Big news for India’s consumer tech and D2C ecosystem, The Sleep Company, a Mumbai-based sleep solutions startup, is set to raise USD 12.3 million (~INR 105 crore) in its latest Series D funding round. This new money, led by Saffron Investments with Carillon Investments and Infinity Partners participating, is not only a big boost to the company’s war chest but also an 80% increase in its valuation from the previous round.
Details of the Funding Round
The company’s board has approved the issue of 19,093 Series D Compulsorily Convertible Preference Shares (CCPS) at an issue price of INR 55,130 each as per the RoC filings. Here’s how the investment breaks down:
- Saffron Investments: INR 87.73 crore (lead investor)
- Carillon Investments: INR 9.74 crore
- Infinity Partners: INR 7.77 crore
The investment of INR 105 crore (USD 12.3 million) will be used for the company’s growth plans, market expansion and general corporate purposes. The filing mentions this is the first tranche of the investment.
Valuation Growth
The Sleep Company is now valued at INR 2,745 crore (USD 323 million) as per estimates, up from INR 1,500 crore during its Series C round in December 2023. That round, which raised USD 22 million (~INR 192 crore), was led by Premji Invest and Fireside Ventures.
Saffron Investments will hold a 3.2% stake in The Sleep Company post this allotment. The company has raised about USD 49 million (~INR 399 crore) so far.
Business Performance and Future Plans
Founded in 2019, The Sleep Company has quickly become a big player in India’s D2C (direct-to-consumer) sleep solutions market. They offer mattresses, pillows, cushions, bedding and even office chairs and have used both online and offline channels to build the brand and reach.
For the year ending March 2024, The Sleep Company did INR 312 crore in revenue—a 2.5X growth from INR 127 crore in FY23. But this period of rapid scaling also saw their losses increase by 58% to INR 58.69 crore.
They are still ambitious and are in talks to raise another USD 50 million (~INR 437 crore) from ChrysCapital in a mix of primary and secondary transactions. The proceeds of this round will be used for business growth and expansion and general corporate purposes.
The Competitive Landscape
As the sleep solutions space gets competitive, The Sleep Company is in the same league as Wakefit, which has filed a DRHP with SEBI to raise INR 468.22 crore through a fresh issue and other peers like SleepCat and Duroflex.
Conclusion
The Sleep Company’s latest fundraise is a vote of confidence by investors in the D2C mattress and sleep solutions space. With a new valuation and a lot of capital, the company is all set to ride the growing demand, innovate in the space and get a bigger share of India’s rapidly changing consumer landscape.
For more details related to IPO GMP, SEBI IPO Approval, and Live Subscription, stay tuned to IPO Central.