SoftBank to invest $275 mn in eyewear retailer Lenskart; early investors to exit

SoftBank Vision Fund will invest more than $275 million in omnichannel eyewear retailer Lenskart. As part of the investment, SoftBank will acquire stakes from some of the company’s early investors, the company said in a statement.

Lenskart Solutions, the Delhi-based company that owns and operates the retail platform, will receive $231 million as primary capital from SVF II Lightbulb, a Cayman Islands-registered affiliate of SoftBank, regulatory filings pertaining to the transaction showed. The SoftBank entity is being issued 22.9 million Series G compulsorily convertible cumulative preference shares at a little over $10 a share.

Specific details on the secondary portion of the investment were not available at the time of publishing this report. However, the filings indicate that SoftBank would own a 20.14% stake in Lenskart following the primary and secondary capital infusion.

“The… percentages (20.14%) also include the capital that the proposed allottees (SVF II Lightbulb) may acquire from existing shareholders prior to completion of preferential allotment,” the filings said.

Lenskart did not respond to specific queries from TechCircle on the transaction. 

Mumbai-based investment bank Avendus Capital was the financial advisor to the transaction, the Lenskart statement said.

The company last raised funds in September 2019, when Mumbai-based private equity firm Kedaara Capital wrote a $55 million cheque. It also raised an undisclosed sum from TR Capital, Epiq Capital, Steadview Capital and PremjiInvest in March last year.

Other investors in the company include Chiratae Ventures (earlier IDG Ventures India), Unilazer Ventures, TPG Growth, and Ratan Tata, chairman emeritus of Tata Sons.

According to the statement, the latest capital infusion will be used to augment Lenskart's technology capabilities and strengthen its supply chain infrastructure.

“Technology and AI (artificial intelligence) are the biggest enablers in what we do and want to achieve. Our strategy is to continuously push the bar in customer experience and surprise our customers. Large part of this investment will go in building next generation technology and supply chain…We are thrilled to have SoftBank Vision Fund with us in our journey, " Lenskart founder and CEO Peyush Bansal said in the statement.

Bansal, Amit Chaudhary and Sumeet Kapahi founded Lenskart in 2010. The platform retails every kind of eyewear, including powered sunglasses and contact lenses. It claims to offer over 10,000 different styles to suit all pocket sizes and diverse consumer needs. The company also offers services such as free eye check-up at home and 3D try-ons, among others. The company has its presence across 100 cities with more than 500 offline stores. 

The company plans to expand its services to an additional 150 stores by March 2020 and 2,000 stores over the next five years.

SoftBank Vision Fund, backed by Japanese conglomerate SoftBank Group Corp, launched its second mega global fund for technology investments in July this year with a $108 billion corpus. The second fund follows the nearly $100 billion fund that the Masayoshi Son-led conglomerate floated in early 2017. The fund went on to back companies such as ride hailing platform Uber and co-working giant WeWork, globally, and budget hotel aggregator OYO, online grocery startup Grofers, fintech startup Paytm and online insurance selling platform PolicyBazaar in India.