Online furniture rental startup RentoMojo is preparing to file for an IPO within the next 18 months,͏͏ as͏͏ stated͏͏ by͏͏ its͏͏ founder͏͏ and͏͏ CEO,͏͏ Geetansh Bamania.
Achieving͏͏ Profitability͏͏ Amid͏͏ Industry͏͏ Challenges:
According͏͏ to͏͏ an͏͏ ET͏͏ report,͏͏ RentoMojo͏͏ achieved͏͏ profitability͏͏ in͏͏ FY23,͏͏ distinguishing͏͏ itself͏͏ in͏͏ an͏͏ industry͏͏ where͏͏ many͏͏ competitors͏͏ have͏͏ faced͏͏ challenges͏͏ with͏͏ sustainable͏͏ unit͏͏ economics.
“When͏͏ Covid͏͏ began͏͏ in͏͏ March͏͏ 2020,͏͏ we͏͏ expected͏͏ to͏͏ achieve͏͏ profitability͏͏ by͏͏ October͏͏ that͏͏ year.͏͏ However,͏͏ the͏͏ situation͏͏ delayed͏͏ our͏͏ plans,͏͏ and͏͏ by͏͏ December,͏͏ we͏͏ found͏͏ ourselves͏͏ facing͏͏ a͏͏ cash͏͏ runway͏͏ of͏͏ only͏͏ 15-20͏͏ days.͏͏ At͏͏ that͏͏ point,͏͏ we͏͏ had͏͏ to͏͏ implement͏͏ layoffs,͏͏ but͏͏ prior͏͏ to͏͏ that,͏͏ we͏͏ managed͏͏ the͏͏ crisis͏͏ by͏͏ reducing͏͏ salaries͏͏ for͏͏ senior͏͏ management͏͏ and͏͏ mid-level͏͏ employees,”͏͏ he͏͏ told͏͏ ET.
Continue͏͏ Exploring:͏͏ Furniture retailer͏͏ Pepperfry͏͏ puts͏͏ IPO plans͏͏ on͏͏ hold,͏͏ shifts͏͏ focus͏͏ to͏͏ growth͏͏ revival͏͏ strategy
It’s͏͏ important͏͏ to͏͏ highlight͏͏ that͏͏ in͏͏ early͏͏ 2020,͏͏ as͏͏ profitability͏͏ seemed͏͏ achievable,͏͏ the͏͏ pandemic͏͏ presented͏͏ several͏͏ challenges͏͏ for͏͏ RentoMojo,͏͏ prompting͏͏ the͏͏ company͏͏ to͏͏ make͏͏ necessary͏͏ adjustments͏͏ before͏͏ ultimately͏͏ reaching͏͏ profitability.͏͏ Bamania͏͏ noted͏͏ that͏͏ this͏͏ period͏͏ fostered͏͏ a͏͏ mindset͏͏ focused͏͏ on͏͏ sustainable͏͏ growth͏͏ for͏͏ the͏͏ business.
“Before͏͏ Covid,͏͏ the͏͏ ecosystem͏͏ was͏͏ such͏͏ that͏͏ whenever͏͏ we͏͏ faced͏͏ pressure,͏͏ we͏͏ sought͏͏ the͏͏ next͏͏ round͏͏ of͏͏ capital.͏͏ This͏͏ time,͏͏ when͏͏ we͏͏ found͏͏ ourselves͏͏ cornered,͏͏ we͏͏ realised͏͏ we͏͏ had͏͏ to͏͏ address͏͏ the͏͏ problem͏͏ independently͏͏ without͏͏ relying͏͏ on͏͏ external͏͏ funding.͏͏ That͏͏ was͏͏ a͏͏ pivotal͏͏ moment͏͏ for͏͏ us,͏͏ as͏͏ we͏͏ began͏͏ scrutinising͏͏ all͏͏ costs͏͏ and͏͏ overheads͏͏ to͏͏ eliminate͏͏ excess͏͏ while͏͏ still͏͏ being͏͏ able͏͏ to͏͏ service͏͏ our͏͏ customers͏͏ and͏͏ grow,”͏͏ he͏͏ added.
Founded͏͏ in͏͏ 2014͏͏ by͏͏ Bamania,͏͏ Achal͏͏ Mittal,͏͏ Ajay͏͏ Nain,͏͏ and͏͏ Gautam͏͏ Adukia,͏͏ RentoMojo͏͏ offers͏͏ leasing͏͏ of͏͏ consumer͏͏ appliances,͏͏ furniture,͏͏ and͏͏ other͏͏ furnishing͏͏ products͏͏ through͏͏ its͏͏ app͏͏ and͏͏ website.
The͏͏ Bengaluru-based͏͏ startup͏͏ asserts͏͏ that͏͏ it͏͏ operates͏͏ in͏͏ 16͏͏ cities͏͏ and͏͏ has͏͏ served͏͏ nearly͏͏ 4.5͏͏ lakh͏͏ customers͏͏ since͏͏ its͏͏ inception.͏͏ It͏͏ also͏͏ reports͏͏ profitability͏͏ for͏͏ the͏͏ last͏͏ 10͏͏ quarters.͏͏ RentoMojo͏͏ competes͏͏ with͏͏ companies͏͏ like͏͏ Fabrento,͏͏ Rentickle,͏͏ Furlenco,͏͏ and͏͏ Cityfurnish.
Financial͏͏ Highlights:
According͏͏ to͏͏ Bamania,͏͏ RentoMojo͏͏ is͏͏ estimated͏͏ to͏͏ have͏͏ closed͏͏ FY24͏͏ with͏͏ INR͏͏ 200͏͏ crore͏͏ in͏͏ revenue͏͏ and͏͏ a͏͏ profit͏͏ after͏͏ tax͏͏ of͏͏ INR͏͏ 22͏͏ crore.͏͏ In͏͏ FY23,͏͏ the͏͏ company͏͏ reported͏͏ a͏͏ net͏͏ profit͏͏ of͏͏ INR͏͏ 6.2͏͏ crore͏͏ on͏͏ revenues͏͏ of͏͏ INR͏͏ 121͏͏ crore.
RentoMojo’s͏͏ Recent͏͏ Funding͏͏ Rounds:
This͏͏ development͏͏ follows͏͏ reports͏͏ from͏͏ months͏͏ ago͏͏ indicating͏͏ that͏͏ online͏͏ furniture͏͏ rental͏͏ startup͏͏ RentoMojo͏͏ raised͏͏ an͏͏ undisclosed͏͏ amount͏͏ from͏͏ ValueQuest͏͏ Scale͏͏ Fund͏͏ during͏͏ a͏͏ Series͏͏ D͏͏ funding͏͏ round.͏͏ The͏͏ investment͏͏ comprised͏͏ a͏͏ combination͏͏ of͏͏ primary͏͏ funding͏͏ and͏͏ secondary͏͏ purchases͏͏ for͏͏ a͏͏ minority͏͏ stake͏͏ in͏͏ the͏͏ company.
In͏͏ February,͏͏ RentoMojo͏͏ raised͏͏ INR͏͏ 210͏͏ crore͏͏ ($25͏͏ million)͏͏ in͏͏ its͏͏ Series͏͏ D͏͏ and͏͏ D1͏͏ funding͏͏ rounds,͏͏ led͏͏ by͏͏ Edelweiss͏͏ Discovery͏͏ Fund͏͏ Series͏͏ –͏͏ I.
