by the end of this fiscal,” Shah said.
An omni-channel platform for home interior and restoration, Livspace was established in 2014 by Ramakant Sharma and Anuj Srivastava. It has operations across Southeast Asia, India, and the Middle East.
A funding round led by KKR in February 2022 raised the company’s latest $180 million, valuing it at $1.2 billion and elevating it to the coveted unicorn club. There have been several rounds of funding totaling roughly $450 million.
The company is betting on the future expansion of India’s real estate sector, which is recovering from the lows of the COVID-19 pandemic.
“We’re strengthening our presence in the current 45 cities and plan to expand to around 100 cities in the coming year. This expansion includes adding more experience centres in the cities where we already have a presence,” said Shah.
