Interior Design firm Homelane signs Rs.225 crore acquisition deal to take over Design Cafe

Omnichannel home interior and renovation platform HomeLane has announced its intention to acquire DesignCafe, a prominent player in the home interiors sector. The acquisition, pending regulatory approval, is anticipated to create one of India’s largest interior companies.

Once the acquisition is complete, the combined entity is projected to generate a revenue of Rs.1,000 crore which is equivalent to$120 million in FY25, marking a 33% increase from Rs.761 crore ($92 million) in FY24, and is expected to achieve EBITDA profitability. HomeLane, Doowup, and DesignCafe will continue to operate as separate brands, each targeting distinct market segments.  

Additionally, HomeLane revealed a Rs.225 crore or $27 million funding round, featuring investments from current backers of both HomeLane and DesignCafe, along with new funding from Hero Enterprise.

The acquisition is set to unlock significant synergies in areas such as manufacturing, design, procurement, and technology, which HomeLane stated will enhance operational efficiency and foster innovation and customer satisfaction across the offerings of the combined entity.

HomeLane co-founders Srikanth Iyer and Tanuj Choudhry noted that the merged company is already generating an annual revenue run rate (ARR) of Rs.900 crore and is cash profitable, with a slight EBITDA loss of -2%.

HomeLane offers comprehensive interior solutions and boasts a team of over 1,400 design experts serving more than 20,000 customers. Prior to this funding round, the company had raised $115 million from investors including Accel, Peak XV, and IIFL. According to TheKredible, HomeLane reported a revenue of Rs.574 crore in FY23, with a loss of Rs.173 crore.

Bengaluru-based DesignCafe provides customized online design and decor services and has raised nearly $30 million to date.