Just a month after minting a fresh round of $20 million, fashion e-commerce platform Voonik is back at it again. But instead of diluting more of its stock holdings, the company has raised another $3 million in venture debt financing from Innoven Capital to increase Voonik’s runway by a couple more months.
The freshly infused funds will be used mainly to meet the marketing costs of the advertising campaigns, especially towards the television commercials. Sujayath Ali, CEO, Voonik told ET that,
It is funding that we get at our terms, without the need for further dilution. It also allows us to take our time to close the next round.
We have been in conversations with InnoVen Capital for a long time now, and it’s a strong relationship that has been established over a period. Also, given their strong track record of working with the portfolio companies of our investors, there is a massive comfort factor.
He further adds that the $3 million raised from InnoVen Capital — a Temasek-backed venture — includes the $2 million which had been secured in the previous equity round. And he expects the remaining amount(i.e $1 billion) to be transferred to the company’s account early next week.
Prior to this round of funding, the fashion e-tailer had bagged a staggering $20 billion in Series B from a pool of existing investors, including the likes of Sequoia Capital, Seedfund and Beenos, among others. This was also the biggest round of funds ever raised by the company and were to be used for strengthening all three core product categories — Vilara, Voonik and Mr. Voonik — on the platform.
The news of debt financing also comes at the heel of the news of the merger of two of the biggest fashion e-commerce platforms — Rocket Internet-backed Jabong and Flipkart-owned Myntra — in India. Thus, other fashion e-tailers rushing out the door to secure more funds to increase brand value and boost customer acquisition is a definitive reality.
Ali, however, has also added that the company is undeterred by the mega Myntra-Jabong deal.
Voonik founded by Navaneetha Krishnan and Sujayath Ali in 2013 claims to be India’s first stylist-handpicked fashion store. The company’s focus is to provide a personal shopping experience that helps you dress well within their budget. Also to create premium fashion products for the masses, the company has acquired three startups, namely — Zohraa, Picksilk, and Styl.
InnoVen Capital, on the other hand, is a recognized name in the Indian startup ecosystem. The VC firm has followed in the footsteps of some key marquee investors, specially Sequoia. It has also invested large sums of money in online food delivery service Faasos, healthcare startup Practo and online car rental services provider Zoomcar. It’s most recent backing includes ed-tech startup Byju’s, which is now planning to use the infused funds for international expansion.