Mithun Sacheti, the founder of the online jewellery marketplace CaratLane, comes from a family of jewellers. He studied gemology in the United States and ran his family business under the brand name Jaipur Gems. It was founded in 1974 by his father and served over 3,000 wealthy families in Mumbai. Despite doing well in the family business, Mithun, on the other hand, wanted to move out of it to do something big.
Everyone in his family had physical stores but they had never planned launching an online business. However, Mithun was determined to be the first to take his family business online. He asked his father for “Rs 75 lakh and four years” to prove himself right. After much thought and discussion, the money was deposited into his account, and Caratlane was born in 2008.
Caratlane: Mithun Sacheti’s Struggles And Growth
Although Mithun created the website – Caratlane, no sales occurred during the first fifteen days and he was ridiculed by others. Even no investor or venture capitalist came forward to put money in his new venture.
Caratlane had suffered losses to the tune of Rs 12 crore. While contemplating his next move, Sancheti once received a message from an American investor and it changed his path forever.
American investment firm Tiger Global’s partner Lee Fixel was interested in meeting him. Later, a term sheet for Rs 27 crore against 33% stake in Caratlane was given to Sacheti 50 minutes into the meeting and it was a turning point for him.
After accepting the offer, Mithun Sacheti invested Rs 4 crore in marketing. The website surged in popularity but quickly crashed. He also launched the first physical store at Greater Kailash-1, in Delhi. The concept was straightforward: offer premium diamond jewellery in an omnichannel format with higher margins.
Soon after the concept gained traction, Caratlane reported a 300 per cent increase in revenue. This company was worth Rs 100 crore in 2013. In 2012, Tiger Global invested Rs 30 crore, and in 2013, it again invested Rs 45 crore. Mithun Sacheti continued to grow using the omnichannel model because it had surplus capital.
Mithun Sacheti opened stores in Bengaluru, Mumbai, and Delhi in addition to introducing Perfect Look, a virtual jewellery try-on. Caratlane had expanded to 12 locations and reached yearly sales of Rs 300 crore by 2014. Tiger Global later invested Rs 180 crore.
Mithun Sacheti contemplated finding an offline partner as potential competitors such as Mellora and Bluestone emerged online and Titan, the owner of Tanishq, was the ideal candidate.
After Titan came onboard it returned Tiger Global’s Rs 357 crore investment and acquired 62% stake in Caratlane in July 2016.
Caratlane opened 130 stores in 36 cities across India by December 2021. That year, it generated revenue of Rs 621 crore and, for the first time in its twelve-year history, recorded profit.
In August 2023, Titan acquired the remaining 27.18% stake held by Sacheti and his family in Caratlane for Rs 4,621, taking the total stake to 98% at a valuation of Rs 17,000 crore.
Caratlane currently has 227 stores spread across 88 cities, generating revenue of Rs 2,200 crore and over Rs 160 crore in profit in FY23. Mithun Sacheti has genuinely turned this business into a brilliant gem.
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