TenderCuts burned roughly INR 400 Cr (160 Cr investment +78 Cr + 130 Cr + FY 23 revenue) in 32 months (Jan’21 – August’23) for setting up a network of just 50 retail stores (INR 8 Cr/Store)
Was TenderCuts creating a network or only buying/building the stores?
How come it is being acquired in a distress sale to a company (Good to Go) with just 9 Cr in revenue in FY 22?
If they were building/buying stores, then the cost of those assets should be way more than just INR 9 Cr.
Also, how did TenderCuts survive for 3-4 years (2017 – 2020) with just a seed round of $759 K (INR 6 Cr)?
It seems like a case of spending too much on paid marketing to acquire new customers rather than trying to retain the existing ones
A quick Google search about TenderCuts reviews is full of customers complaining about the quantity and quality of products (though my personal experience in BLR has been good).
Or maybe is it another case of “founders getting carried away and their passion to survive the intrinsic challenges of the sector and manage capital took better of them”.