India: SoftBank-backed FirstCry in talks with ChrysCapital, others for $100m funding

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SoftBank-backed Indian baby products retailer FirstCry is in advanced talks with homegrown private equity firm ChrysCapital and three other investors to raise $100 million in a new funding round.

According to industry sources privy to the ongoing talks, the Pune-based company could either raise the entire amount from one investor or rope in more than one investor to facilitate its expansion plans.

“The final call on fundraising depends on the company. It is currently meeting the investors to see the fitment,” said one source. “If talks fructify, it could take about three months for the deal to close.”

Even as names of the other investors could not be ascertained, another source said all of them are large enough to invest the entire $100 million on their own. “ChrysCapital may go ahead with the $100 million funding alone if needed,” the person added.

When contacted, ChrysCapital partner Sanjiv Kaul declined to comment on the development, while an email sent to FirstCry did not elicit any response.

For ChrysCapital, the negotiations with FirstCry surface at a time when the investor is looking to ramp up its presence in the new economy sector, in which it had a limited presence so far.

“In the last three years, we’ve spent a lot of time on the new economy. It’s just too important for us to ignore. We just haven’t ended up deploying a lot of capital,” ChrysCapital co-founder and managing partner Kunal Shroff had told DealStreetAsia in a fireside chat at the Asia PE-VC Summit in November last year.

While the PE major is scouting for deals in the new economy sector, it is only looking to invest in startups at a much later stage than a typical venture capitalist.

ChrysCapital, established in 1999, has seen a spate of investments and exits over the past few years. Its portfolio companies in the new economy sectors are Dream Sports, the parent company of India’s leading online fantasy sports company Dream11, and co-working operator Awfis Space Solutions.

The PE behemoth had participated in Dream Sports’s $225-million funding round in September last year. Tiger Global Management, TPG Tech Adjacencies (TTAD), and Footpath Ventures had also contributed to that round. Prior to that, in August 2019, ChrysCapital led a $30-million round in Awfis.

Founded in 2010 by Supam Maheshwari and Amitava Saha, FirstCry is expected to use the funding to ramp up its online and offline presence. The company claims to offer over 2 lakh baby and kids products ranging from clothing to other essentials across 6,000 brands. It has expanded its footprint to over 400 stores across India, according to its website.

The company made headlines in January last year when it raised $300 million from SoftBank Group Corp reportedly at a valuation of $1.2 billion. This month, the Japanese conglomerate was slated to pump in an additional $100 million in the company, per a regulatory filing dated Jan 17, 2020.

SoftBank Vision Fund reportedly holds about 46.6% stake in FirstCry currently.

Prior to Softbank’s funding, FirstCry raised about $125 million in total from investors including IDG Ventures India (now Chiratae Ventures), SAIF Partners, New Enterprise Associates, and Vertex Ventures, the venture capital arm of Temasek.

In 2016, FirstCry had acquired the franchise division of Mahindra Retail Pvt. Ltd, a subsidiary of Mahindra & Mahindra Ltd, which owned online babycare business BabyOye for $54.2 million in a cash-and-stock deal.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.