Duroflex gets first funding in three years from Norwest Venture Partners

Duroflex gets first funding in three years from Norwest Venture Partners


Mumbai: Duroflex Pvt. Ltd., which sells mattresses under the labels of Duroflex and Sleepyhead, has raised $60 million in a funding round led by Norwest Venture Partners.

The latest fundraising comes three years after Lighthouse Funds
invested $22 million for a 25% stake in the mattress maker, according to an ET report dated Oct. 29, 2018. Since then, the company has grown three times by expanding online and offline through its two brands.

While Duroflex is an omnichannel brand, Sleepyhead is online only.

“The capital raised will go towards capex, mainly in North India, technology investments in automation of processes and supply chain, product development and front-end customer experience,” Managing Director Mathew Chandy said. “A small portion of the new funding round is secondary where Lighthouse has taken some money off the table.

Duroflex will also look at a smaller follow-on round, given the investor interest.

“We will also look at listing over the next 4-5 years. For now, we will continue to grow our business across geographies and categories,” Chandy said. The promoters currently hold around 70% stake in the company while the rest is held by the two funds, he said.

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A popular offline brand, Duroflex gets 33% of its revenue from online channels. It has a strong business-to-business presence with clients such as Ikea and Stanley. Sleepyhead— as a direct-to-consumer online label—is focussed exclusively on digital-native millennials. The company is eyeing exports now.

“The economic recovery has indeed been ‘K shaped’, and we are fortunate to be on the right side of this recovery,” Chandy said.

Duroflex aims to clock Rs 1,000 crore in revenue in the fiscal ending March 31, 2022, as against Rs 600 crore in the previous financial year. The company has an ebitda margin of about 10%. Ebitda is short for earnings before interest, tax, depreciation and amortisation —a key metric for operational profitability.

“We expect to grow by 30% year on year over the next five years,” Chandy said. This growth, he said, will come from expansion into new markets and products, and exports.

“Duroflex is a very special company that delivers excellence in everything it does; right from its pan-India manufacturing and distribution network to its sharp focus on product quality, innovation and consumer experience,” said Shiv Chaudhary, managing director at Norwest Venture Partners. “Its strong team culture and approach to building a truly omnichannel business is laying the foundation for further scale and a compelling IPO in the future.”

Norwest is a Silicon Valley-based investment firm that has invested in a number of large tech first consumer companies, including Swiggy, Pepperfry, Mensa, Vuori, Udemy, Casper, Calm, Uber, and Spotify.



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