Noise eyes overseas market for its wearables, open to fund raising

Smart wearables maker Noise, which won the
Bootstrap Champ award at the Economic Times Startup Awards 2022 earlier this month, plans to take the brand to countries that have a similar demography as India, chief executive Gaurav Khatri told ET.

The company has had “cold conversations” with investors, Khatri said, adding that he would not shy away from raising funds to fuel its ambitions amid fast-paced growth.

Noise recorded revenue of over Rs 800 crore in FY22.
Khatri said the company is at a current annual revenue run rate of Rs 2,000 crore in FY23.

“Through our device, we are solving problems and providing an experience for a specific kind of audience, and we would want to serve a similar kind of audience going forward,” he said. “So, those markets which have a similar geography or similar demography, those are the kinds of audience that we aim to target.”

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Founded in 2014 by Khatri and his cousin Amit Khatri, the startup commenced business by selling mobile phone cases, but later pivoted to designing and selling smart wearables in 2018. Since then, it has seen multi-fold growth in revenue.

“I would not deny that capital is needed,” he said. “More important than capital, you need a partner who takes your thought processes to the next level and brings maturity to the business. You need much more governance, much more stability and a more corporate style of doing things.”

While Khatri did not disclose a timeline or which countries that the company would target, he said securing leadership in the Indian market would take precedence before venturing abroad.

“It is very difficult for me to comment on the time but what we see right now is India is the fastest growing market for the category that we are in and there are a lot of tailwinds,” he said. “We want to be very sure about the market that we are already a leader of and want to have a sufficient share and ensure a stabilized share in the market.”

Noise faces stiff competition both from players within India and abroad.

According to data from Counterpoint Research, Noida-based Fire-boltt beat Noise to claim the top spot in the Indian smartwatch market with a 27.7% market share in the second quarter (April-June) this year, marginally beating Noise, which had a 26% share.

In July, August and September, Noise clawed its way back up with a 29.5% market share while Fire-boltt slipped to the second spot with a 26.2% share, according to market research firm IDC.

Companies such as audio products maker Boat are also bullish on the wearables space with multiple product launches, whereas South Korea’s Samsung is the fourth largest player, albeit with a 2.8% market share.

Khatri believes that the company has built competitive advantages over the past few years.

He said many brands have been trying to enter this category over the last three years, but without creating much differentiation, and that Noise has been able to achieve leadership position for nine quarters straight.

Khatri said smartwatches are not a commoditized category and just picking up the product from any market and selling it in India won’t guarantee success.

“It is more about how you control the user interface, you need to control algorithms, you need to control the sensors, you need to work on the tech and R&D about any feature that you’re launching, which probably gets missed by a lot of brands,” he said.

Noise’s app on the Android and Apple app stores has ratings above four.

Khatri said because of its market leadership, the company has been able to incorporate several features first in the market after receiving customer feedback.

“The forum discussion has helped us achieve a lot of insight which probably allows you to design the product, much before the competition,” he said. “For example, we were the first in the market to come up with SPO2 (oxygen measurement in the bloodstream) in the Indian market during Covid-19.”

Khatri said the company is also in talks with multiple international companies like Bragi to launch products including smart glasses in future.