Furlenco raises $140 million to enter new cities, widen portfolio

Currently in 13 cities, firm will serve 15 cities by year-end, including Tier-2 market; also exploring options to enter Dubai and Singapore next year

Online furniture rental startup Furlenco has raised $140 million in a mix of debt and equity as part of its latest funding round led by Zinnia Global Fund. Along with Zinnia, CE-Ventures and Lightbox Ventures also participated in this round. While it raised $120 million in debt, the company raked in $20 million in equity. With this round Furlenco has raised over $200 million so far, most of it in debt funding.

The Bengaluru-headquartered startup would be using the funds to enter newer geographies, expand workforce, and widen its portfolio.

“Until now Furlenco was utilitarian. We are now going to be adding new products in our categories at the rate of one product per day so people would start visiting Furlenco for their home decor needs too,” said Ajith Mohan Karimpana, Founder & CEO, Furlenco. “We would like to become the Netflix of the furniture world,” he added.

Currently present in 13 cities, Furlenco will be serving in 15 cities by the end of the year including Tier 2 geographies. The company is also eyeing international expansion and is exploring options to enter Dubai and Singapore by next year. With a current revenue of Rs 100 crore, the business is now looking at scaling its annual revenue to Rs 2,200 crore in the next 5 years.

Since the company follows a subscription-based revenue model, it generated cash even during lockdowns from existing customers. “This is also one of the reasons why we are attractive to large amounts of debt funding because we have a constant revenue stream,” said Karimpana. It has furnished over 150,000 homes so far. 

Furlenco offers furniture packages across categories, such as living room, beds,  dining tables, study solutions, and workstations. As part of its value-added  services, its customers have the ability to swap their furniture when they want to try a new look or when their needs change. The startup has in-house designed furniture which are refurbished at its refurbishment centres every time they are shipped to a customer. The company already has a refurbishment centre in Bengaluru and Mumbai and with a third one coming up in Delhi soon. “Ultimately, we will have a refurbishment centre in every city that we are present in,” said Karimpana, who founded Rent Ur Duniya in 2011 which was later rebranded as Furlenco in 2013.

According to a Redseer report, the rental furniture and appliance industry currently  stands at around Rs 33,500 crore, and is expected to grow at a CAGR of 11 per cent between  2021-25. Some of the major players that dominate the market are Accel-backed RentoMojo, Furlenco, Rentickle and CityFurnish. According to the report, these players can serve a total relevant rented households of around 14 million with a monthly average order value of Rs 1,900 and the average rental duration being 13 months.