Deal Talk: Livspace in talks to raise $100 million; Lightspeed, Sequoia harvest big returns from Oyo

Bengaluru-based online home design company Livspace is in talks to raise $100 million at a valuation of over $500 million, Mint reported citing sources. The report said that the round is expected to be led by European investment management firm Kharis Capital and Singapore-based growth stage investor Venturi Partners.

Livspace was founded in 2015 by IIT Kanpur alumni Ramakant Sharma and Anuj Srivastava. It offers an online marketplace for home interior solutions and claims to have designed and delivered solutions to over 7,5000 homes. 

The company has raised over $103 million over three funding rounds. It last raised capital in May 2019 which was led by Ingka Investments, the investment arm of Ingka Group which owns Swedish furniture giant IKEA. Prior to that, the company raised a Series C round of $70 million in September 2018 which was led by Goldman Sachs and private equity firm TPG Growth. 

Lightspeed, Sequoia and OYO

Venture capital firms Sequoia Capital India and Lightspeed Venture Partners have collectively earned between $400-$500 million from the sale of around 15% in hospitality unicorn OYO to its founder Ritesh Agarwal, The Economic Times reported.

The deal itself was reported last month. 

According to the latest report, Lightspeed earned a profit of $200 million on the $850 million deal, whereas Sequoia earned $150 million on the $450 million buy back. Lightspeed and Sequoia held $13.4% and 10.24% stake respectively in Oyo. Lightspeed had reportedly invested $28 million in the company, while Sequoia invested $25 million.

Agarwal has reportedly financed the buyback by taking a loan from Japanese banks Nomura and Mizuho. With the share buyback, he now owns close to 30% stake and Softbank owns around 50% in the company. 

According to media reports, this is the second-biggest investor exit in India, after global retail giant Walmart brought 81.3% stake in Indian ecommerce company Flipkart for $16 billion in 2018.