Home Storage And Solutions Company Homestrap Wins ₹50 Lakhs for 7% Equity From Shark Tank

Homestrap is a brand dedicated to helping you keep your home organized. They offer a range of products designed specifically for organizing closets, including organizers for sarees, shirts, clothes, jewelry, and shoes. Their products can be found on various marketplaces, and they have successfully served over 1.5 million customers by the time they presented their business proposal. Their goal is to organize every wardrobe in India, and to achieve this vision, they are seeking an investment of ₹70 lakhs in exchange for 1% equity in the company.

Click here to visit their official website: Homestrap

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Akash Mehta and Priyanka Mehta, a married couple from Indore, created Homestrap together. They have been close friends since they were in the 10th grade and have been in a partnership for 22 years. Priyanka is an alumnus of IIM Bangalore, which adds to their entrepreneurial journey.

Homestrap is a company that sells products and last year (FY21-22), they made about ₹17.2 Crores in sales. Their average selling price for each product is ₹505. For the current financial year (FY22-23), they expect to increase their sales to ₹23 Crores, which is a positive growth projection.

The company started in FY16-17 and made ₹2.13 Crores in sales that year. Over the years, their sales have grown:

• FY17-18: ₹7 Crores
• FY18-19: ₹9 Crores
• FY19-20: ₹12 Crores
• FY20-21: ₹19 Crores

However, they faced a bit of a setback when they tried to enter the furniture market, but decided to stop this effort after the COVID-19 pandemic since it didn’t work out well for them.

Their current level of earnings before interest, taxes, and amortization (EBITA) is 3%. This means that, after paying certain costs, they keep 3% of the sales as profit.

Homestrap sells products that have a maximum retail price (MRP) of ₹100. Out of this, they earn ₹55 in gross profit (the money left after selling a product and deducting the cost of making it). They have to pay around 31% of their income to marketplaces (like Amazon or Flipkart) as commission for selling their products. They also spend about 6-7% of their income on marketing, which includes paying for advertisements and working with social media influencers to promote their products.

Last year (FY21-22), the company spent ₹35 lakh (or ₹3.5 million) on marketing. They are trying to grow their social media presence, and although they only had 1,000 followers on Instagram when they started three months ago, they aim to increase this number to reach more customers.

Aman is concerned about the low EBITA and the difficulty of building a brand, Peyush feels he can’t add value, Vineeta worries the product will become too common, and Namita dislikes the product’s quality. In contrast, Anupam shows interest in the market and proposes to invest ₹50 lakh for a 10% stake, also offering the rest as a loan at 10% interest. The company counters with a request for a 5% interest loan for the same ₹50 lakh, while Anupam then raises his offer to ₹70 lakh for a 10% stake. Homestrap also enters the negotiation, suggesting ₹50 lakh for a 7% stake with some debt included.

Homestrap, which focuses on helping people organize their homes, especially their cupboards. They noticed that many families in India struggle with messy cupboards, which they refer to as the “Great Indian Cupboard problem.” Homestrap was created to make it easier for people to keep their cupboards tidy and organized. They did a lot of research to come up with simple solutions that anyone, even a young child, can use to organize their stuff.

Instead of spending a lot of time trying to rearrange things in their cupboards, families can now use Homestrap’s products to make the process quick and easy. This means they can spend more time relaxing and enjoying moments together.