SoftBank Vision Fund has invested around $300 million in FirstCry, an omnichannel retailer dedicated to baby and mother care products as part payment for their fresh stake in the company.
The Masayoshi Son led conglomerate has accepted the private placement letter dated 12.1.19 for the $400 million investment in FirstCry and making it the latest entrant in India’s unicorn club.
According to regulatory filings by FirstCry’s holding entity BrainBees Solutions, it has approved allotment of 73.1 million Series E equity shares at a price of Rs 386 (including a premium of Rs 381) per share to SVF Frog, a Cayman Islands-registered entity of Softbank. The company has received $300 million (Rs 2,120.5 crore) in the first tranche of the investment.
The remaining $100 million (Rs 703.71 crore) would be released on the second anniversary of the deal in January 2021.
While the valuation of the company in this round couldn’t be ascertained from the filings, Enrackr’s back of the envelope calculation shows FirstCry has been valued at least at $1.2 billion in this transaction. SoftBank Vision Fund will now hold around 40% equity in the Pune-based firm.
A decade-old venture, FirstCry has been an undisputed leader in the omnichannel baby and mother care products segment. It consolidated the segment after acquiring Mahindra Retail which ran the BabyOye brand in an all-stock deal worth $50 million (Rs 362 crore).
The proceeds from this investment will be used to scale the company’s offline network and take on horizontal majors – Amazon and Flipkart.
It’s worth noting that FirstCry also used to own e-commerce focused logistics company XpressBees. However, it spun off the logistics division as a separate entity and later raised funds from Alibaba.
This latest investment by SoftBank Vision Fund in FirstCry follows its investment in omnichannel eyewear retailer Lenskart in December last year.
Interestingly, Alibaba had backed one of FirstCry’s parallel – BabyTree in China – but it never put direct capital in the Supam Maheshwari-led venture. It’s not known whether XpressBees owns any equity in FirstCry.
With this $300 million round, FirstCry has raised about $425 million in total risk capital. Its previous backers include Chiratae, SAIF Partners, Adveq and Vertex Ventures.
SoftBank’s bets in India in the past one year show it has preferred mature businesses over startups. Out of its last four bets, three investments were in decade-old and category leaders – Delhivery, Lenskart and FirstCry. It has also put money in digital payments major Paytm and private labels focused Grofers as follow on rounds in its portfolio companies.
Hat tip: paper.vc