Voonik is a fashion shopping app that makes recommendations to shoppers based on their profile and preferences, and was launched in February 2014. “Fashion startups have to address a fairly large market with a differentiated offering,” says Ali, 36, who cofounded Voonik with Navaneetha Krishnan.
Like Voonik there are many other online fashion startups that continue to be backed by investors. For instance, Fashion talent and tech startup 6degree. Founded in July 2015, it raised $2,00,000 from Indian Angel Network in June. Shopwati, a social fashion discovery platform launched in September 2015, raised a round of undisclosed seed funding in June. And six-monthold Pretr, an omnichannel fashion marketplace, claims to have started getting feelers from investors, while two-month-old online WittyBae too got an undisclosed angel investment in June.
Voonik, claims it is receives a 20% commission from sellers, that it has had 10 million app downloads so far, does 30,000 shipments every day and has raised some $27 million in three years. “Online fashion is not a winner-takes-all market. So it is very attractive for investors,” says Ali, who raised $20 million in his latest round of funding this June.
Though there have also been losses registered by such organizations like Jabong and Myntra(which was acquired by Flipkart 3 years ago) investors continue to back a bunch of existing and new startups in the online fashion segment.
Investors say that the trend is likely to continue. Reason: the opportunity to build an online fashion brand in India is huge. “I don’t believe the market will be controlled by just one or two brands,” says Tushar Singh, investor member of Indian Angel Network, which has invested in fashion etailers FabAlley and Styledotme.
Sinha of Jabong sounds a word of caution to hamper the excitement of the new fashion startups. “Funding can be a boon as well as a curse,” he says. It depends on how one uses it, he adds. As like other things in fashion, funding too can go out of fashion if profitability takes a back seat. But for now it is definitely a profitable and upcoming segment.