28 l ENTREPRENEUR l JULY 2019
A
s I walk into Livspace’s designer office
in Mumbai, I feel the full impact of
what Anuj Srivastava and Ramakant
Sharma have to offer to scores of
middle class families who dream of
building their homes with shoestring
budgets. The Livspace experience
centre has it all. Take a look.
The showroom like space is
sprinkled with various designs for
bedroom, living room, kid’s room,
kitchen, et al. It also houses meeting
rooms to have a detailed chat with customers on the kind of
interiors and furniture they wish to have. There’s a special
virtual reality room too where clients can get inside their artists’
renderings.
This tech start-up operates very much like
a virtual space with CEO and Co-founder, Anuj
Srivastava, functioning from Singapore half of
the year, and Ramakant Sharma, COO and Co-
founder, manning the fort in Bengaluru. How
do they manage from different locations? Apart
from tapping each other for ideas on almost 24/7
basis, both have their boardrooms fully equipped
with facilities like video conferencing to chalk
out execution strategies. “We have aspirations
beyond India, at some point in time, the idea
should go out,” says Srivastava.
The Indian pie is large, too. India’s fragmented
home interiors and renovation market is expected
to exceed $23 billion by 2022. And Livspace is
sure fast carving a niche for itself here.
‘Bromance’ with Design
Like every other romantic start-up story, Livspace
has its roots in IIT. Srivastava and Sharma, IIT
Kanpur grads, spent some quality time honing
their skills at some of the best start-ups. Anuj
worked in Silicon Valley at Google while Sharma
was in Bengaluru with Myntra. “India now is
at a level like the Valley of the early ’90s. So,
for people to have an entrepreneurial instinct
and not to do an idea at this point in time is an
opportunity lost,” says Srivastava.
The opportunity for the Livspace founders
came literally knocking. As they have no
experience or education in design, they faced
multiple problems while designing their own
homes. As they walked into the idea of Livspace,
they started addressing the various concerns of
middle class. Livspace brings the affordability
package into play, offering customers distinct
designs from the best designers. This Uber-like
model of aggregation has worked well.
Sharma says, “95 per cent of India living in
the metros would traditionally call carpenters,
labourers and contractors. They are now getting
the experience which is program-managed by
someone from the design industry.”
To make it all happen, Livpsace has on board
500 vendors and 3000 designers. The margins stand at a good
40 per cent, helping them make money at every order. This
high-margin structure will find further growth if it launches
a private label. Currently, it has partnered with brands like
Hettich and start-ups like Urban Ladder to make their products
available to the customer. Today, modular and wardrobe line of
business alone accounts for 45 per cent of Livspace’s revenue.
Livspace, which started from Bengaluru on a smaller
scale, began its expansion in 2016. It is now on full throttle.
Srivastava explains, “Genzler in San Francisco, founded in 1965,
is the largest interior designing agency on the planet. Since its
founding year till now, it has worked on 10,000 projects. So,
on a yearly basis, Livspace will actually do about 12 to 15,000
homes at the capacity at which we are operating today.” It’s the
same analogy one would apply while comparing an OYO with
the likes of a giant like Marriott. He says, “So you can think of
an elephant which nobody has seen, actually, the
home design of real estate transformation is a kind
of a problem of that class.”
In a way, Livspace has aggregated the spread of
micro agencies operating a platform for customers,
designers, vendors and bringing them all together
on a cloud. Young designers like to be on the
platform for entrepreneurial freedom. Citing
reasons on why suppliers stick to the platform,
Srivastava explains, “They are getting a steady
business, they don’t lose their margin, they can
plan their labour, working capital, all in a much
more predictable way. Designers are actually getting
all the power of technology; they don’t have to go
find vendors.”Managing Substance over Scale
From a vertical marketplace, it comes in easy for
them to expand horizontally. Srivastava says, “There
is a reason Amazon will not get into this space. It
includes nuances of supply chain to make it really
organized in a certain way, than there is a design
selling process.”
Last year, Livspace raised $70 mn in its Series
C round of funding. Most recently, the franchise
arm of Ikea, Ingka Investments, chipped in with
minority funding. “It demonstrates the universality
of our idea; I’m sure in the race, they would have
potentially checked all over the planet to find such
kind of ideas,” says Srivastava.
“We believe Livspace has created a digital
platform that has the potential to transform a
customer’s home furnishing journey. This minority
investments aligns closely with the digital direction
of Ingka Group and our core business, IKEA Retail,
and we are looking forward to exploring new
opportunities together with Livspace,” agrees Krister
Mattsson, Head of Ingka Investments, Ingka Group.
Srivastava shares, “At the top line, the growth
will organically make the business profitable. I don’t
think we want to artificially induce profitability
this early in the company as aspirations are more
significant to invest in growth.”
Livspace is comfortably ensconced in its nicheCover StoryLIVSPACE
LIVE IT UP LIKE
LIVSPACE
Go horizontal rather
than going vertical:
If you wish to target
tech businesses,
there is no point
competing against
Flipkart or Amazon.
Build a deeper
vertical.
Experience it all:
Both co-founders
of Livspace were
professionals,
became
entrepreneurs and
also investors in start-
ups. These roles add
to their mindspace,
knowing what to pay
attention to and what
to let go.
Time for omni
channel: Livspace
built online and
offline touch points
for consumers to
reach out.
Create experiences:
Whether via serving
great product
deliveries or via
showcasing the best
of designs, today’s
customer wants to
gain experience.