The capital will help D2C brands prepare for the demand surge in upcoming festive season sales
New Delhi: Financing platform Velocity has earmarked ₹400 crore to support the financing needs of D2C and e-commerce brands in the upcoming festive season sales, a release by the firm said on Monday.
“As more Indian consumers turn to online shopping for its convenience and personalized experiences, we are witnessing a significant shift towards e-commerce with projections estimating that India will be the world’s third-largest online market reaching $325 billion and attracting 500 million shoppers by 2030,” said Abhiroop Medhekar, co-Founder and chief executive officer (CEO), Velocity. “Velocity’s debt financing is designed to empower D2C and E-commerce brands to scale their operations, optimise inventory, and implement effective marketing strategies. By providing the financial support they need, we’re excited to support the growth journey of several brands as they prepare to capitalise on the festive season demand and e-commerce growth.”
This year’s allocation is over 60% more than the ₹250 crores earmarked by Velocity in 2023, highlighting the industry’s expectations of a bigger festive season in 2024, the release added.
This financing will support brands and sellers on major e-commerce platforms (such as Amazon, Flipkart, Myntra and Shopify) and new-age quick commerce platforms (like Blinkit, Instamart, and Zepto) in enhancing their product assortment, accelerating delivery timelines, and capitalising on emerging trends such as premiumization. This year, quick commerce has emerged as an important sales channel for brands, driving 15-30% of sales depending on category.
Velocity has consistently been a financier of digital-first brands, supporting the growth and success of many D2C companies. Over the last four years, Velocity has leveraged its partnerships with India’s leading NBFCs and regulated entities to empower over 1500 E-commerce brands like Koskii, Power Gummies, Hammer, Bella Vita Organic, Bewakoof, Bunaai, Leaf, Crossbeats, Blaupunkt, Zlade, and Soulflower among others.
Several brands have already raised funds from Velocity to help bolster their growth in the 2024 festive season. Owing to the huge surge in demand during the festive season, one of the biggest problems faced especially by e-commerce sellers is stocking out due to lack of inventory. With the financing support, these brands will now have enough funds to adequately stock their inventory to meet the festive demand.
Velocity has disbursed over ₹900 crores, enabling over 1,500 businesses, especially D2C and e-commerce companies, to overcome working capital challenges. The Bengaluru-based fintech has raised $30 million in equity funding led by Peter Thiel’s Valar Ventures. Its portfolio includes many of India’s fastest-growing D2C brands like Soulflower, Chumbak, and Off Duty.
