Home interior startup Homelane on Wednesday said it has agreed to buy smaller rival DesignCafe in a deal that will value the combined entity worth Rs 3,000 crore ($358 million).
Separately, the combined firm is raising Rs 225 crore ($27 million) from existing investors as well as external investor Hero Enterprise.
Post-acquisition, the combined entity is expected to achieve a revenue of Rs 1,000 crore in FY2025, up 33% from Rs 761 crore in FY2024, and be EBITDA profitable.
Currently, the combined entity is at an annual recurring revenue of Rs 900 crore, is cash profitable, and at -2% EBITDA.
While DesignCafe was founded in 2016 by Gita Ramanan and Shezaan Bhojani, HomeLane, which operates four brands— HomeLane, Doowup, and Cubico (corporate interiors) and Wrapzap, was established in 2014.
HomeLane, Doowup, and DesignCafe will continue to operate as distinct end-to-end interiors brands, each catering to different segments of the market.
The acquisition is expected to unlock significant savings across areas such as manufacturing, design, procurement, and technology.
DesignCafe raised Rs 40 crore, led by private equity fund WestBridge Capital, Mirabilis Investment Trust, and venture debt fund Alteria Capital, in March last year. Homelane secured funding worth $9.1 million in a bridge round from its existing investors last year.
