10club Raises $40M Seed Funding

10club Secures $40 Million in Seed Funding

10club, an Indian startup focused on building a business similar to Thrasio, announced on Tuesday a successful fundraising round of $40 million. This represents one of the largest seed financing rounds observed within the South Asian market to date.

Investment Details

The funding round was jointly led by Fireside Ventures, a well-known Indian investor specializing in consumer and hardware technology, and a currently unnamed global investment firm. Additional participants included HeyDay, PDS International, Class 5 Global, Secocha Ventures, and the founders of the hardware startup boAt – Aman Gupta and Sameer Mehta.

It remains unclear if the round incorporates debt financing, a common practice among Thrasio-like ventures, or if the entire sum will be transferred in a single payment.

Business Model: Acquiring and Scaling E-commerce Brands

10club’s core strategy involves acquiring smaller brands that currently sell their products through various e-commerce platforms. The company then focuses on scaling these acquired businesses to reach a wider audience.

According to the startup’s LinkedIn profile, they aim to provide an exit opportunity for entrepreneurs who have successfully established their businesses on platforms like Amazon, Flipkart, and Nykaa. 10club allows these founders to benefit from their prior efforts while navigating the challenges of scaling and increased competition.

The Thrasio-Model in India

10club is among a growing number of companies attempting to replicate the Thrasio model within the Indian market. Mensa Brands, founded by a former executive from Myntra, recently secured $50 million in combined equity and debt. Reports indicate that UpScale, another key player in this space, is currently in discussions with Germany’s Razor Group to obtain further capital.

Focus on Niche Markets

Similar to Thrasio, these firms are targeting brands offering mid-range to high-end products in categories with limited competition. Interestingly, some of these product categories are relatively overlooked, even by major e-commerce platforms like Amazon, which haven’t yet developed their own private label offerings in these areas.

Thrasio's Global Reach

Thrasio, headquartered in New York, has raised over $1.3 billion in equity and debt since December of last year. As of earlier this year, the company had acquired or consolidated approximately 6,000 third-party sellers on Amazon.

Fireside Ventures' Perspective

Vinay Singh, partner at Fireside Ventures, stated that India and online-first brands are poised for significant growth. He believes that both venture capital funding and acquisition-driven models will play a crucial role in accelerating the development of early-stage brands. Singh will be joining 10club’s board as part of this investment.

Future Plans for 10club

Bhavna Suresh, co-founder of 10club and former CEO of Lamudi, indicated that the startup has already established the core components of its centralized platform. They have also secured letters of intent totaling $15 million from various companies. The newly acquired capital will be used to support the operation and expansion of the newly acquired businesses.