Ratan Tata has reportedly going to exit from Lenskart, the online retailer that sells eyeglasses, sunglasses, contact lenses and eyewear accessories, after he invested in the startup back in April 2016. The development was reportedly by Entrackr, citing anonymous sources, who revealed the Lenskart board passed a special resolution to convert the preference shareholdings of Tata through secondary sale.
The report further said the request for liquidation was made by Tata and that it had allotted 24,246 equity shares at a face value of Rs 2 each to Tata, according to regulatory filings. But details about how much Tata made through this investment made five years ago remains unclear.
According to a 2016 Mint report, Tata had invested around Rs 10 lakh in Lenskart in a round that valued the company at $240 million. But more than financial investment, it is Tata's role as a mentor that benefits startups.
Small investment, big role
It is Tata's common practice to investment small, but play a key role in advisory and mentorship. Similarly, he had invested Rs 10 lakh in Zivame back October 2015, which was reported his smallest investment yet. But Tata's exit from Lenskart could lose that prominent role, if he played any, in Lenskart's growth.
An official statement from Lenskart or Tata is yet to be released.
Lenskart IPO and profits
Lenskart is preparing for an IPO in the coming fiscal. In just ten years, the company is already turning profits. In FY20, the company's operating profits shot up 90 percent to Rs 900.3 crore with a profit of Rs 6.32 crore. Backed by the likes of SoftBank, Chiratae Ventures, TPG, PremjiInvest and Unilazer Ventures, Lenskart has raised $459.6 million across equity and debt round to date.