Sleep and home solutions startup Wakefit.co has raised Rs 185 crore in its Series B round of funding led by Verlinvest and Sequoia Capital India.
The fresh proceeds will be utilised to accelerate the company’s strategic expansion to newer markets and expand its product portfolio in home furnishings, said the company in a press statement.
As part of the funding round, the company has also rolled out an Employee Stock Ownership Plan or ESOP buyback worth Rs 15 crore for early employees. Moreover, the startup will also add another 40-50 employees to its ESOP pool.
Wakefit had raised Rs 65 crore in its first institutional round from Sequoia Capital in December 2018. Following the investment, Sequoia had picked up 31.9% stake in the Bengaluru-based startup.
According to Chaitanya Ramalingegowda, director and co-founder of Wakefit, the founders hold more than 50% stake in the company after the fresh round and around 6-7% will be held by employees under the ESOP scheme. Early backer Sequoia will continue to hold 31.9% equity stake in the company while the remaining being held by Verlinvest.
Launched in 2015 as an online mattress retailer selling directly to customers, Wakefit has expanded its portfolio to sleep accessories like back pillows, neck support pillows, and comforters.
After setting up factories in Pune, Delhi, Jodhpur, Hyderabad and Bengaluru, the company has a plan to double down in Tier II and Tier III markets in India besides increasing its employee strength from 600 to 3,000 by March 2021.
Wakefit claims to have been profitable since inception with Rs 80 crore revenue in FY19 and Rs 199 crore in FY20. The company further expects to clock Rs 400-500 crore in revenue in the ongoing fiscal year and Rs 1,000 crore by FY23.