Mensa Brands becomes India’s fastest startup to turn unicorn, raises $135 mn

Other existing investors, including Accel Partners, Norwest Venture Partners and Tiger Global Management, along with new investor Prosus Ventures, formerly Naspers Ventures, also participated in the round, making Mensa the fastest startup to reach unicorn status in just seven months of inception.

A unicorn is a privately held startup with a valuation of $1 billion.

Previously, jobs platform Apna; electric mobility solution provider, Ola Electric; business-to-business marketplace Udaan; InMobi’s lock screen solution, Glance; and Paytm Mall were considered to be among India’s fastest unicorns, achieving a valuation of more than $1 billion in about two years of starting operations.

Mensa Brands now plans to deploy the fresh capital to accelerate growth, and ramp up its acquisitions in the market, while scaling its team across operations, marketing and technology functions.

The company has close to 60 employees at present, and looks to scale it to 150-200 members over the next 12-18 months.

Founded this year, Mensa Brands follows a ‘house of brands’ or brand aggregation strategy where it acquires and partners with digital first brands and looks to accelerate their growth through providing on-ground expertise and tech-led interventions around marketing, and operations.

Mensa currently focuses on fashion, beauty and cosmetics as well as the home furnishing category.

“One of the key reasons to raise another round of investment this year is to invest into more brands. There are a lot more inbound deals coming our way now and we look to tap into those opportunities. Close to 80% of this fundraise will go in bringing these brands to Mensa’s fold. The second is to grow and scale our brands both in domestic and international markets, as well as to scale our team,” said Ananth Narayanan, founder and chief executive officer (CEO) of Mensa Brands in an interaction with Mint.

Narayanan added that Mensa has acquired 12 brands till date and it looks to scale its acquisitions to 40 brands over the next 12-18 months. The company is in the process to close another eight deals in the near term, he added.

The average ticket size to acquire a brand remains in the $4 million to $5 million range, Narayanan explained.

Of the total 12 brands, close to four of them have been selling to international markets, the company said.

“Close to four of our total 12 brands are selling in international markets including the UK, US and Middle East. We are forming partnerships with international e-commerce majors such as Amazon, Walmart and Target to retail these brands. Today 15% of our revenues come from international geographies. We can see this number grow to almost 30% in 12-18 months. However, our brands will be primarily focused on the India opportunity,” added Narayanan, who was formerly the chief executive of Myntra and Medlife, before starting Mensa in May 2021.

Within six months of starting business, Mensa has already raised a total of more than $300 million in equity and debt. It has also secured debt financing from Alteria Capital, InnoVen Capital, Piramal Capital, Stride Ventures, and TradeCred, among others.

“Mensa demonstrates a tangible uplift through a combination of product and pricing optimization, technology-led process improvement, distribution and marketing augmentation and fine-tuning the supply chain. These levers meaningfully accelerate the growth and margin trajectory of the brands and make them well-poised to become category leaders,” said Navroz Udwadia, co-founder and partner of Alpha Wave Ventures.

In May 2021, Mensa had raised around $50 million as a part of its Series A round led by Accel Partners, Falcon Edge Capital and Norwest Venture Partners.

“We are excited to support MensaBrands in their journey to build digital-first global brands from India. Their team brings superior execution focus and technology chops to help emerging brands scale digitally,” said Ashutosh Sharma, head of investments, India, Prosus Ventures.

The competition in the ‘house of brands’ e-commerce space is heating up, with Thrasio-style e-commerce ventures such as 10Club and GlobalBees raising $40 million and $150 million respectively in the largest early-stage rounds amongst Indian startups.

Even beauty marketplace, Nykaa, which recently went public, is eyeing a ‘house of brands’ strategy across new categories of home furnishing.