Also in this letter:
■ Third Wave Coffee CEO interview
■ Z21 Ventures plans second fund
■ Zomato, Paytm confirm deal talks
Peak XV Partners, Steadview, Think Investments line up to fund Bluestone
Venture capital firms and crossover funds, which invest across private and public companies, are lining up to pick up a stake in IPO-bound omnichannel jewellery retailer Bluestone. We have some important details on the financing round and Bluestone’s financials.
Driving the news: Peak XV Partners, formerly Sequoia Capital India, Steadview Capital and Think Investments are in talks to invest in Bluestone’s Rs 830 crore ($100 million) financing round before it files for an IPO, sources told us. Peak XV is expected to cut a Rs 415 crore ($50 million) cheque for the Accel-backed firm.
State of play: The funding at a Rs 7,500 crore ($900 million) valuation will see a mix of primary and secondary transactions, with early investors part-selling their stake in the 13-year-old firm to new investors. We reported on May 29 that a $100-million round was in the works, which may catapult the firm into the unicorn club of private companies valued at $1 billion or more.
Doubling valuation: The new funding will more than double Bluestone’s valuation from its last fundraise in September 2023. Manipal group chief Ranjan Pai, Zomato founder Deepinder Goyal, and Zerodha’s Nikhil Kamath, among others, invested at a valuation of $450 million.
Turnaround story:
- Bluestone’s revenue jumped to nearly Rs 788 crore in FY23 from Rs 476 crore in FY22, aided by strong growth and expansion in its offline footprint.
- The firm estimates revenues of Rs 1,200 crore in FY24 with Rs 3 crore of Editda.
- What’s significant is that the company’s online revenue is just around Rs 150 crore of this with the rest coming from physical stores.
- Bluestone is projecting revenues to grow to Rs 2,200 crore in FY25.
How states are chipping in with housing support at new semiconductor hubs
State governments have chipped in with infrastructure support, including housing for workers, at the upcoming electronics and semiconductor manufacturing hubs in Assam, Gujarat, and Tamil Nadu.
In detail: The Assam and Gujarat governments have provided land at subsidised rates to build mega-housing projects, hostels, and dormitories for blue-collar and white-collar workers at the upcoming semiconductor chip manufacturing and packaging facilities, people in the know said.
A senior government official said the Gujarat government is working on a housing project for workers of the chip fabrication unit being planned at Dholera, which is likely to comprise 1,500 flats, hostels, and dormitories with a capacity of up to 10,000 beds for shop floor workers.
Tamil Nadu in focus: At the Hosur plant in Tamil Nadu, where Tata Electronics assembles iPhone enclosures, the state government is assisting the housing project in a three-pronged manner, entailing some land at a subsidised rate, an investment in the housing project, as well as payment to build an access road to the plant.
Moreover, the Tamil Nadu government is constructing a state-run facility with a capacity of 18,000 beds in Sriperumbudur exclusively for Taiwanese contract manufacturer Foxconn, which is set to be inaugurated in August.
Third Wave Coffee will add over 50 stores, expand to new cities: CEO
From L: Rajat Luthra (CEO) and Sushant Goel (cofounder) at Third Wave Coffee
Specialty coffee chain Third Wave Coffee is set to expand its footprint amid growing competition and increased venture funding in the space.
Driving the news: Rajat Luthra, the new CEO of Third Wave Coffee, said the chain will add at least 50 new stores this financial year to double down in existing markets as well as enter a couple of new cities. Currently, it has 107 stores. Luthra, former KFC India head, joined the Bengaluru-based coffee chain in April as founder Sushant Goel is transitioning out of the CEO role.
Tell me more: Luthra said the company will also scale its roastery capacity to start retailing its coffee beans across the offline retail network and not just its own retail outlets. “The roastery that we have is just enough to feed our own stores. The new capacity–with equipment in place and land deals signed up–will see construction start. Then, we will go all out selling our beans,” Luthra said.
Busy beans: New-age coffee brands have seen a rush of venture capital funds pumping in money across brands such as Blue Tokai, Subko Coffee, AbCoffee, and others. Canada’s Tim Hortons, and British chain Pret a Manger have also entered India, besides legacy brands like Starbucks and Costa Coffee.
Number game: Third Wave Coffee more than doubled its operating revenue of Rs 243 crore in FY24. In FY23, its revenue grew by over four times to Rs 144 crore, along with a loss of Rs 54 crore. Third Wave Coffee’s FY24 audited financials are yet to be filed with the Registrar of Companies. It last raised $35 million from private equity fund Creaegis in September last year. In total, it has raised $66 million.
Other Top Stories By Our Reporters
Z21 Ventures founders Jyotika Gupta and Raj Shekhar Singh
Early-stage VC Z21 Ventures planning $40 million second fund: Early-stage investment firm Z21 Ventures, which backs startups in India as well as those started by Indian-origin founders in the US, has fully deployed its first $5-million fund and is planning to launch a second fund of $40 million, said one of its founders.
Zomato confirms discussions to acquire Paytm’s movies, ticketing business: Gurgaon-based Zomato confirmed it is in discussions to acquire Paytm’s movies and ticketing business. We reported on June 16 that Zomato is looking to acquire Paytm’s movie booking and events unit — in a deal that may value Paytm’s vertical at around Rs 1,600-1,750 crore.
Infosys announces sops to employees willing to transfer to Hubballi campus: Software major Infosys on Monday announced a transfer policy with an attractive incentive package for its employees willing to transfer to its Hubballi development centre as the company seeks to strengthen its operations in the tier-II city in the Mumbai-Karnataka region.
GreyLabs AI raises $1.5 million: Speech analytics platform for financial institutions GreyLabs AI has raised $1.5 million in a funding round led by early-stage venture capital firm Matrix Partners India. The round also saw participation from Ofbusiness founder Vasant Sridhar, MoEngage founder Narasimha Reddy, Uni Cards founder Nitin Gupta, and Scapia founder Anil Goteti among others.
Global Picks We Are Reading
■ India pulls in tech giants for its AI ambitions (FT)
■ Elon Musk and the SEC are on a collision course again (WSJ)
■ Amazon-powered AI cameras used to detect emotions of unwitting UK train passengers (Wired)
