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Thrasio forays into India, commits investment of $500 million

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Thrasio has committed an investment of $500 million in India, which the US-based company says will be a massive market for digital shopping, making it a high-priority entry for Thrasio.

Thrasio forays into India, commits investment of $500 million
At a time when the ‘Thrasio’ model is fast-catching up in India, where companies acquire brands and then help them grow, Thrasio, the US-based company behind the model is entering the Indian market.
Thrasio has committed an investment of $500 million in India, which the company says will be a massive market for digital shopping, making it a high-priority entry for Thrasio.
“India is a unique market with hundreds of thousands of motivated entrepreneurs. We are thrilled to provide brand owners with the opportunity to successfully sell their businesses as well as to give consumers greater access to quality products,” Carlos Cashman, CEO of Thrasio said.
Founded in 2018 by Cashman and Joshua Silberstein, Thrasio has acquired more than 200 brands globally and raised more than $3.4 billion (USD) in funding, having surpassed $1 billion in revenues in 2021.
Globally, Thrasio follows a model where it identifies fast-growing brands on Amazon, mostly through Fulfilled by Amazon, acquires them and then works with brands to scale them.
The US firm will be foraying into India by acquiring Lifelong Online, an Indian online consumer brand, which will now be called “Lifelong, a Thrasio company” and will lead the on-ground execution for Thrasio headed by Lifelong’s co-founder and CEO Bharat Kalia.
Lifelong Online was founded in 2015 by Atul Raheja, Varun Grover, and Kalia and sells products across categories such as home and kitchen, lifestyle, fitness, healthcare, among others.
In India, Thrasio is eyeing acquisitions of digital-first and direct-to-consumer (D2C) brands, mainly across the home and fitness categories. However, the firm is likely to steer clear of certain categories such as fashion.
“Products that are in fad and where there's a high level of choice involved, for example, fashion, or things that go in and out of fashion, that's hard for us to scale even with all the expertise that Thrasio and Lifelong bring together. And so those are the categories we tend to stay away from,” Kalia told CNBC-TV18.
In terms of companies, the US giant is eyeing both small and larger brands – companies that are doing a few crore rupees in revenue to those clocking a revenue of over Rs 100 crore annually.
“If the products are great, if customers love them, they are rated very well, if they are ranked very well. That's what we are looking for. It doesn't matter what size the companies are,” Kalia added.
In addition, Thrasio will help take Indian brands it acquires global while bringing its global brands to India. Cashman says the company is also looking at transitioning manufacturing for some of its products to India.
“We expose brands to a much larger customer base. As lifelong, we're across all distribution channels in the country, including digital, D2C, modern trade. Internationally, Thrasio is present in the US, Canada, all across Europe, China and Japan. So brands we acquire get access to a market across the globe,” Kalia said.
Lifelong, on the other hand, Kalia said, will offer value addition to Thrasio’s brands in India using its pan-India distribution network, supply connects, backward integration into manufacturing, along with digital marketing engines.
India’s mushrooming Thrasio-style startups
Thrasio’s entry to India comes at a time when the country has seen the mushrooming of several startups modelled around its model. These include Mensa Brands, GlobalBees, 10Club, Upscalio and GOAT Brand Labs.
Though still at a nascent stage, these startups have seen immense interest from Venture Capitalists.
Mensa Brands, founded by former Myntra CEO Ananth Narayanan in April 2021, became India’s fastest unicorn (second fastest globally) after raising $135 million in Series B funding round led by Alpha Wave Ventures (Falcon Edge Capital). It is also backed by Accel Partners, Norwest Venture Partners, Prosus, and Tiger Global Management.
Mensa has so far acquired 16 brands, including its most recent acquisition of personal care D2C startup Florona and leather Brand Estalon before that.
Global Bees, on the other hand, turned unicorn in December 2021 after raising $110 million in a Series B funding round led by Premji Invest, reportedly valuing the company at over $1.1 billion. The company earlier raised one of the highest Series A financing rounds in India at $150 million led by First Cry.
Global Bees has a portfolio of 11 brands with most recently added The Butternut Company, Mush and Strauss. Other brands include andMe, The Better Home, Yellow Chimes, Prolixr, among others.
Goat Brand Labs, raised $36 million last year from Tiger Global, while 10Club raised $40 million in a seed round led by Fireside Ventures.
Thrasio says competition is good in India given the scope of the market.
“India is hardly penetrated in terms of e-commerce even as more customers are coming online, Tier 2, 3 markets open up. And the likes of Amazon, Flipkart, Snapdeal and Jiomart have done a fantastic job in creating the ecosystem to get India online and get them shopping online. If customers continue to buy, then products will be made for them. And there's more and more opportunity there for companies like us to both build and buy great products. So good competition is great,” Kalia said.
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