The company will invest $25 million (Rs 187.5 crore) in the joint venture with ASG, the operating partner of Swedish furniture retailer Ikea in the region.
“ASG gets customer insights and supply-chain solutions to the JV while we bring our product and execution capabilities,” Livspace cofounder Ramakant Sharma told ET. It is expecting healthy revenue from the home interiors and renovation segments in Saudi Arabia.
The company’s growth over the next one year to year-and-a-half will come from expansion into new markets abroad, more non-metro and smaller cities within India and by improving unit economics, said Sharma, who is also its chief operating officer.
“Within the GCC (Gulf Cooperation Council), we intend to expand to another six to seven cities. It is a $15 billion worth of total addressable market that we are chasing,” Sharma said.
According to Sharma, the company’s current revenue run-rate is around $175-180 million, which is expected to grow to $300-350 million within the next two years.
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The company currently operates in India and Southeast Asian markets such as Singapore.
“We are trying to build a truly global company out of India with almost 20% of our new sales coming in from markets outside of India,” Sharma said.
For the financial year ended March 31, 2020, the company posted new sales of $225 million. “We expect new sales to be around $650-700 million over the next 24 months,” Sharma added.
Founded in 2014 by Sharma and Anuj Srivastava, Livspace claims to be the largest omni-channel home interior and renovation platform today. It has delivered more than 100,000 rooms and is selling over 7.5 million items through its platform.
So far, Livspace has raised more than $200 million in capital from investors including Ingka Ventures (the venture arm of Ikea), TPG Growth and Goldman Sachs.
“Our India business is operationally profitable and we are appropriately funded as of now and hence are not looking at raising further capital,” Sharma said.
With its technology, Livspace brings homeowners, design professionals, vendors and brands together on a single platform.
The JV in Saudi plans to invest in top talent across levels while also aiming to reach 500 design and execution partners in the region by 2022.
“Given our ready launch and scale template, we are today market leaders in India and Singapore. Our platform also allows us to explore JV models to quickly expand our services in both new and existing markets,” Srivastava, who is also its chief executive, said.
Livspace offers designs, execution of interior design, renovation services, supply of materials, and fit-out elements for the home. It is also focusing on mobile applications, artificial intelligence, machine learning and visualisation solutions for the home improvement industry.
“This partnership with Livspace will allow us to expand the scope of the customer experience from the beginning of the design of the home to the end of implementation,” ASG CEO Saud Alsulaiman said.
In India, Livspace currently serves 13 metro and non-metro areas: Bengaluru, Delhi, Noida, Gurgaon, Mumbai, Thane, Pune, Hyderabad, Ahmedabad, Kolkata, Kochi, Jaipur and Chennai.
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