Rare Planet
Initial Ask – Rs. 65 lacs for 1% equity at a valuation of Rs. 65 Cr.
About the Company
Being a platform for thousands of skilled artisans of our country, this company deals in materials like terracotta, ceramic, copper and studio pottery in order to come up with a range of artistic products. Trying to go retail, they first had bookstores to sell their products, post which came airport locations. Dealing in 4 locations, along with their own website, they manage almost around 6000 SKUs. They are such a purpose-driven brand that they have already connected with 10,000 artists so far and work for making them self dependent.
Their products are microwave safe and dishwasher proof too. They have the B2B vertical and B2C vertical through which sales are made. Their vision is to move into malls section once they cover the airport space for reaching out to consumers for their self-consumption purpose too, not just for gifting. They even want to explore clothing, fragrance, spices and many other segments and make it a household brand.
Past performance of the Company
They started off by making Rs. 1.5 lacs during their 1st month of sales. Since then, they came a long way till October 2021, which saw sales worth Rs. 1 Cr. Of this 1 Cr, they earned Rs. 78 lacs from their retail business and the remaining from their digital marketplace. They record Rs. 12-13 lacs as net profit, after giving about 28-30% of their net revenue to the airport services.
Industry Overview
The handicraft sector of India is the backbone of its rural economy. It provides skillful employment to a vast segment of craft persons present in rural and semi-urban areas. This is because of the rich culture and diversity of India: our language, culture and clothes change every 100 kms. Handicrafts also generate substantial foreign exchange for the nation as exports are expected to cross the Rs. 24,000 Cr. mark by the end of next financial year.
Increasing use of technology for connecting artisans’ work with people and a number of government schemes has helped this sector grow by a rate as high as 20%. Also, the penetration of the products produced by these people has increased multifold because of increasing concerns towards the environment, and increasing use of natural raw products.
Previous Equity Split/Investments
They raised Rs. 1.25 Cr. earlier at the valuation of Rs. 6.5 Cr. At this time, they earned Rs. 4-5 lacs as their monthly revenue. Post this, they again raised Rs. 2.5 Cr. in 2020.
Offers made, and the one accepted:
Namita Thapar, the only one to offer, offered to invest Rs. 65 lacs, but for 5% equity of the company. This was countered by asking for the same amount for 2 or 3% equity of the company. While Namita said to bring it till 4% at least, the deal was closed at 3% itself.