Homevista Decor & Furnishings Pvt. Ltd, the parent company of interior brands HomeLane, Doowup, Cubico and Wrapzap, said on Wednesday that it is acquiring its rival DesignCafe.
VCCircle exclusively reported the development of HomeLane acquiring DesignCafe in November last year.
This acquisition, subject to regulatory approvals, will result in the creation of the largest entity in the interiors category in India, in terms of projects delivered, the company claimed, as it pegged the valuation of the combined entity at around Rs 3,000 crore (nearly $360 million).
Post-acquisition, HomeLane, Doowup, and DesignCafe will continue to operate as distinct end-to-end interiors brands.
The combined entity is targetting a revenue of Rs 1,000 crore in the financial year through FY25, up 33% from Rs 761 crore in FY24.
The merged entity is also aiming to remain EBITDA profitable for the fiscal. "The combined entity is already at a revenue ARR of Rs 900 crore, is cash profitable and at -2% EBITDA," said Srikanth Iyer and Tanuj Choudhry, co-founders of HomeLane.
“I believe that this transaction brings together two teams that are now the clear leaders in the home interior space. Both teams have shown strong execution in the past, and together, we believe that they will deliver industry-leading performance for all stakeholders,” said Sandeep Singhal, managing partner of Westbridge Capital and investor in DesignCafe.
In conjunction with the acquisition, HomeLane also raised a Rs 225 crore funding round from both existing investors of HomeLane and DesignCafe, as well as external investment from Hero Enterprise.
"Our investment reflects confidence in their business model and it also presents meaningful synergies with Hero Realty," said Sunil Kant Munjal, chairman of Hero Enterprise.
Prior to this, HomeLane raised Rs 75 crore ($9.1 million) in a bridge funding round from its existing backers. The company is also backed by Pidilite, Evolvence, NuVentures, Peak XV Partners, and Accel.
Founded in 2014 by Iyer and Choudhry, HomeLane provides end-to-end personalised home interior makeovers. In the financial year ended March 2023, the startup grew its revenue by 40% with an annual revenue rate of Rs 1,000 crore.