Take a moment and think about the challenges that a founder of a company faces on a daily basis. Apart from focusing on the product, research & development, inventory, and profits, they need to focus on growth too. As you know, in the digital age you need to go through cut-throat competition to become a household name. You can achieve it only through exponential growth. Won’t it be beneficial if you take the help of experts for this purpose? One such company that holds this expertise is “Mensa Brands.”
Despite being a newcomer, it has successfully built global digital-first brands through partnerships and acquisitions. It is a consequence of an effective business model.
Mensa Brands: A Brief Overview
Mensa Brands is a startup that partners with D2C (direct-to-consumer) brands or startups to scale up their businesses by making investments. It aids in the exponential growth of partnered brands by leveraging its expertise in e-commerce, technology, category management, demand planning, efficient marketing, etc. This helps the D2C (direct-to-consumer) brands to drive their sales.
Thus, it helps your brands to grow exponentially at a global level. Also, you can get a lucrative financial exit while transforming your business through a successful partnership with Mensa Brands. Mensa Brands acquires the partnered company either by buying a majority stake or completely after the financial exit of the founders. This is the prime motto of Mensa Brands- “Uplift a potent startup and then acquire it.”
Some of the key details of the company are-
- Company’s Name: Mensa Brands
- Type of Company: House-of-Brands
- Headquarters: Bengaluru (Karnataka, India)
- Founding Year: 2021
- Founder: Ananth Narayanan
- CEO: Ananth Narayanan
- Market Valuation: $1.2 billion (Rs.9,840 crore)
- Revenue (FY 2022): $41.2 million (Rs.310 crore)
- Expenses (FY 2022): $88.55 million
- Profit/Loss (FY 2022): Loss of $16.41 million (Rs.135 crore)
Although it faces a considerable amount of losses but it claims this fact as “not a cash loss.” Why? You may ask! Because, it bought and continues to buy significant assets. Mensa Brands amortizes that company’s value for over four years. Thus, at a brand level, its EBITDA will be profitable.
Working Strategy of Mensa Brands
It focuses on building a digital house-of-brands in a sustainable manner. A house of brands is a brand architecture strategy that markets a company’s various products or services independently from one another. The key working strategy of “Mensa Brands” is to partner with the right founders to grow their digital-first brands using superb technologies. “Digital-first companies” are those who focus on delivering their services through digital mediums. Sounds complicated? Don’t worry! We will explain it in simple terms.
What does Mensa Brands do?
Mensa Brands undergoes partnerships with various D2C brands and helps them scale with the indigenous and overseas markets. They focus on the global level because 30% of their revenue comes from overseas markets. Mensa Brand buys a majority stake in each partnered brand. Not only this, but it also envisions acquiring the partnered brand entirely within the period of five years. Mensa is in the process of establishing a digital portfolio of brands by acquiring controlling interests in startups and developing them alongside its existing brands.
Mensa uplifts its partnered brands through the following process-
- Combination of product and pricing optimization
- Technology-led process improvement
- Distribution and marketing augmentation
- Fine-tuning the supply chain
All these strategies significantly accelerate the growth of the brands with an exponential increase in their margin trajectory. The prime objective of Mensa is to strengthen its reputation as “the partner of choice” for potent e-commerce brands. Their focus lies on the “made-in-India Businesses.” Advanced technological advancements help it to scale emerging start-ups digitally. However, certain prerequisites are taken into account: the brands should possess a strong customer base demonstrated by positive reviews and ratings, demonstrate profitability, and have the potential to experience exponential growth by implementing Mensa’s growth playbook, known as the “Mensa alpha.”
How does Mensa work with Brand founders?
If you want to work with Mensa through partnership, then you need to follow these steps-
Step 1: Introduction of your brand (1-2 meetings)
First of all, you need to go through at least two detailed meetings with Mensa. In these meetings, you need to describe your brand’s journey, ambitions, or goals. Since Mensa will support your company both financially and qualitatively, you have to provide a thorough description.
Step 2: Valuation and Commercial Construction (48 hours)
Mensa Brand will provide you with the feedback within 48 hours of the meeting. Here, they will provide you with a fair and transparent commercial contract.
Step 3: Due diligence and Deal closure (4 weeks)
Mensa Brands performs streamlined due diligence and closes the deal within four weeks.
Step 4: Acceleration of the Partnered brand (Journey of your brand with Mensa begins)
In this step, the partnership of your company with Mensa Brand gets established. The contract is signed for five years. It embarks the journey of your brand towards exponential growth.
Step 5: Lucrative Financial Exit of founders (After five years)
Usually, the span mentioned in the contract is of five years. If your company makes significant profits and grows well, then you are provided a lucrative financial exit. This is the final step where Mensa fully acquires your company.
Key working strategies of Mensa Brands
The best analogy for Mensa Brands is that they buy half-finished buildings with strong foundations and then build it. To scale it, one need technology, brand and product building expertise and the right people, which is what Mensa brings to the table. So, the key working strategies of Mensa Brands are-
- Technology: Mensa employs massive usage of data to integrate sales, order, and supply platforms across the brands. This improves the customer experience of the brand partners.
- Optimized Operations: They expand and optimize the distribution to improve the availability of the partnered brand’s products.
- Digital Brand Building: This is the chief target of Mensa Brands is to build digital-first brands through influencer networks, social media marketing, content marketing, etc.
- Channel Expansion: Mensa Brands employs numerous growth hacks across vertical e-commerce platforms. This helps to scale the D2C businesses.
- Data-Driven Marketing: It uses artificial intelligence to forecast demand and supply. Thereby, it optimizes advertising, promotions, and pricing.
- Maintaining Global Supply Chain: Mensa uses its expertise through data to showcase Indian brands at the global level. Thereafter, it focuses on the exclusive packaging of products to optimize the global supply chain.
- Brand Growth: Mensa utilizes its tech capabilities to identify the right trends, optimize content through SEO, manage inventory, and improve profitability. All these tactics aid in brand growth.
Mensa Brands Products
The most sought query of folks is- What are Mensa Brands’ products? But Mensa does not have any products.
Really? A company without products? The answer is no as it has multiple products. All the D2C brands acquired are their products. As you have read above its work is to upscale its partnered brands and acquire them after a period of 5 years if the company performs well. It goes through multiple partnerships with brands that have the potential to grow and raise profits. Thereby, it ensures quick channel expansion and efficient operations to scale up the partnered brand growth. The journey of Mensa Brands has been quite fantastic. Being a newcomer (established just 2 years ago), it consists of over 25 brands. Its continues to grow its brands despite global slowdown.
Which Brands are under Mensa?
Numerous companies are associated with it. They are either acquired by Mensa or in partnership with Mensa.
Mensa Brands Acquisition
Although Mensa is hardly two years old. But it has acquired 25 brands as of March 2023. Recently, it acquired the following brands-
Home & Garden
Beauty & FMCG:
Content & Creators:
Investors of Mensa Brands
- Falcon Edge Capital
- Norwest Venture Partners
- Tiger Global Management
- Norwest Venture Partners
- Prosus Ventures
It has also secured debt financing from Alteria Capital, InnoVen Capital, Oxyzo, Stride Ventures, and TradeCred.
Mensa Brands analyzes the D2C brands having quick-growth potential. Then it tracks them down for acquisition. As you have read, the brand acquisition is the primary goal of Mensa. Therefore, to fulfill this objective, it provides funding and scaling-up strategies (with a digital-first approach) to the target brands. It is backed by prominent investors like Falcon Edge Capital, Tiger Global Management, etc. Currently, its market valuation is over $1.2 billion. It raised a total of $254.3M in funding over 5 rounds. Their latest funding was raised on Feb 7, 2023 from a Debt Financing round.