Ethik
Initial Ask – Rs.15 lacs for 5% equity at a valuation of Rs.3 Cr.
About the Company
This is a premium non-leather brand, which manufactures products having attributes similar to that of leather, using science, technology and innovation made fabric. It is a PETA approved non-vegan brand that uses microfiber, a nylon based material to produce high quality products.
It is a purpose driven brand which had been operating only through offline stores till 2018. After taking a sabbatical for 2018-2020, they launched their website through which sales were made.
Past performance of the Company
From their onset in the year 2013, they made Rs. 78-80 lacs till 2018. After this period, they started off again from Jan 2020, and made a sales of Rs. 25 lacs till Oct-Nov 2021. Main reason for these numbers has been their overpricing (shoes till Rs. 6000, wallets of Rs. 2500).
Industry Overview
Leather footwear industry is expected to grow at a rate of 5% globally, whereas on the other hand, we have the emerging vegan/non-leather footwear segment, which has the prospects of growth by 6.8%. This is expected on the account of increasing concerns over animal cruelty and search for eco-friendly solutions to every single thing. Moreover, this is also helping the companies to reduce their carbon footprints and work towards the cause of climate change.
Despite these benefits, this industry currently has a low penetration because of its premium pricing, thus catering to the niche segment only. This is the reason that leading brands such as Gucci, Versace, Burberry, and Chanel have just joined the club. Thus, this industry still has a long way to takeover the footwear industry.
Previous Equity Split/Investments
Previously, the company received an investment of Rs. 95 lacs from Bharat Ranka, holding 60% of equity of the company. Rest of the 40% is with the founder himself.
Offers made, and the one accepted:
None of the sharks made an offer to the company on account of lack of improvisation and scalability.