10Club co-founder Bhavna Suresh on scaling digitally native businesses
What is the business model of 10Club that acquires and grows e-commerce-first businesses? How do brands benefit from its expertise? Co-founder Bhavna Suresh answers these and more in this interview
Krishna Veera Vanamali New Delhi
 "M&A, mergers & acquisitions, merger, partnerships, Joint venture, JV")
Q1. Can you briefly explain your business model? It is new in the Indian market. And we have seen several similar startups spawn over the last year. What do you do?
Ans:
* Acquire and integrate digitally native businesses
* Catering to marketplace-first businesses only
* Focused on Home, Sports and Baby category
Q2. You raised $40 million in seed funding, and a fellow startup turned unicorn in just six months. So what explains this mad rush of money in the roll-up space? Is it only because the business is acquisitive in nature? What is the market potential that you see?
Ans:
* It is a capital intensive business
* It is also a deep operation play
* Awaiting Round-C fundraising
* Money value is overshadowing crux of business
* Evolving into a business operator, instead of an investor
Q3. In terms of revenue, what is the ideal size you're targeting for your acquisitions? And is there an upper limit when it comes to 10Club?
Ans:
Slide 1
Important factors for acquisition
* Portfolio mix and themes
* Entrepreneurs and their capabilities
Slide 2
* Annualised revenue range: Rs 10 to 70 crores
* Need for capital infusion: Above Rs 70 crores
Q4. What are some of the metrics that you look for in your targets?
Ans:
* Avoid competing brands in portfolio
* Focus on Home, Sports and Baby categories
* Ensure complementary services in portfolio
* Avoid expansion of the portfolio
* Approach businesses with 15% to 20% EBIT margin
Q5. Post the deal, how do these brands benefit from 10Club's expertise, what kind of services do you provide to scale them?
Ans:
* Offer entire portfolio of services
* Develop full-stack solutions
* Offer supply chain superiority
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First Published: Nov 19 2021 | 8:30 AM IST
