Targeting to strategically empower direct-to-consumer (D2C) and ecommerce brands for the forthcoming festive season, Bangalore-based cash flow-based financing platform Velocity has launched Rs 400 crore (around $48 million) fund. This is going to be a significant bump up from Rs 250 crore fund that the company had set up for the festive season during the corresponding period last year.
PC: Times of India
The new fund is designed to support such brands and sellers who are placed across major e-commerce platforms like Amazon, Flipkart, Myntra, and Shopify or the new-age quick-commerce platforms like Blinkit, Instamart, and Zepto. The money extended will help the brands deepen their product assortment, quicken delivery time, and ride emerging trends like premiumization without diluting their equity.
A market research report further projects a 20% growth in e-commerce sales in 2024 during the festive season compared to 13% rise in e-commerce GMV witnessed last year. Velocity aims to help brands capitalize on this expected rise in demand.
Founded in the year 2020, the company is run by co-founders Abhiroop Medhekar, Atul Khichariya, and Saurav Swaroop. Velocity uses information and online cash flows, coming from digital-first businesses, to solve the founders’ financing challenges through innovative non-dilutive debt financing for e-commerce businesses.
Velocity has also tied up with India’s top-rated NBFCs and regulated entities to drive the largest number of e-commerce brands—names like Koskii, Power Gummies, Hammer, Bella Vita Organic, Bewakoof, Bunaai, Leaf, Crossbeats, Blaupunkt, Zlade, and Soulflower. The company claims to have disbursed more than Rs 900 crore, thereby supporting over 1,500 businesses, majorly D2C and e-commerce companies.
Velocity competes against players such as GetVantage, Klub, Clearco, CRED Mint, Wayflyer, and KredX in the space. The company has raised $30 million in equity funding, led by Valar Ventures.
In summary, Velocity, a cash flow-based financing platform, has launched a Rs 400 crore ($48 million) fund to support D2C and e-commerce brands for the upcoming festive season. The fund will help brands enhance their product assortment, accelerate deliveries, and capitalize on emerging trends like premiumization, without diluting their equity. This underlines further the surging interest of brands in the D2C and e-commerce sectors in the Indian market, particularly during the festive season mentioned. With Velocity’s financing, which is timely and nondilutive, these are just the types of brands able to heighten their competitiveness to reap expectedly surging consumer demand levels.
