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Browsing the pictures of beautiful homes on Houzz.com and Pinterest can be great fun but decorating your dream home can turn into a nightmare. The right design and personnel are often elusive; the installations impossible to find.
Not anymore, claims Bengaluru-based start-up Livspace, self-fashioning itself as a home design service provider and curated market for homeowners and professional decorators.
Its founders Anuj Srivastava, Ramakant Sharma and Shagufta Anurag have loads of experience in e-commerce and the lifestyle sector. Srivastava, a founding advisor and investor at Jungle Ventures, earlier worked at Google Mountain View headquarters, where he led the worldwide product marketing team for e-commerce. Sharma was a core team member and vice-president (engineering) at fashion and lifestyle e-commerce firm Myntra.com.
Anurag, who founded Space Matrix in 2001 in Singapore, is now termed the chief design evangelist of Livspace.
Frustration sprouts ideas
"Our combined frustrations at trying to decorate our homes in India, the US and Singapore inspired Livspace," said Srivastava, the chief executive. "Instead of being fun, it turned out to be a nightmare. It took me nine months of misery to get my apartment in San Francisco designed by a professional I found on Houzz." Inspired somewhat by Houzz, and e-tailer One King's Lane in the US, the trio decided to launch Livspace. Incorporated in 2012, it began operations in December 2014. It says it enables homeowners to choose a look for homes, personalise colour, material, and furniture to their liking; place an order and get the delivered products installed. Customers also have the option of seeking help from a Livspace designer without any charge.
Srivastava claimed Livspace's positioning was very different from others in the market. "We have done many sector-firsts, such as offering photo-realistic looks, ready-to-live homes in eight weeks, and find your apartment options, online." The home design and decor market is poised to grow at least $25 billion by 2017; at present, it is $13 billion. The strengthening retail market has spread consciousness about how homes can look good. "Products needed to personalise one's home are also easily available," said Sharma.
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The scale
Livspace added end-to-end home design and decoration experience online with the largest marketplace community of home designers after acquiring design community marketplace DezignUp this March and Mumbai-based Dwll.in, a curated online network of interior designers, in May.
"We are open to acquiring great talented teams, if in line with our growth, and who have shown momentum in home design space but let's say that's not the outcome. It is only part of the strategy," Srivastava says.
It uses a technology developed in-house, an open source stack. Powered by a proprietary algorithm and data science, Livspace generates looks automatically, at the click of a button.
According to Srivastava, Livspace currently sees at least 100,000 visits on its website each month, with a 50 per cent month-on-month growth rate. Though its major base remains Bengaluru, it is planning to grow to all major metros in India in the near future, he adds.
"We now have a community of over 400,000 homeowners in only five months and growing at 50-100 per cent month-over-month. The engagement rate with our content is 400 more than comparables in India.
We have also seen over 1,000 per cent growth in web traffic in the past few months. Livspace already has hundreds of interior design looks and over 25,000 SKUs, being personalised by homeowners on an everyday basis," he says.
The financials
Livspace had in December 2014 raised $4.6 million in a Series-A round of funding led by Helion Venture Partners and Bessemer Venture Partners, with participation from Singapore-based Jungle Ventures. The company has utilised the funds to develop products and technology, generate demand and bolster its management team to focus on the $25-billion home design and decor market in India and Southeast Asia.
Stating that Livspace will be raising an appropriate amount of funding to support its growth strategy at the appropriate time, Srivastava says the company is currently projecting annual revenue in excess of $10 million in the near-term, and expects to touch $100 million in 2016.
"We are already profitable at the contribution margin level. We are going very fast and investing in the business and hence, expect to be operationally profitable by the second half of 2017," he says. Adding that expanding to top metros and working closely with channel partners, including developers, Dwll.in and DezignUp, and online real estate portals, would drive this.
According to Rahul Chowdhri, partner at Helion Venture Partners, since Livspace is pioneering an approach, the early-to-mid-stage venture fund definitely sees scale in this venture.
"It is a global model and in the coming years, we would like to see Livspace as one of the most disruptive internet companies to emerge out of India and go global. Also, looking at the growth metrics, the multi-million dollar run rate, the recent acquisitions of DezignUp and Dwll.in, to aid further growth, and a goal to be the largest curated community marketplace of home designers, the Livspace curve looks right on track," he oozes confidence.
EXPERT TAKE: Rohit Ramasubramanian
Livspace's idea of selling complete looks for homes is disruptive, as opposed to only selling furnishings only. It can drive new consumer behaviour.
Home design in India is a huge market but has remained segmented, where the consumer experience has been of largely unreliable sellers and time-consuming issues. The problem demanded an innovative approach. Hence, the concept of an end-to-end service with a focus on personalised design, aided by technology, which slashes turn-around time to eight weeks and offers free design consultation throughout, looks promising. It is always interesting when a start-up innovates technology to solve problems traditionally not considered within technology's domain.
Houzz, with a multi-billion dollar empire in the US, inspired a very interesting phenomenon of photos and ideabooks in the home design space, and combining a search functionality for design professionals.
The Livspace concept is inspired by that model but is unique and takes the innovation to the next level, by being a full-stack design service which can be personalised but also facilitate design inspiration.
Livspace has key opportunities - to remove the pain of the customer, associated with getting one's home designed in India, and visually communicate with the customer.
Rohit Ramasubramanian is analyst and expert on the online home design market
