Peyush Bansal’s Lenskart may now be valued at over $4 billion
Peyush Bansal’s eyewear firm Lenskart has raised 760 crore in a new financing round, according to regulatory documents.
The funds were provided by Alpha Wave Incubation, which was called Falcon Edge. According to regulatory papers obtained by Business Insider, Lenskart approved a special resolution authorising 36,41,646 Series I for Alpha Wave Venture to raise 760 crore. The issue price of each equity share is $2,087.52.
Entrackr was the first to report on the development. According to the journal, Lenksart was valued at $4.3 billion following this round based on their estimations.
The news comes nearly a year after the business secured $95 million in a round led by KKR in May, valuing the company at $2.5 billion. TPG Growth and TR Capital, which had previously invested in the company, sold a part of their stock in this round.
Lenskart intended to use the funds to grow its domestic and international operations. “In the next five years, we want half of India to be wearing our glasses.” “Today’s announcement represents a watershed moment and a step toward that aim,” Bansal said after the round was announced.
Consumers can receive home eye tests, 3D try-on, and home trials as part of an end-to-end experience. The organisation claims to serve over 7 million customers every year through its extensive network.
It has more than 175 sites and 1000 stores. The company has raised nearly $900 million, according to Crunchbase, a business information website. Its backers include Temasek Holdings, SoftBank Vision Fund, Bay Capital, Chiratae Ventures, etc.
With headquarters in New Delhi, Lenskart is an Indian optical prescription eyewear store network. As of September 2020, Lenskart had 500+ locations in over 40 Indian cities. Its manufacturing facility in New Delhi produces 3 lakh glasses each month.
Revenue and Appraisal
Softbank invested $2 million in the company in December 2019, valuing it at $1 billion. Peyush Bansal, a former Microsoft employee, co-founded Lenskart with Amit Chaudhary and Sumeet Kapahi in 2010. By 2020, Lenskart hopes to generate more than 1,000 crore in revenue. Lenskart’s investors include TPG Growth, International Finance Corporation, and Adveq Management.
Ratan Tata and Kris Gopalakrishnan have invested in Lenskart. In March 2018, Wipro’s Chairman Azim Premji made a Rs. 4 crore investment in the company, valuing it at Rs. 3,000 crore.
The company made a profit in 2018. The John Jacobs eyeglasses line debuted on Lenskart in 2017. SoftBank, a Japanese conglomerate, and Kedaara Capital, a private equity firm, are both interested in investing in the company. In October 2017, Katrina Kaif became Lenskart’s first brand ambassador. In March 2019, Bhuvan Bam was named the company’s first male brand ambassador.
How does Lenskart work?
Lenskart is a well-known e-commerce company that operates an online optical store with a wide selection of affordable eyeglasses, lenses, and other accessories. Customers can easily order these glasses online and have them delivered with many discounts that come and go.
Lenskart, unlike many other companies, has an online and physical distribution platform. Lenskart is transforming the eyewear market with the first-of-its-kind ‘Home eye checkup.’ It employs sophisticated robots to deliver the right glasses to three decimal places.
Lenskart has over 5000 distinct eyewear models to choose from, with free home delivery and a 14-day replacement guarantee. The company makes everything in the eyewear sector, from sunglasses to reading glasses to contact lenses.
Product, quality, portfolio, delivery time, and after-sales service are the three success factors in this industry. Their value proposition is simple: provide a high-quality product at an affordable price.
Lenskart – Industry and Target Market Size
In 2021, India’s eyeglasses market will generate roughly $4,427 million in revenue. Spectacle lenses have been the market’s largest category, with a market volume of $1,985 million.
When the operation’s concept is novel and supported by capable investors like Softbank, Alpha Wave, and Ratan Tata, tapping into one of these markets can be very rewarding.
Lenskart was founded with the aim of giving India a “vision.” In line with this, Lenskart Lite, a low-cost franchise model targeting upcountry regions, mainly tier 3 and 4 markets, was recently launched. A Rs 20 lakh investment is needed for the model aimed at micro-entrepreneurs. The format generates around Rs 4-6 lakh in revenue every month. They already have a basic Lenskart franchise plan for tier-2 regions, with a Rs 35 lakh investment criteria and monthly revenue estimates of Rs 8-10 lakh.
Lenskart – Name, Logo, and Tagline
The company edited the three most widely known frame shapes – a square, a circle, and a triangle – to create slightly more abstract forms, and this is how the Lenskart logo was created.
Lenskart’s tagline is “Log on, Play on!”.
Founders, Owners, and Team
Peyush Bansal, Sumeet Kapahi and Amit Chaudhary are the founders of Lenskart.
Peyush Bansal is the CEO and creator of Lenskart’s parent business, Valyoo Technologies. He is a Delhi native who attended Don Bosco High School. He hoped to pass the IIT admission exam, but he failed, luckily or regrettably. He eventually decided to study Electrical Engineering at McGill University.
He earned a Bachelor’s degree in Electrical Engineering — IT, Control, and Automation from McGill University in Canada in 2006. Soon after, the founder of Lenskart earned a job with Microsoft, the world’s largest software company. Peyush worked with Microsoft for a year as a Program Manager. When working for Microsoft in Seattle, he met Bill Gates since Gates liked to invite his company’s interns to his beach house. At this conversation, Bansal realised that Gates had accomplished something monumental by founding Microsoft and that he didn’t want to be a part of a firm with over 50K workers; instead, he wanted to be known for his work.
He found that he was improving the lives of those who were already prosperous. This is why he returned to India to address the problem of vision repair and lending vision to the public through Lenskart. He eventually moved to IIM, Bangalore, to pursue his master’s degree in management.
Bansal subsequently developed several Indian firms, like john Jacobs, AQUALENS, and Lenskart. He established Lenskart Vision Fund and Lenskart Plus, all of which cater to the spectacles and lenses sector.
He started Valyoo Technologies while at IIM, which launched SearchMyCampus as the first commercial portal in 2007. In addition to housing, it was a student classifieds platform that included books, part-time work, carpooling, and internship opportunities. His motto was to assist pupils with any issues they might be having.
SearchMyCampus was a big success, so Peyush wanted to expand it into the e-commerce market. He stumbled upon the eyeglass sector while hunting for prospects, which was mainly disregarded by the major e-commerce firms, like Amazon and eBay.
Flyrr, a website dedicated to the American eyeglasses industry, was founded by him.
Flyrr’s business was gaining traction, so he decided to try his luck in India, launching Lenskart in November 2010. This new brand started off selling contact lenses solely, but after a few months, it expanded to include eyeglasses. Finally, in March 2011, the company was able to add sunglasses to its repertoire, classifying them as a fashion item.
Peyush Bansal, co-founder, and CEO of Lenskart is presently a judge (Shark) on the latest business reality show, Shark Tank India. Bansal is known for his cooperative approach, encouraging demeanor, belief in brands, and several reasons he provides to the applicants. He is nicknamed the “kindest shark” on the show. For example, in one Shark Tank episode, Peyush Bansal gave Sidharth from Jammu a non-negotiable offer of Rs 25 lakhs for 75 percent ownership and Rs 22 lakhs in debt which was derided and abused by the other judges.
Peyush encouraged him by pointing out his and Sidharth’s similarities. In an episode of Shark Tank, Peyush Bansal went on the stage and sought the judges for a Rs 1 crore investment in his company in exchange for a 1% stake. He repeated the proposal he made in 2010 when he was only 26 years old, and it changed Lenskart’s future. With his Lenskart pitch, he replicated the same magic.
Trolls, counter-questions, and admiration were the responses to his pitch. On the other hand, his pitch surely enthralled, enthused, and motivated Lenskart consumers, business professionals, current entrepreneurs, and aspiring entrepreneurs and helped them learn far too much about the brand and its co-founder.
Neha Bansal is a co-founder who formerly worked as a Partner at Vinod Kumar and Associates before joining Lenskart. Bansal went on to start DNS Advisors and serve as its Founder and Director.
Sumeet Kapahi is the co-founder and a graduate of the University of Delhi.
Another co-founder is Amit Chaudhary. Chaudhary earned his bachelor’s degree in information technology from the Birla Institute of Technology in Mesra.
A list of owners can be found on Lenskart. Softbank owns most of the company’s holdings, accounting for 20.12% of the total. Premji Invests next, with 11.15 per cent of the stakes. Kedaara Capital holds 9.55 per cent of the stock, while TR Capital owns 8.28 per cent of the stock. Peyush and Neha Bansal own 8.21% and 8.18% of the company.
The company’s other owners are:
6.59% – UNILAZER
5.36% – International Finance Corporation
5.32% – Steadview Capital
17.24% – Others
Lenskart Success Story of Providing Vision to India
A third of India’s population requires spectacles today. People who have been diagnosed with vision problems are referred to as “needing” spectacles, yet only around a quarter of them actually wear them. The amount of people who opt to wear glasses as a fashion accessory is startling when totaled. Customers in this category want multiple pairs of eyeglasses to match several outfits. About 1.5 million spectacles (15 lacs) are sold in India every day. The market is highly fragmented, with mom-and-pop stores dominating. Since 2010, when Lenskart was founded, the eyewear industry has changed.
Lenskart is an optical prescription eyewear retail business established in Faridabad, India, that operates as an online marketplace for prescription power glasses, BLU glasses, frames, and goggles. Furthermore, it focuses on physical stores. As of December 2021, it had already established over 80 retail locations across India. Each month, its Delhi manufacturing unit produces around 300,000 glasses. It has a factory in Zhengzhou, China that handles nearly 20% of its production of frames.
The company, which is hailed as India’s largest eyewear brand, and is recognised as a unicorn prescription eyewear company, has joined the exclusive club of Indian unicorns in December 2019.
Lenskart – Startup Story
Only a third of the population requires glasses, and only a few have been able to obtain them. In addition, India is known as the world’s blind capital, with almost 15 million blind people as of last year. The main reason for Peyush Bansal’s decision to start “VALYOO technologies” is because of this.
In terms of the most recent disclosures from Peyush Bansal’s Shark Tank pitch episode, we now know that when he first started with Lenskart in 2010, he learned that around half of the population needed eyeglasses. Still, only a quarter of them has access to them. This is why Bansal set out to revolutionize vision correction by requiring 50% of the population to wear glasses. The co-founder of Lenskart aspired to make his company the “Maruti of eyewear.”
Mission and Vision
“Our objective is to give India a vision,” says Lenskart, the world’s fastest-growing eyeglasses firm with the largest online presence.
Lenskart – Product and Services
Lenskart has over 5000 frames and glasses to choose from and over 45 different lenses. Its product offerings range from –
- Shape – Wayfarer, Oval, Rounders, Cat Eye
- Size- Small, Medium, and Large
- Brands – Bausch and Lomb, Johnson & Johnson, Alcon
- Color Contact Lenses, and many more.
Lenskart is a B2C company with an inventory-driven business plan that sources equally from India and China. Its in-house stylists and designers stay on top of the most recent eyewear trends. These designs are then given to the producers. The corporation can keep expenses low by managing the entire supply chain.
It has opened offline storefronts using a franchisee model to reach the masses. It presently has more than 50 locations in 30 cities, to get 50 by the end of the year.
Lenskart broadened its coverage across urban and non-metro locations to attain a decent balance.
It serves 4000 customers every day, with plans to grow to 200,000 in the following years. It has a staff of almost 1000 employees working on this project, which spans sectors including manufacturing, eye technicians, customer service, IT, and logistics. It will continue to expand as the firm grows. It operates based on a business model in which the firm accepts orders for power glasses after receiving power from consumers, but it is now preparing to test power for customers, which will be feasible in the coming days.
Funding and Investors
According to sources dated April 11, 2022, Lenskart raised $100 million in its most recent fundraising round, led by Alpha Wave Incubation, previously called Falcon Edge. Temasek and Alpha Wave Global led Lenskart’s last $220 million investment round, which closed on July 19, 2021. The Secondary Market round, in which the firm raised $95 million, and the Series G round, sponsored by SoftBank Vision Fund for $275 million on December 20, 2019, were both key rounds for the company.
As of December 22, 2021, Lenskart had raised $874 million in investment.
Revenue and Growth
Lenskart’s operational revenues increased by less than 1%, from Rs 900.2 crore in FY20 to Rs 905.3 crore in FY21.
The sale of Lenskart products through physical stores and online apps/websites is the brand’s main revenue generator, accounting for 94.5 per cent of total revenue. This revenue stream stayed pretty steady, from Rs 851.2 crore in FY20 to Rs 855.7 crore in FY21. Another 4.6 per cent of the company’s operating revenue increased by over 11%, from Rs 37.2 crore in FY20 to Rs 41.24 crore in FY21. In FY21, it gained another Rs 8.4 crore by providing ancillary services like eye exams and more.
Lenskart Solutions had only two outlets in Singapore in FY2019, but it now intends to lead the market and earn over $30 million (INR 217 crore) in revenue.
However, Lenskart’s expenses increased by 3.7 per cent from Rs 963.14 crore to Rs 998.80 crore in FY21, with raw materials and spares utilized in the production of eyeglass goods being the major cost center. It earned a single rupee of revenue by spending Rs 1.1 in FY21, according to the unit level. In terms of profit and loss, Lenskart had a 4.6X increase in profits, which now stand at Rs 28.92 crore in FY21, up from roughly Rs 6.32 crore the last fiscal.
The following are some of Lenskart’s key growth indicators:
- Lenskart is ranked as one of India’s top three optical retailers. Every month, the organisation communicates with approximately 100,000 customers.
- In the last two years, it has grown by more than 200 per cent.
- Lenskart claims to have over 5000 eyewear styles, which is 5X more than any other retailer in India.
Lenskart – Competitors
Lenskart is up against both offline and online competitors that include:
- GKB Opticals
- Vision Express
- Titan Eyeplus
Lenskart – Challenges Faced
The most challenging task Lenskart had was getting customers to use the online store instead of going to the store. The company needs to change people’s perceptions of eyewear and gain their trust by demonstrating that they provide high-quality products at lower rates than its brick-and-mortar competitors.
The retail stores, desktop platforms, and smartphone apps for Lenskart all did exceptionally well. However, the mobile website converted the fewest visits into consumers compared to their other sites. The client used that touchpoint to direct customers to their mobile apps as a stopgap measure until they could invest the resources needed to revamp the website completely.
Lenskart – Future Plans
The “Vision to India” vision of Lenskart India is to reach the masses by creating a low-cost franchise model. Lenskart Lite is a model that will aid in introducing the framework in Tier 3 and 4 cities and the expansion of their presence in Tier 2 cities. It introduced disposable contact lenses that may be thrown away easily. With the help of their Aqualens product, Lenskart hopes to deliver economical and simple eyeglasses options.
At just Rs.40 per day, it would be highly affordable to the everyday masses who desire both styles and costs.
Lenskart India’s major goal is to close the gap between picked and unselected lenses, and the company plans to open over 500 outlets in the next two years. By the end of the next five years, it hopes to have 2,000 locations open.
How Lenskart has revolutionized the Eyewear Franchise Industry
The unorganized portion of the eyeglasses market in India dominates. Still, the organized segment is rapidly gaining ground and is expected to rise at a CAGR of more than 9% to reach $13.6 billion by 2024.
The eyeglasses business has experienced enormous growth in recent years, converting itself from a near-stagnant market to a promising one. With the advancement of technology, people may now have their eye exams done in their own homes.
The expansion of organized retail establishments in India’s eyeglasses business has allowed these improvements to occur. Lenskart, a franchise company, has revolutionized the Indian eyeglasses business.
In 2010, Lenskart celebrated its tenth anniversary. The company has attained full-stack business during the last ten years and is now India’s fastest growing eyeglass business.
According to Lenskart, 60 crore people in India require eyeglasses just to see. Only 30 crore of these 60 people wears eyeglasses, with the remainder unable to do so due to a lack of access. In addition, just 30,000 optical retailers serve a population of 1.3 billion individuals.
Lenskart’s goal is to help reduce this number slightly in the coming years by focusing on this market size. The company believes it can achieve this by supplying high-quality eyewear at low costs to millions of Indians, giving free eye checks at home, and expanding its services to the most remote parts of the country.
Amid COVID, how is Lenskart responding to changing consumer expectations?
Lenskart adheres to basic sanitation guidelines. It cleans all of the frames that customers use daily. Other hygiene aspects have been actively invested in by the company, like installing UV sanitizers in the store to take extra precautions. Lenskart now has a cueing system, which allows only a certain number of persons to enter the store while maintaining social distance rules.
The brand is ensuring that all new-age technologies are utilized, which will impact not just today but in the future.
Lenskart promises to be one of India’s sanitary retail businesses today.
“We made sure that our production stays working during lockdown because this is a medically necessary product,” said Amit Chaudhary, COO of Lenskart Solutions Pvt. Ltd. We had around 400 people at our plant were coming even during COVID times. We ensured that they stayed inside the factory for their safety while serving the consumers. About a month when no one else in India could have provided you with a spectacle save us.”
For its customers, Lenskart has also offered new items. During this period, its Blue Cut Glasses became more popular.
During the lockdown, the business built omnichannel technology, which allows it to connect its online and offline customers.
The Lenskart LITE model is attracting micro-entrepreneurs.
To attract micro-entrepreneurs, the company has launched the Lenskart LITE (FOFO) model. A standard Lenskart location requires a capital investment of Rs 35 lakhs, whereas this business model requires a capital investment of Rs 20 lakhs. In Tier IV and V towns, a Lenskart LITE store can produce monthly revenue of Rs 4-6 lakhs.
The Lenskart LITE (FOFO) model was created for a smaller scale store and features a simple yet appealing appearance. This approach is designed to produce high margins and ROI while allowing for a shorter payback period.
Helping franchisees in achieving higher ROI
Lenskart ensures 25-30% margins throughout its franchise models, zero stock risk, and quick breakeven within two years to provide strong ROI to its franchise partners.
In addition, the company provides complete support to its franchisees in terms of site selection and approval, shop layout and design, personnel hiring, and training. Lenskart keeps track of franchisees’ NPS regularly and provides training to help them maximize revenue.
SoftBank-backed Lenskart raises $220 million as India’s tech industry booms
Lenskart raises $220 million from Temasek Holdings Pte and Falcon Edge Capital as India’s tech industry grows. Peyush Bansal founded the company in 2010, and it offers eyeglasses, contact lenses, and sunglasses online and through around 750 retail locations across India. It expects to utilize the funds and $95 million raised earlier this year from KKR & Co. to boost online sales and open physical locations in India, Southeast Asia, and the Middle East.
“Every vertical, except eyewear, has been disrupted globally,” Bansal said during a video conference to announce the funding. We could easily spend two decades addressing the issue of eyeglasses awareness, penetration, and cost.” According to the creator, the firm is now valued at $2.5 billion.
Lenskart sold roughly 8 million pairs of eyewear last year and planned to increase that number by 30% this fiscal year. The company claims to be India’s largest eyewear retailer, planning to expand into Southeast Asia and the Middle East. By 2025, the total market opportunity is expected to be worth more than $15 billion. India’s technology sector is having a banner year. Hundreds of billions of dollars are being invested in the country’s startups, resulting in the creation of more unicorns than ever before. Those investments are beginning to bear fruit.
Zomato Ltd., a food-delivery service, recently became the country’s first unicorn to go public, raising $1.3 billion. Paytm, a digital payments company, has submitted a draught prospectus for what might be the country’s largest IPO ever.
Lenskart launches Vision Fund for select startups in the eye-care space
Lenskart, an omnichannel direct-to-consumer eyewear company, has announced plans to invest up to USD 2 million in companies in the eyewear, eye-care, and omnichannel retail sectors. The fund has a total asset value of USD 20 million.
Aside from that, the company stated in a news statement that it would provide market access to the businesses through 700+ retail shops and online channels across India, Singapore, the Middle East, and the United States.
During the early stages of business development, the company’s senior leadership team will coach the businesses. It’s a program aimed at assisting startups in their growth.
“We have crossed the tough route as a company to become a unicorn,” stated Peyush Bansal, the founder, and CEO of Lenskart, at the event. We believe it is past time to give back to the ecosystem by assisting great entrepreneurs in building viable businesses.”
Direct-to-customer eyewear, eye-care brands, technologies facilitating access to vision care, eye testing technologies, omnichannel retail solutions spanning logistics, supply chain, merchandising, marketing, in-store automation, and deep tech solutions for eyewear, retail, and e-commerce will be the main focus sectors for investment.
Lenskart was looking to expand its presence in India and scale its growing operations overseas.
edited and proofread by nikita sharma