Mumbai/Bangalore: After picking up majority stakes in online grocery BigBasket and online pharmacy 1mg, the Tata Group is now looking to acquire health and fitness startup Curefit, people aware of the company’s plans told ET. The Mumbai-based conglomerate is in talks to bring on board Curefit founder Mukesh Bansal, who may take up a leadership role in Tata’s digital business, sources privy to the matter said.
Bansal, who co-founded online fashion retailer Myntra, has been running Curefit for the past five years. He launched the venture with Ankit Nagori, a senior executive from Flipkart.
A person aware of the developments said, “Bansal could possibly get a wider role in Tata’s digital businesses, including those in which it recently picked up majority stake, such as BigBasket and 1mg. The discussions are still not final and the terms may change.”
Curefit, which was recently rebranded to Cult.Fit, has so far raised $418 million and was last valued at around $800 million. It counts Temasek, Accel, Kalaari Capital among its investors.
Landing one of India’s leading entrepreneurs is a significant move for the Tata Group, said another source, and will be crucial for its battle with Reliance Industries, Amazon and Walmart-owned Flipkart.
“Bansal’s experience in scaling Myntra from a site selling personalised gifts to one of India’s largest fashion e-commerce players will be vital for Tata as it strings together a digital strategy,” said another person close to the development. Myntra was sold to Flipkart in 2014 for $330 million, after which Bansal joined the e-commerce major and worked closely with the company’s founders, especially Sachin Bansal.
Another source said the group believes in letting sector experts run certain business verticals as they have domain knowledge. “This is even more crucial in the technology-led new economy. Their plan is to let company founders run their businesses,” the person added.
A Tata Sons spokesperson said the company did not wish to comment, while Curefit’s Bansal is yet to respond to an emailed questionnaire.
ETtech Morning Dispatch: Tata building ammo for battle with Reliance, Amazon
Super App launch
Last month, Tata Digital — a wholly-owned subsidiary of Tata Sons Pvt. Ltd. — finally got the nod from India’s competition regulator to pick up a 64% stake in BigBasket, setting the stage for a fierce battle of giants in the fast-growing online grocery segment.
The $1.2-billion Tata-BigBasket deal, a mix of primary capital investment and secondary sale of shares by existing BigBasket investors, was seen as a critical piece in the group’s overall Super App launch, which will bring all of its digital businesses under one umbrella.
Along with the big bet on grocery e-commerce, Tata is also investing in healthcare and fitness. The 1mg transaction, in which Tata is expected to pick up a 55% stake, and now the Curefit discussions signal a major push in these high-potential sectors.
ET reported earlier this month that the Tata Group had increased the authorised share capital of Tata Digital to Rs 11,000 crore from Rs 1,000 crore, according to regulatory filings, hinting at increased funding for its e-commerce business.
Covid-19 severely hit Curefit’s business
It has been a rough 15 months for Bansal as Curefit’s core business of offering fitness sessions through gyms has been hit hard by the pandemic. After the first wave last year, Curefit—which also operates Eat.Fit—shut many of its cloud kitchens. Last May, the company fired almost 10% (around 800) of its staff and announced pay cuts across levels as its gyms remained shut. In July, Curefit again furloughed another 500 of its employees, exited smaller cities, and cancelled plans to expand to foreign markets such as the UAE.
After restarting its physical operations late last year, the second wave again forced the company to shut its gyms. The company has since tried shifting its fitness and gym business online through streaming sessions.
Meanwhile, Bansal and Nagori also undertook significant restructuring at the firm. Curefit group said Eat.Fit, the cloud kitchen business, will be run as an independent entity. Nagori is now running this business and recently revamped its branding and logo. Earlier this month, Curefit said it had rebranded its health and fitness platform to Cult.Fit.
https://m.economictimes.com/tech/startups/tata-eyes-curefit-buy-to-build-digital-muscle/amp_articleshow/82984544.cms
