Net revenue run rate is the sale value of goods excluding returns and discounts.
This comes at a time when the roll-up commerce sector is facing headwinds, with the likes of US-based Thrasio cutting costs amid a change of chief executive.
Roll-up commerce companies buy multiple online sellers that operate on Amazon and other ecommerce marketplaces, and with the aid of better management and shared expertise, help them sell better.
Narayanan told ET that over 30% of the company’s revenue now comes from markets outside India, and that 50% of its brand portfolio is available outside the country.
Mensa operates in the United States, UAE, Canada, UK, Germany and Singapore through marketplaces and its own direct-to-consumer (D2C) websites, the first such company to enter the overseas markets.
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“We are not burning money in any brands, we are only using the money that we have raised to acquire new brands,” Narayanan said.
The company aims to double its net revenue run rate to Rs 3,000 crore over the next year and will hire 700 people to double its team size to 1,400 as it eyes further expansion in India and abroad.
Mensa already operates 20 online brands and will look to add 20 more.
The company operates popular online fashion brands like Dennis Lingo and Karagiri.
Narayanan expects some deals to be relatively cheap going forward owing to the slowdown in startup funding.
The company said it had also turned Ebitda-positive positive excluding the one-time deal expense to acquire its brands. Ebitda stands for earnings before interest, tax, depreciation and amortisation.
“We had a very good start to the year. We are at Rs 1,500 crore in net revenue run rate, we have more than 20 brands, organic growth rate of these brands is over 80%,” said Narayanan.
Mensa operates brands across fashion, lifestyle and home categories.
Narayanan said the company may look to enter a new category this year.
He described the company’s technology as the “secret sauce” that has helped Mensa achieve scale with positive unit economics.
“There is demand side and supply side. On the demand side we have built out brand analytics, we have built out pricings, there is API integration with Amazon, Flipkart, Ajio, Myntra,
. We have the ability to look at real-time data, pricing, reviews and ratings, we scrape the ratings,” he said.
“On the supply side, we have warehouse management, inventory management, order management and forecasting models. We have built out all these systems internally and that is our secret sauce,” Narayanan added.
Mensa sells its brands both on marketplaces as well as its own websites.
Narayanan said entering new markets will not be a cash-burning exercise.
“On Amazon, your reviews and ratings translate there. It gets carried forward in other markets as well,” he said. “The expenses of product development and selling online are all centralised in India.”
The company has three offices in India — in Bengaluru, Gurugram and Mumbai.
Narayanan also expects acquisitions to become cheaper as funding dries up, especially in the roll-up commerce space, which received record seed funding rounds in 2021.
While many companies started out with the same objective and similar funding rounds,
ET reported on April 20, citing several industry trackers, that well-funded houses of brands such as Mensa Brands and Firstcry-backed GlobalBees have cornered a substantial chunk of the funds and acquired a plethora of brands, leaving behind smaller players such as Upscalio, Goat, 10Club, Powerhouse91, Evenflow and Bzaar.
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