Singapore-based Zimplistic, the company that manufactures the fully-automated flatbread maker Rotimatic, has been sold to the special purpose vehicle (SPV) Light Ray Holdings in a trade sale, DealStreetAsia has learnt.
Light Ray Holding has acquired 100% of the company. It will now run Zimplistic and bring out the next iteration of Rotimatic, while retaining the entire current team.
Zimplistic — founded by entrepreneurs Pranoti Nagarkar Israni, and Rishi Israni — is backed by Credence Partners, EDBI, Robert Bosch Venture Capital, Openspace Ventures, Bosch, VIT, and Distinguished Gentlemen Group, according to Crunchbase data. It had raised a total of $48.5 million from the investors.
One of the investors told DealStreetAsia that all prior investors have taken significant haircuts on account of Light Ray Holsing acquiring Zimplistic. Another investor compared the deal to the acquisition of Singaporean online grocer RedMart by Alibaba-backed Lazada in 2016, which resulted in the major investors taking a haircut.
In 2018, Zimplistic posted accumulated losses of $39 million and clocked revenues of $21.2 million. In the year, it had loss after tax from continuing operations of $23.61 million, according to the company’s most recent regulatory filings in Singapore. That was wider than 2017’s loss after tax of $9.79 million.
According to a Business Times report in October last year, the company was burning through cash that almost outpaced its fundraising. “Net cash used in operating activities [in 2018] soared more than five times to $19.9 million, which works out to a burn rate of $1.66 million a month,” the report said.
The report added that Zimplistic’s biggest market in 2018 was North America, which accounted for 71.6 per cent of its total revenue. Asia (including Australia and New Zealand) and EMEIA (Europe, the Middle East, India and Africa) each accounted for about 14 per cent.
Zimplistic’s troubles mounted amid COVID-19 as it encountered difficulties in February, when its supply chain in China was disrupted. It was forced to enforce pay cuts for its staff. “There were many conversations before we implemented it [the pay cuts]. We knew what was coming and discussed with our employees what was the best option forward. The team then considered employees’ backgrounds — whether they were single-earners, had to provide for many kids, or had other major financial commitments,” Rishi Israni was quoted by Business Times in May.
Zimplistic is among the few hardware startups to emerge out of Singapore. Rotimatic is a fully automated robot roti maker, designed for home use. Rotis are an unleavened flatbread of Indian origin and are a staple in many Indian diets.
The Rotimatic machine, priced from S$1260 onwards, can produce around 20 rotis at a time, with customisation options for oil, thickness, and roast.