Founded in 2012, the startup had converted into a public company in 2022 in line with its proposed IPO. The company was looking to raise $250-300 million through an IPO, its late founder and then chief executive officer Ambareesh Murty had told ET in 2022.
“We have postponed our IPO plans for the time being. There are other important areas to focus on in the business. From a cost standpoint, we are strong. Therefore, we are focusing on growth now. We aim to go slow but get solid growth, which is also profitable. If we can continue this growth for 8-10 months, we will be IPO-ready,” Shah said.
According to the latest available data, Mumbai-based Pepperfry saw marginal revenue growth at Rs 272.3 crore in FY23 compared to Rs 247 crore in FY22. Shah said the subdued performance was due to a slowdown in discretionary spending and that the company is shifting gears to achieve steady growth. Pepperfry’s net loss in FY23 stood at Rs 187.6 crore compared to Rs 194 crore in FY22. It is yet to file FY24 financials.
Pepperfry’s revenue comes largely from the commission it makes on the sale of products.
The company is aiming to grow revenue sequentially every month this fiscal, ending the year with a 10-15% increase, Shah said. He said this will be aided by surging property sales across India and higher consumer spending, driving orders for furniture and home decor.
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Shah said that with a continued focus on profitability, the furniture and home marketplace has reduced its cash burn by a third compared to 2023. “All our actions on costs are done and we have a very sorted financial architecture now. With 10-15% growth we will hit profitability. Further, we have been optimising our studios to drive business growth. Compared to last year our studios are driving 15% more business growth today.”According to him, Pepperfry is now focusing aggressively on home decor as a category. To deepen its portfolio, the company has onboarded multiple direct-to-consumer (D2C) brands.
Currently, Pepperfry drives 60% of its sales via home decor. Further, the retailer aims to launch more private-label brands and has also started display services for retail brands in its studios as an additional revenue stream.
Norwest Venture Partners, Goldman Sachs and Pidilite Ventures are among the key investors at Pepperfry. It last raised $23 million from its existing shareholders in September last year and elevated cofounder Shah to the CEO role following Murty’s sudden death due to a cardiac arrest.
The furniture retailer competes with ecommerce firms like Amazon India and Flipkart besides Reliance-owned Urban Ladder and others.