INFLECTION POINT VENTURES

Downloaded by : Balwant singh (9503054144) via IPV App on 30-Jan-2024 03:21 PM

SCORE CARD - Relso
Date: 03 February 2024
CXO Genie initiative
Fireants Sourcing Technologies Private Limited

Executive Summary: With a vision to "Make in India" and sell globally to furniture retailer & brands, Relso has evidenced encouraging initial traction to build a managed manufacturing platform for solid wood furniture. Furniture market is India and globally is expected to grow at CAGR of 11% and 8%, from current market size of US$17.6B and US$766B respectively, presenting a large white space for Relso. Relso is leveraging the enabler role in this value chain by bridging the
gap between growing curated furniture demand from domestic and overseas brands & retailers with unorganised SME furniture manufacturers having excess production capacity. Founders Anshul Choubey (CEO), Abhinav Agrawal (COO) and Jay Trivedi (CTO) collectively having an experience of 24+ years in sales & marketing; technology and supply chain have built initial revenues of INR 1 Cr+ in furniture orders in 2 (two) months of starting operations. Existing customers are
Livspace, Homelane, Urban Ladder and Antiques & More for export orders.
About the start-up Scores

Porter's 5 Forces (In terms of influence over following factors)

Disrupting / New market
Relso is catering to B2B segment in furniture market for
both India and Global.
They are playing an eco-system enablers' role wherein one
side they have contract manufacturing agreements with
SME Furniture manufacturers catering demand of brands
and retailers across the globe with modular design in solid
and engineered wood segment,
In-house developing technology for operational intelligence
and demand aggregation aims at end to end digitisation of - Addressing exigencies in demand is accomodated
Influence on Customers (Brands/Retailers)
- High quality modern design furniture made available
at competative price.
- High fulfillment experience ensuring adherence to
delivery timelines with reliable manifacturing processes - Reducation in rejections at customer front with Relso
ultimately resulting in lower rejection rate.
- Flexibility on MOQs (Minimum order quantity) as low
as 30 pieces for a product category.
Comments Comments Comments
Influence on Suppliers (SME Factories)
Proof of concept Ample supply @ target cost Vision
- Optimising capacity utilisation through standardise Founders have a clear vision of organising a
processes (currently have tied up with 4 manufacturers Relso Managed Manufacturing Contracts large & fragmented solid wood furniture 85
75
in Jodhpur with capacity of 650k Sq Ft) 80
with 4 (four) mid sized manufacturers with market on the supply & demand side by
Early revenues of INR 1 Cr from solid wood
cumuative 600,000 SqFt space. Higher upgrading small and medium manufacturers
furniture orders in two months validates
frequency of orders placed with these with technology enabled production practices.
centrally handling procurement of seasoned wood early traction in a tough market
onboarded manufacturers will drive cost
meeting quality standards. efficiency.
Build manufacturer base Leadership
75
- Payment surity with 20% advance against the order to drive scale and adopt
and remaining 80% received at the time of delivery. Size of market disruption Managing the business complexity technology enabled
standardised Need a strong Finance Controller as well as

Supply Chain
supply chain giving traceability of raw material sourcing, with cloud factory set up. - Efficiency in production lead time with just in time Rising household manufacturing SOPs by second layer in Sales, Design, Operations &
Managing working capital for material 75 Tech team to augment business expansion. 1. Founders have deep
inventory, logistics and wastage at supplier front and purchase of material from customer PO received 85 incomes & aspirational SME units to manage
Huge Furniture Market - India US$17.6B procurement & receivables; On-boarding old understanding of the
getting quick quotes based on quanity & customisations spend on home décor efficient supply chain
and Global US$760+B. Global wood school-promoter driven manufacturers, problem that they are
with order tracking for the B2B customers. driving demand for Solid from raw material
furniture market is ~ US$413B and enhancing tech platform for production solving.
Wood furniture in India procurement to dispatch Business acumen
estimated to be at US$644B by 2030. processes; and implementing manufacturing
and globally. Curated of finished products to 85
SOPs to be tested on scale. 2. They are passionate &
range of contemperory B2B customers.
bring complementary

Differentiator / Disruption
designs with MOQ Anshul focuses on growth and overall
Cost to operation flexibility for Small & Ability to execute/scale leadership; Abhinav handles entire supply functional skills.
Early Revenue Stage to establish steady Medium Sized B2B chain and Jay leads technology.
state gross margins. Current initial furniture customers is key 3. Anshul Choubey, CEO
75 Adoption of Relso specified Manufacturing Passionate & motivation
orders accruing 10% gross margins on differentiator. Relso is 80 has over 8 years of
SOPs by SMEs and securing repeat export
domestic orders due to inefficiencies in focusing on solid wood experience in B2B sales &
orders are critical to drive profitability at

Founders / Promoters
production systems. However as supply Passionate founding team to identify white 85
manufacturing focused
category whereby India scale.
chain inefficiencies are solved for, domestic space in furniture cloud manufacturing space supply chain through his
has a distinct advantage
orders are expected to accrue 18% grorss with focus on building successful business experience with ITC, Bain
Quality vs incumbents due to availability of Comments
Product / Services Substitutes Investor's view natural wood. End and Shadowfax.
Unit economics Execution
consumer's persona for
Relso offers 10k+ standardised SKU designs in solid and Direct : Basant; Latiyal, Mahadev Crafts, other Positives: To be tested at scale. Initial feedback from Founding team has evidenced execution 4. Abhinav, COO is an IIM
solid wood has the Positive unit economics at current stage 80
engineered wood category. unorganised SME furniture exporters 1. Large market, conseting multiple players to exist. customers on quality, order fulfillment and capabilities with intial traction of orders, Calutta & IIT Roorkee
80 propensity to pay a higher from domestic orders; Gross Margins are at 75
2. Passionate and visionary founding team; with each design range has been as per Industry including first few export orders in a graduate with deep
price for premium fit & ~ 9.5%; Export Orders will give better
B2B customers are given elasticity in MOQ with as low as Indirect: IKEA; Amazon; Craftmills has 8+ years experience standards. challenging space. understanding in sourcing
finish of the home decor. blended gross margins of ~24%.
30 items in a specifically curated product cateogry with 3. Curated SKU designs with competitive price points Experimental mindset & supply chain challenges
- Low revenue base
price and quality standards matching with Industry. and Flexible MOQs Speed vs incumbents Long term sustainability currently mainly from Continuous expansion of design catelogue having worked for Kearney
4. Supply chain standardisation to bring efficiency and domestic orders with with modularity in solid wood that can be mass 85 and Shadowfax.
Relso is building trust factor with overseas customers by cost benefit for both supplier and customer. blended gross margin of customised for flexible MOQs, Technology
creating execution experience warranting speed of delivery Capturing export customers; dynamic 80
~9%, Export business has adoption by mid sized units. To be tested at 5. Jay, CTO is also an IIM
of quality furniture through realible manufacturing Risk/ Mitigants: 75 design catalogue; modularity in
To be tested at scale with increasing potential to earn gross scale for quality consistency & design novelty. Calcutta & IIT Roorkee
manuafacturing at high volumes and rapid

Business quality
processes. 1. At scale, credit risk and working capital management volumes for domestic & export orders. margin of ~30%. alumnus, bringing his
technology adoption for managed Problem solving
will be a challenge; Need to bring in strong Current traction with 4 SME suppliers was - Long Term sustainability enterpreneurial experience
underwriting specialist to maintain risk along with ECGC manufacturing will drive long term business in building tech at Relso.
easily managed. is not a challenge 80
2. Building tech and ensuring adoption by SME moat.
considering business A focused team with deep industry knowledge,
supplier; Solutions exist, need to integrate and execute acumen & execution adept at receiving and implementing feedback,
3. Adherence to delivery schedule; Include penalty Funding in sight capability of founders. and skilled in creating standardized designs
clause in PO issued to SME suppliers. - V Cats is in process of
Comments
closing funding
documents for current
Real significant problem Current raise will provide runway for around 80 round; Networking ability
80
12 months, however will require venture
debt to fund working capital to increase
Large & fragment base of micro & mid sized The team is able to network well to build
order book.
furniture manufacturers for solid wood that relationships with owners of units, B2B
have sub-optimal capacity utilization.
85 customers, investors and potential key hires to
Experienced HR professional, with deep understanding of sector. Able to sustain and focus on growth; need some leadership guidance- Furniture retailers/consumer facing brands build the business
Huge demand of
seeking contemporary solid wood furniture contemporary solid wood
Anshul Choubey Abhinav Agrawal Jay Trivedi designs with customisatable MOQs. Comments Comments
Founder evaluation criteria Overall furniture as market is
CEO COO CTO
Cost of acquisition experiencing a surge in Entry barriers Domestic scalability
Customer / Traction

1 Vision Low CAC with organic and word of mouth demand due to rising Relationships with owners of mid sized Furlenco, Homelane, Livspace already
growth till now; Plan is to hire furniture disposable incomes, manufacturers;Relationships with B2B 70 customers to Relso. With growing demand for 85
2 Leadership
designers to expand design catalogue and 80 higher spend on home furniture buyers;Tech enabled managed solid wood furniture, huge scalability for
3 Business Acumen on-field business development team to tap furnishing. Founders have manufacturing platform for solid wood domestic furniture market
4 Passion & Motivation overseas markets. been able to onboard well- furniture. International scalability
"Antiques & More"; "To the Market" are couple
5 Execution Customer stickiness known customers like New entrants The market for solid wood 70
of export retailers as current customers. Recent traction with solid
6 Experimental Mindset Homelane, Livspace, Blended advantage of in-house design furniture is large and
Stickiness on Relso managed manufacturers Demonstrating fulfillment capability will ensure wood furniture supply to

Substitutes

Scalability
7 Problem Solving 75 Urban Ladder, along with capabilities, initial network of manufacturers 70 growing that can absorb 2
and B2B furniture buyers to be tested at higher orderbook and customers. Homelane (domestic) and
8 Networking ability export customers such as for solid wood work and flexibile MOQs (three) to 4 (four) tech Possible downside
scale. 60 Antiques & More (exports)
Antiques & More. along with initial export orders. enabled managed
Tech adoption by SME manufacturers, validate a global market
manufacturing platforms
*Valuation Summary: Relso is looking to raise INR5 Cr in current round with IPV carve out of INR 1.5 Cr with INR0.50 Cr green shoe option at a pre-money valuation of Pricing Substitutes elongated working capital cycles and delay in opportunity.
in the long term.
Floor INR 40 Cr and Cap INR 52 Cr. (15% discount for a priced round done within 6 months and 25% discount for a priced round done within 12 months. Else conversion will order fulfillment are key challenges to scale.
happen at floor valuation). V Cats have already committed INR2 Cr with other angels bringing in INR1.5 Cr. Maximum 25 cap table seats are available, accordingly in case of In line with other players in market; scope
for price optimisation to improve production Global funiture expos such as IHGF Fair, Global comparatives
oversubscription commitment with higer amount will be given preference.
margins and unit economics. Pricing for 80 Neocon Canton Fair, Milan Furniture Fair 75 75
With the launch of the MBA (Main Bhi Angel) program, you have an option to commit a minimum amount of INR 1 Lakh applicable for your first 5 deals while committing via Export markets expected to be higher than whereby furniture buyers currently procure. QW Furniture, Amazon, IKEA
AIF route only. for domestic markets for a like-to-like MOQ.

Comments INVESTMENT RECOMMENDATION

Disruption Customer Supply Chain Business Substitutes Team Scalability Investor's View Exit options

J J J J K J K J Series A, Strategic investment; Strong VC

80

J
interest observed globally Huge growth space will
attract both VC and 78
79 80 77 78 72 82 73 82
Strategic investor interest;
Profitability
Investors View

Disclosure How can IPV help the start-up to grow (Defined action items) A lot of room of cost optimisation with Export business will drive

Overall
process standardisation, with increase of higher profitability but will
80
IPV Team export business, gross margin of ~24% is also need more working
Mentor : Mitesh Shah 1 : Facilitate customer connect via IPV & CXO members to scale (large logistics companies) projected. capital hence manging
WC efficiently would drive
Lead Member : Rajiv Indimath 2 : Specific mentoring / guidance by SMEs on leadership, execution at scale and build effective supply chain Growth
the business towards
Analysts : Chintan Vyas, Simran Mehta, Akshay RS & Gunjan Verma 3 : Exploring synergies by connecting other portfolio companies like Boingg; Walter systems Rapidly creating a netowrk effect between
profitability & growth.
mid sized manufacturers & B2B customers,
Legal Expert : Ashrika Rastogi 4 : Creating a Let's Grow team to facilitate senior leadership guidance and support to help scale the business. VIEW: RECOMMENDED
5 : AWS Credits worth $25k and other partnerships payment gateway, receivables management, etc. Downloaded by : Balwant singh (9503054144) via IPV App on 30-Jan-2024 03:21 PM design iterations, deepening operational
team and technology adoption are critical
85

for growth
Disclaimer : Although IPV performs an extensive business and financial analysis of the proposal with the available industry expert help also, the views in the documents represent personal views of the respective IPV HQ Lead / Co Lead / experts based on the past financial performance,
future projections and estimates shared by the start-up. Each investing member should apply their own reasonable judgement based on their risk appetite and individual understanding of the concerned business before taking the investment decision.