Bluestone raises $30 million funding, to double down on omnichannel play

Jewellery retailer Bluestone said it has raised over $30 million in funding at a valuation of $410 million from Hero Enterprises.

The company is raising money almost after six years. The funding comes on the back of a shift in the company’s strategy. It is looking to transition from a wholly online platform to the omnichannel model – that is, having both online and offline stores.

“One big realisation we had especially after that (2016) round was that online-only was not going to make us a very big company given the nature of the category and consumers’ preference of using both online and offline modes,” said Kushwaha. “So the obvious thing for us to transform to an omnichannel game from a purely online game. That’s what we were busy doing for the past three to four years.”

Kushwaha said 90% of sales originate online, but 65% are converted offline. That is, 90% of customers browse and shortlist their purchases online and travel to a physical store to complete the purchase.

“Omnichannel has played out well not just for us but also for other players like Lenskart and Nykaa,” he said. “I admit we were a bit late but we are trying to catch up as quickly as possible. In general, it is working out very well for us and we noticed very strong omnichannel behaviour, especially in our category.”

Kushwaha said this has resulted in a 20x jump in business, which will continue in the current financial year with revenues of Rs 500 crore, an 85% jump from the same time last year.

In the next two years, the company is targeting annual revenue of more than Rs 2,000 crore. Since opening its first store in July 2018, it has opened 70 stores across more than 20 cities, mostly in north India. Bluestone said it plans to open 100 more stores in the next year and aims to have 300 stores by 2024.

Kushwaha said that the omnichannel transition has not hurt the company’s financials as it relies on a franchisee model to expand its offline presence. He said Bluestone is profitable and will have a net profit of Rs 1-10 crore in the current financial year.

Kushwaha said the proceeds of the latest investment will primarily be invested into technology, design and manufacturing of jewellery, and for marketing and promotional activities.

It’s last fundraiser was a Rs 200-crore round in 2016, led by IIFL Holding and Accel Partners. Other investors include RB Investments, Kalaari Capital and Ivycap Ventures.

ET reported on February 28 that Bluestone was planning for an initial public offering (IPO), aiming to raise Rs 1,500 crore. Kushwaha confirmed the development.

“We are in the initial phase of discussion with bankers. We will kickstart the process in a couple of weeks. The timeline we are aiming for is the second half or the end of the next fiscal year,” he said.

Courtesy: Economic Times