The Sleep Company raises Rs 184 crore from Fireside Ventures, Premji Invest in Series C funding

Founded in 2019 by Priyanka and Harshil Salot, The Sleep Company uses tech, science and ergonomics to make office chairs, pillows, mattresses and the like.

The Sleep Company, a direct to consumer mattress maker, said it has raised Rs 184 crore in its Series C round where existing investors like Premji Invest and Fireside Ventures doubled down on their commitment to the company.

Moneycontrol was first to report about the development on November 9.

As reported earlier, the company will use the funds to increase its product offerings, enhance brand visibility and strengthen its omnichannel strategy. The company, which currently has 60 stores, will expand its offline footprint to open a total of 100 stores in the next six months, especially in Tier 1 and Tier 2 cities.

“Our journey is defined by remarkable growth and expansion. We have witnessed an impressive 6x growth in two years, reaching an annual revenue run rate (ARR) of over Rs 350 crore as of September 2023, a significant leap from Rs 60 crore in November 2021,” Priyanka Salot, co-founder, The Sleep Company, said in a press release.

The company has also been toying with the idea of introducing accessories like seat cushions, back cushions, neck massager pillows and the motorised recliner sofas, all of which use its Smartgrid technology, to increase revenue streams.

While the company did not reveal its valuation, sources had earlier told Moneycontrol that The Sleep Company is likely to be valued at around $180 million, a significant premium from its previous valuation of around $120-130 million.

"We recognised the immense potential of The Sleep Company and in a year’s time, we are thrilled to see their exceptional growth trajectory, their drive towards a powerful omnichannel strategy and their consistent profitability,” Dipanjan Basu, co-founder, Fireside Ventures, said.

Fireside Ventures backs D2C brands and recently made bumper returns from its initial investment in Mamaearth, which listed on the bourses earlier this year.

The Mumbai-based company ended FY22 with a revenue of Rs 56 crore, a jump from Rs 11.8 crore in FY21, as per Tracxn, a private markets data provider.

While The Sleep Company generated a profit of Rs 87 lakh in FY21, it slipped in the red and incurred a loss of Rs 11.6 crore in FY22. The company’s scale grew in the previous fiscal year and it likely ended FY23 with a revenue of around Rs 150-170 crore but was still a loss-making venture. It is yet to file the FY23 results. The company's top line is likely to double to about Rs 350-370 crore in the current fiscal.

“The company's remarkable journey since 2019, marked by aggressive omnichannel growth and strong unit economics, has solidified our confidence in their capabilities...we are reaffirming our support to The Sleep Company by doubling down on our initial investment," said Varun Khandelwal, Principal of Investments at Premji Invest.

Founded in 2019 by Priyanka and Harshil Salot, The Sleep Company says it uses tech, science and ergonomics to make office chairs, pillows, mattresses and the like. It competes with SleepyCat, Sundayrest and Sleepyhead. Even traditional players like Sheela Foam have been stepping up with acquisitions to compete with new-age players.