Frendy, a digitally connected convenience store network for smaller towns and rural India, on Monday, announced it has raised a bridge round of Rs 16 crore ($2 million) following its last round of Rs 23 crore in May 2022. The latest round was led by Auxano Capital, AT Capital Singapore, Metara Ventures – Priya Joseph, Rohan Jain & Rishabh Jain – founders of The Wellness Co., Apurva Solapur family office & existing investor Desai Ventures.
The startup said it may extend the round up to Rs 24 crores via a follow-on rights issue and will use the current capital to expand the tech offering, private label product portfolio and expansion of stores.
Based in Ahmedabad, Frendy is currently operational in over 40 Tier 2-6 towns in Gujarat, serving 50,000 customers and over 4,500 products. Frendy’s convenience store network for smaller towns and rural areas consists of franchised Frendy Marts digitally connected to a cluster of Frendy Micro stores. Frendy Marts are modern self-serve stores typically 500 -1000 sq. ft in size offering 1,000 to 2,000 products.
In addition to serving walk-in customers, the Marts are also double up as a dark store for a cluster of digitally connected 30 to 50 Frendy’s micro stores in a 10 km radius. Micro stores consist of existing family-run micro kiranas and new home-based stores set up by housewives. Micro stores typically carry 100 SKUs, and the balance SKUs are digitally available on Frendy’s app for customers to order.
“We spent the first 2 years building out our micro store thesis and achieved a very strong PMF. In our 2nd phase, we are going asset & operations light with our Franchised Marts doubling up as a warehouse for our existing micro stores and in parallel have scaled down our Central warehouse. Our goal for the coming 12 months is to have 40 operational Marts and further build out our private label offering,” said Sameer Gandotra, CEO, Frendy.
The startup is aiming to achieve an ARR (annual recurring revenue) of Rs 300 crores and profitability in the next 24 months by focusing on growing in its current geographies and using density to build a strong cost moat. The company said it has achieved a revenue of Rs 82 crore in its FY23 which is its 2nd year of operations up from Rs 40 crore in FY22.