IIFL bets on e-commerce, leads Rs 200 crore financing in Bluestone

Bengaluru: Online jewellery retailer Bluestone has raised Rs 200 crore in its fourth round of institutional funding led by financial services firm India Infoline Finance Limited (IIFL) and the e-tailer's early backer venture fund Accel investors. IIFL Wealth Management has set up a Rs 1,000 crore fund to invest in domestic startups and recently participated in a Rs 108 crore fund-raise for NeoGrowth,which lends to small-and-medium sized businesses. Bluestone has raised capital at a time when its offline rival Titan Co, which sells jewellery under the Tanishq brand, said it has invested Rs 357 crore in online jewellery retailer Caratlane for a majority stake.This capital will likely give Bluestone the ammunition to fight its existing competitors like Caratlane, which has an offline presence.

Existing investors Kalaari Capital, Ivy Cap Ventures and RB Investments were also a part of the latest financing round. It is learnt that that funding came in at a valuation of Rs 700 crore. Bluestone's founder and CEO Gaurav Singh Kushwaha, however, did not comment on the valuation the company. In all, the Bengaluru-based e-commerce firm has racked up about Rs 400 crore since its inception.

“We are going to allocate the fresh capital towards offering more designs and choices to the consumer,” Kushwaha told TOI. According to him the company has 45-50% market share of the online jewellery market which is estimated to swell up to $2 billion over the next two three years in India.

“We started Home-Try On about a year back which tries to address the brick-and-mortar experience to consumers by offering them an option to try products at their houses,” Kushwaha said when asked if he would counter Caratlane’s offline presence. Bluestone is also one of the first set of startups backed by Ratan Tata. He said the company would also make additional hiring across design, engineers, marketing and sales, logistics, among others. At present it has 400 people on its payroll. The top metro cities and tier I towns drive 65% of the sales for Bluestone, just like other Indian e-commerce firms. “It is a habit that takes time to change specially for jewellery. While high-ticket transactions do happen at out platform the average ticket size is in the range of Rs 30,000 to Rs 50,000," he said.