Watchout Wearables is a smart watch brand currently operating in the security watches segment of the market. The startup recently pitched themselves on Shark Tank India. Deep dive into the article and gain insights about the business model of the company and various other variables.
What are Watchout Wearables?
The products of Watchout Wearables focus on providing security smart watches for children. The brand has named their products as “Next Generation, Security Premium Smartwatches.” The primary objective behind the product was to ensure that parents remain well aware about the security of their kids and get real time updates pertaining to their whereabouts.
The product is enabled with a horde of features such as Wi-Fi,GPS, Nano Sim Card and an option for real time messaging. Apart from these features there are various other aspects of the watch. The smartwatch is connected with a mobile application which helps parents gain access to the location and wellbeing of their children.
The brand operates with a single product in its inventory. The product is listed on major e-commerce websites. The smartwatch is sold at a price of ₹ 11,999. The product is also available at offline retail stores of Croma, Jio Mart and Haml Eyes
|Name of Startup||Watchout Wearables|
|Industry||Security Smart watch brand|
|Deal Asked for||5% equity for ₹ 2 crores|
|Finalised deal||10% equity for ₹ 1 crore and debt funding of ₹ 1 crore @15%|
|Sharks||Vineeta Singh and Anupam Mittal|
Founder of Watchout Wearables
Watchout Wearables was founded by Abhisek Baheti who operates as the CEO alongwith Noopur Baheti. It was incorporated in 2021.
What is the status of business operations of Watchout Wearables
The company has listed a single product in its inventory which has a selling price around ₹ 10,000. If we look at the financial statistics of the company they have already clocked a sale of ₹ 1.1 Crore for the FY 2020-21. For FY 2021-22 the organisation has already clocked a sale of around ₹ 1.4 crores.
If we look at the recent sale statistics the company earned a revenue around ₹ 25 Lakh for August 2022. If we look at the EBITDA of the organisation it’s around 3.5%. The company has an overall net margin of 25% over the entire product. The business is based in the house of the founder where he looks after manufacturing and manages around 500 units in a single month.
- Stage OTT Raises Rs. 1.5 Crore From Shark Tank India
- Girgit Raises Rs.20 Lakh Shark Tank India S2
- Dorje Teas Raised Rs. 30Lakh From Shark Tank
- Recode Studios: Start up in Cosmetic Industry Gets No Funding: Shark Tank
Shark tank pitch and valuation of Watchout Wearables
The founders of Watchout Wearables asked for a deal of ₹ 2 crores while staking 5% equity. On hearing the deal Anupam Mittal and Vineeta Singh jointly gave an offer of ₹ 1 Crore at the stake of 10% equity and ₹ 1 Crore debt financing at a rate of 15% interest. This offer valued the company at a valuation of ₹ 10 Crores.
Abhishek tried to counter the effort at a rate of ₹1 Crore by staking 5% equity and a debt funding of ₹ 1 crore at the rate of 15% interest. This valued the company at a valuation of ₹ 20 Crores.
Although Abhishek subsequently tried to counter the offer but the founders said that because the industry was saturated and the product was overpriced according to the Indian market the investment falls in the high risk category. Due to such a heavy risk sentiment the founders refused to budge from their deal. Finally Abhisek relented and came on board with the deal jointly offered to him.
What did we learn?