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It was just a few years back when buying furniture was a tiring task. You have to either rush from one showroom to the other in search of a particular design or quality of furniture you are looking for, or you needed to get it custom-made at higher costs and still be dependent on the carpenter or the shop. Even after running pillar to post and waiting for your product, you still might recollect being disappointed with the quality of the furniture, the design, or the costs, which were way too high.
However, the process is much simpler now. You can now simply choose any piece of furniture you like online, and get it delivered, and even get it assembled and installed, at your leisure without any hassles. Owing to these benefits, the number of people opting for furniture online has increased.
The online furniture market was valued at $25.7 billion in FY20 and boasts of growing at a CAGR of over 35%. Pepperfry is one such company that is behind this growing popularity of online furniture shopping among Indians.
Established in 2011, Pepperfry brings to you stylish and quality furniture with attractive EMI options. From electrical appliances to wall arts, Pepperfry grants everything you need to make your apartment a home and your home your dream one. Let's have an insight into this startup that has successfully established itself as a signature of beautiful homes!
Read more about Pepperfry Company Profile, Founders, Business Model, Funding, Competitors, Logo, Growth, and more here!
Pepperfry - Company Highlights
- Startup Name-Pepperfry
- Founders-Ambareesh Murty & Ashish Shah
- Funding-$280.24 Million (November 2021)
- Valuation-$700 Mn (CY2020)
- Revenue-$34.98 million (Rs 260.61 crore in FY20)
- Parent Organization-TrendSutra Platform Services Pvt Ltd
Pepperfry - About and How Pepperfry Works
The largest online furniture store in India, Pepperfry was founded in the year 2011 by Ambareesh Murthy and Ashish Shah. However, it was primarily established as a horizontal online marketplace that focused on fashion and lifestyle. Yes, it was the time when Flipkart was just another e-commerce startup, and Amazon didn't hit the Indian markets. Profits initially came in well, but they stopped eventually, which led the company to abandon the earlier business and stick to a niche model involving the online selling of furniture and home furnishing products, which ultimately proved profitable.
The brand Pepperfry now specializes and deals with home decor segments like furnishing, lighting, kitchen appliances, housekeeping, bathing equipment, dining, and so on.
This e-commerce company has a wide range of products that makes an amazing experience for the users. Their products and delivery mechanism have made them a leading brand in their category. The company has registered 7 million+ visits on its website every month, boasted of more than 4.5 million registered users and subscribers, and claims to have over 10,000 sellers on board.
Initially, Pepperfry was started to provide products across multiple lifestyle categories but then after a year, in 2013, Pepperfry pivoted to find a niche in the category of selling only furnishings, home decor, and related products online. Headquartered in Mumbai, Pepperfry has also opened over 60 Pepperfry studios in 18+ Indian cities. These studios display a wide range of furniture, so that the customers can get a look and feel of the furniture before placing an order.
In September 2018, Pepperfry launched a furniture rental service in Mumbai, Bengaluru, Delhi, Gurgaon, Hyderabad, Pune, Chennai, Noida, and Ahmedabad, despite Furlenco and Instamojo already having a lion’s share of the market. This service targets the urban population between the ages of 25 to 35 and is offering 1200+ products for rent for a period of 6, 9, or 12 months. In 2018, it also tied up with online classifieds platform Quikr for a furniture exchange program.
Pepperfry is particularly proud of its omni-channel capabilities, allowing the consumer to order anytime, anywhere, from any channel or device. This is possible through mobile and website presence, which allows consumers to switch easily between these media for any part of their purchase journey.
Trendsutra Platform Services Private Limited is the parent company of Pepperfry. It now provides e-commerce products and offers discounted lifestyle products for retail sale through the internet, including clothing, furniture, jewelry, personal care items, and home decor products.
Pepperfry - Industry
The online furniture market in India is growing at a CAGR of a strong 39%. In the calendar year 2020, the online furniture market grew to $400 mn from $275 mn in CY2019. Over the next five years, this market is expected to grow by 3X with a 1.8X jump in the annual spending per shopper.
Pepperfry - Founders/Owners and team
Ambareesh Murty and Ashish Shah are the founders of Pepperfry.
Pepperfry CEO, Ambareesh Murty is an MBA graduate from IIM, Calcutta. He had worked with Cadbury, ICICI Prudential, and Britannia. Ambareesh was the Country Manager of eBay India, Philippines, and Malaysia, while serving as the Vice Chairman of the Internet and Mobile Association of India (IAMAI).
Ashish Shah, COO, Pepperfry, has an Advanced Diploma in Materials Management from the Institute of Management Technology, Ghaziabad. He has a degree in Chemical Engineering from the University of Pune. Ashish began his career by joining Tradox Pigments & Chemicals as their Branch Sales Manager in 1998, and later worked in companies like ChemB.com India, C1 India Pvt Ltd, Baazee.com, and lastly eBay, where he looked after the sales and operations for eBay India before starting Pepperfry.
The other core members of the team are Sanjay Netrabile, who is the Chief Technology Officer (CTO) of Pepperfry, and Kashyap Vadapalli, who has been serving as the Chief Marketing Officer (CMO) and Business Head.
How was Pepperfry Started?
Ambareesh Murty, Ashish Shah, and Niren Shah, all of whom were former eBay India personnel, met over lunch once in 2011 at Niren Shah’s Nariman Point office in Mumbai. Murty was then the country manager for eBay India and Ashish Shah led the motors and social shopping department of the office; Niren Shah had already taken an exit from the company in 2007 and joined the investment firm Norwest Venture Partners, as the managing director.
During their lunch, that day Murty and Ashish Shah decided to present their plans of launching a lifestyle e-commerce venture that would revolve around paper napkins to Niren Shah, who loved the idea instantly. This lunch meeting came to be the genesis of Pepperfry, the online furniture marketplace, and the home decor platform.
The founder duo - Murty and Shah, decided to start up in early 2011. It was then that they tried maintaining their Linkedin profiles accordingly, the first step of which was making their profiles read "starting up". Soon after they became a team of six and the company which was relying on the personal equity of the founders were now officially committed a sum of $5 million from some VCs. Though the deal was in the term sheet, it wasn't materialized in this case.
Here was a time when the brand lacked a brand name and funding, and on the other hand, the founders have already invested all of their life's savings and were peculiarly stranded. However, Murty and Shah didn't lose hope, they instead persuaded their whole time of 25 people to go to Goa on a holiday. This was a daunting step indeed along with being an interesting one, where the founders didn't want to miss out on the last opportunity to enjoy.
The silver lining followed eventually in the form of the Series A funding round that helped pepperfry raise around $5 million. This instilled waves of passion and motivation in the team, and the company never had to look back since then.
Pepperfry - Meaning / Tagline / Logo
During the initial phase, both the co-founders were clear with their startup idea
but were confused with the selection of the name. While thinking of many names
that popped up in their mind they narrowed down to "Pepper" to give it an Indian touch and then added "fry" to the name to further make it interesting.
Although the name seemed to be of a restaurant or food startup, they started to take advice from the built businesses on the name and recorded their interviews. This way they figured out a way to explain the name of the brand and their work through videos on ‘Pepperfry TV’.
"When we were hunting for a good name, we asked ourselves what’s truly Indian? We came up with spices. Hence pepper. It’s truly Indian! We added fry to bring fun element. But it was sounding like a foodie brand. So we went and talked to folks who have built successful foodie business. We interviewed owner of Britannia Restaurant (famous Parsi joint), Bade Miyan etc and we asked them how they built business, what pepperfry means to them. We made videos of these and Pepperfry TV is a way for us to explain who we are" Pepperfry owner Ambareesh Murty said in an interview with nextbigwhat.com
Through the name, the founders want to reflect on the fact that the company’s business attitude was of Fun, being Honest, and staying Indian. Pepperfry's tagline ‘Happy Furniture to You’ is a representation of their ultimate goal to make their customers happy through their products and service.
Pepperfry - Business Model and Revenue Model
Pepperfry works on a Managed Marketplace Business Model wherein the small and medium business artisans and merchants sell their merchandise through the company.
Pepperfry's category team meets the sellers, and after proper checking, they procure selected products from the sellers. The products are then taken to studios for photoshoots. The photos of products are then cataloged and placed on the website. Once a product is sold, it is brought from the sellers to Pepperfry's warehouse, where the quality of the product is checked, and the product is packed and dispatched to the customer.
Currently, Pepperfry is working with 10,000+ merchant partners who sell their products all over India.
In the year 2014, the company had some variations in its business model. Along with its website, and application, Pepperfry opened its retail stores under the name Pepperfry Studios. The company has to date delivered its products in more than 500 cities and is still expanding its presence in the market
Pepperfry - Funding and Investors
Pepperfry has raised a total of $280.24 Million to date (November 2021).
Pepperfry last raised $40 Million from a debt funding round from 47 investors including Norwest Venture, General Electric Pension Trust, and other family businesses and trusts on November 23, 2021. The previous funding for Pepperfry came in on 12th February 2021, when the company raised close to $5 Million from InnoVen Capital.
Pepperfry is looking to raise up to $300 mn via the sale of new stock and a secondary offering of shares before its upcoming IPO.
In 2018, Pepperfry received funding of Rs 250 crore from State Street Global Advisors, the asset management business of State Street Corporation, one of the world’s largest investment management companies. This was one of the highest amounts of capital raised by an e-commerce furniture and home products company in India. The funds raised were used to scale up Pepperfry’s logistics network from 500 to more than 1,000 cities and open more experience centers, called Pepperfry Studios, in smaller towns and cities.
In 2016, Pepperfry raised Rs. 210 crores in a Series E funding round from existing investors - Goldman Sachs, Bertelsmann India Investments, Norwest Venture Partners, and Zodius Technology Fund.
In 2015, Pepperfry raised $100 million (around Rs.600 crore) in a Series D funding round led by Goldman Sachs Group Inc. and Zodius Technology Fund. The existing investors Bertelsmann India Investments and Norwest Venture Partners also participated in the round. The funds were used to open more distribution centers in an attempt to expand the company’s reach in small cities and towns and strengthen its logistics network, which comprises a fleet of more than 400 vehicles at present. Pepperfry also raised $15 million (around Rs.90 crore) from Bertelsmann India Investments and Norwest Venture Partners in its second round of funding.
Pepperfry - IPO
Pepperfry is looking to list on bourses and for this, it has already started rearranging its business structure. Pepperfry, which was earlier registered in Cayman islands in order to help it list in the US, has now been redominciled in Mumbai. Furthermore, the company is also onboarding independent directors because for the unlisted public companies it is mandatory to reserve at least 33% of its directorships for independent directors, in case the chairman of the company is an independent director. Pepperfry will likely file its draft red herring prospectus with SEBI this year, 2022. Pepperfry has already converted into a public entity with the Pepperfry board passing its resolution in May 2022. This changed the name of Pepperfry to Pepperfry Limited.
Pepperfry - Partnership and Tie-ups
In July 2018, Pepperfry tied up with an online marketplace for pre-owned furniture Zefo to provide customers with an opportunity to sell their old furniture to Zefo in exchange for Pepperfry gift cards through the ‘Exchange Your Furniture’ service. These gift cards are redeemable against purchases made on Pepperfry.
Pepperfry also launched the ‘Privilege programme’ by partnering with about 1,400 architects and interior designers to widen its customer reach. The programme is expected to host 10,000 partners by the end of 2018.
Moreover, Pepperfry also partnered with Rajasthan Royals for IPL 2015 to promote its brand name and also to increase user engagement and sales.
Pepperfry - Growth and Revenue
Today, Pepperfry is one of the budding online furniture retailers but the total market share of the company was estimated at a mere 3.5% of the total market size of $20 bn by Redseer. By the end of 2026, the overall furniture market of India is estimated to grow to $37.72 bn and with around 3.5% market size, pepperfry is likely to grow to $1.32 bn by that time.
Pepperfry claims to have 21+ distribution centers and a fleet of over 400 vehicles. Pepperfry now has 1 million+ home products, ranging from coffee tables and beds to bedsheets and lamps, and delivers to more than 500 cities in India. The company owns 14+ warehouses across the country. They say that their Padgha warehouse, located north of Mumbai, is India’s largest.
Some more growth highlights of Pepperfry are:
It owns 73+ showrooms
- Pepperfry boasts of having 140+ studios through its franchise programme
- Pepperfry is backed by India's leading adhesive company Pidlite
- Pepperfry has already turned into a public company on May 20, 2022, and is all set to go public. The new name of Pepperfry is Pepperfry Limited, and its conversion to a public entity has been passed by the board of directors of the company.
pepperfry Revenue and Financials
pepperfry reported operating revenue of Rs 246.03 cr in FY20, which is around 27% higher than Rs 193.26 cr, which the company posted in FY19. Furthermore, the startup managed to lower its losses to Rs 117.4 cr in FY20, which is also a significant decrease of around 33.3% from Rs 183.49 cr in FY19. The company posted Rs 203.4 cr in operating revenues, which shrank from the previous fiscal by nearly 14%. However, the company also managed to bring down its losses, which were recorded at Rs 47.2 cr in FY21.
Pepperfry - Awards
- Pepperfry was conferred upon the “2012 Red Herring Asia Top 100” award, which honored the most promising private tech ventures from Asia.
- Pepperfry also won the “Pure-Play e-Retailer of the Year” at the Indian e-Retail Congress 2014, which recognized outstanding performance and innovation in retail.
- Pepperfry won the Gold award at the Neons for Best Creative under the category of Retail Advertising for its Outdoor campaign – ‘Happy Furniture to You’.
Pepperfry - Startup Challenges
Pepperfry already faced enough challenges involving funds even before it came up with a name. The next big challenge was that of the logistics. Furniture is not something like pizza that they just have to pick up from the nearest place and deliver to the customer. A small scratch can spoil the whole beauty of the furniture. Initially, the company hired third-party service providers for logistics. However, the services provided by these third-party vendors were pathetic.
As revealed by the founders, sometimes, the third-party delivery agents even abandoned the ordered items in the lobbies of buildings if they did not fit in the elevator. All these led Pepperfry to begin its own in-house logistic services to get the products delivered timely and intact.
Ashish says that now Pepperfry’s damage rate between the production and delivery to the customer is just 2%, while the global average is 6%.
Apart from all these challenges building a niche market of furniture and furnishings and shifting the entire unorganized market online is itself a feat!
Pepperfry - Competitors
Pepperfry's competitors in the furniture segment are:
- Urban Ladder
- Livspace to name a few.
Furthermore, the furniture renting platforms that pose as fierce competitors to Pepperfry are:
Another looming concern is the entry of the world’s largest furniture retailer, Ikea. The Swedish retailer began its operation in India in 2018. Ikea also has a gripping backstory of rags-to-riches involving its founder Ingvar Kamprad.
Pepperfry - Future Plans
The company has already achieved remarkable success and has added value to
the furniture and home décor industry. The company has recently added the
augmented reality (AR) features by which the customers can virtually place the products in their homes and then make decisions. The company plans to utilize
such technological advancements to continue in the future as well. Pepperfry has
been able to achieve the trust of the customers which led the company to stand
on top in India.
Pepperfry is currently curating products from the leading manufacturers of furniture and home décor items in 2021, and the company is eyeing to go after the local and regional furniture manufacturers as well, to add more variety to its collection. The company is also planning to partner with many local and regional players ahead.
The online furniture retailing startup is eyeing an IPO in 2022, and will likely file its DHRP with SEBI soon, as of July 30, 2022. "We are turning profitable and this would be the right thing to do next", said the founders.
Who is the Founder/owner of Pepperfry?
Pepperfry co-founders are Ambareesh Murty and Ashish Shah. The parent Company of Pepperfry is Trendsutra Platform Services Private Limited.
What is the Tagline of Pepperfry?
Pepperfry's tagline "Happy Furniture to You" is a representation of their ultimate goal to make their customers happy through their products and service
Is Pepperfry Indian Company?
Yes. Pepperfry is headquartered in Mumbai, India.
How long does Pepperfry take to deliver?
In Mumbai, the delivery is done within 24 hours. Pepperfry has brought down the delivery time from 25 days to almost 11 days now. The delivery vehicles are highly customized, and are padded from inside to prevent scratching.
Does Pepperfry assemble furniture?
Yes, Pepperfry happily assembles the furniture at the property of the customers without any charges. Besides, they also offer free servicing for almost a year on selected products.
Is it safe to buy from Pepperfry?
Pepperfry is a reliable site to order furniture items online. This e-commerce company has a wide range of products that makes an amazing experience for the users. The products and delivery mechanism have made them a leading brand in their space.