Velocity, a leading cash flow-based financing platform, has allocated Rs 400 crore fund to support D2C and e-commerce brands in preparation for the upcoming festive season. This allocation represents a 60% increase from the Rs 250 crore set aside in 2023.
Festive season sales are critical for digital-first brands, contributing approximately 40-50% of their annual sales. The new capital will help these brands invest in inventory, marketing, and operational expenses without diluting their equity. This type of debt financing is particularly valuable for managing seasonal peaks.
“As more Indian consumers turn to online shopping for its convenience and personalised 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. This is an exciting time, as innovation and customer-centric strategies are driving the e-commerce and quick commerce boom,” Abhiroop Medhekar, Co-Founder & CEO of Velocity, said.
“Velocity’s debt financing is specifically 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,” Medhekar, added.
The funds will be available to brands on major e-commerce platforms such as Amazon, Flipkart, Myntra, and Shopify, as well as quick commerce platforms like Blinkit, Instamart, and Zepto. Quick commerce has become a significant sales channel, accounting for 15-30% of sales depending on the category.
Velocity’s financing aims to support brands in enhancing their product assortment and delivery timelines and to capitalise on emerging trends like premiumisation. According to a RedSeer report, e-commerce sales are expected to grow by 20% during the 2024 festive season, up from a 13% increase in the previous year.
Velocity has a history of supporting digital-first brands, having assisted over 1500 e-commerce companies such as Koskii, Power Gummies, and Bewakoof. The platform’s financing will help these brands address inventory challenges and meet festive demand.
“Velocity stepped in at the right time for us just before the festive season to provide us financing for inventory. The entire process was seamless and was completed in 5 days, which helped us place orders in time and meet our growth targets. Their systems and processes are by far the best compared to other players we have worked with. Looking forward to working with Velocity for all our future inventory funding requirements,” Aarti Koya, CEO, EKAM (Aromee Brands), said.
Founded in 2020, Velocity is a cash-flow-based financing platform that provides non-dilutive debt financing to e-commerce and D2C businesses. The platform has disbursed over ₹900 crores and has raised $30 million in equity funding. Velocity partners with major marketplaces and ecosystem players to offer innovative financing solutions.
