What does Fynd’s 3.4 million funding mean for the Fashion ecommerce

by Rakesh Jain CEO and Co-founder

Fashion industry not unlike other members of the commerce sector is undergoing a digital renaissance. The conventional brick and mortar showroom chains are feeling a significant presence of ecommerce fashion stores and for good reasons. The convenience and 24x7 accessibility offered by e-fashion stores is swiftly gaining on the territory which was previously a stronghold of brick and mortar stores. Evidence to this trend is the funding raised by fashion ecommerce portal Fynd in series A where the company closed its round with $3.4 million (Rs21 crores) raised in funds

What Fynd plans to with its latest capital infusion

The ecommerce fashion portal Start up’s funding was led by IIFL Seed Ventures, with an investment of $2.4 million, and was followed by Singularity Ventures, FJ Labs, Kae Capital,Traxcn Labs, GrowX, and Axis Capital which is based in Hong Kong. According to co-founder Harsh Shah, the capital infusion will be used for boosting the consumer base, accelerating growth, streamlining marketing strategies and reinforcing the tech infrastructure of the company. He also stated the company’s expansion plans which included expanding to 30 cities from the existing 23 cities by the end of the year. Additionally, they have close to 140 branding partnership in pipeline and all are expected to go through within the next 6 months.

The business model that bolsters this growth

The business model of Fynd (a company which started as Shopsense Retail Technologies Pvt. Ltd. In 2012 and later rebranded itself as Fynd in 2015) is an offline to online model where the company sources its product inventory from 8000 offline stores and markets them online via their ecommerce portal. The product is delivered within 4 to 6 hours of being placed thanks to the integrated system within the website.The company’s revenue comes in the form of commission for sale from the store brands which ranges from 20 to 30 percent.According to Fynd, their gross margins touch 20 percent and they are profitable down to the unit level.

What’s important to be noted here is that Fynd doesn’t take on conventional offline fashion stores, in fact the offline stores associated with fynd have reported a growth of 3-5 percent. This unique business model has store owners who couldn’t find their consumers their desired product in the offline store place order at Fynd ecommerce and get them delivered to the consumers directly thus saving their sales.

Venture capitalists seek innovation for a secure investment

According to VidushiKamani, venture partner Kae Capital the reason behind them throwing their weight with Fynd is their impressive growth and how seamlessly and successfully they have migrated from their initial B2B model to the current O2O (offline to online) model. According to her what separates Fynd from the lot is its capability of building a successful commercial model with a strong technical spine.

ecommerce app is crucial to an ecommerce store

As evidently seen above the investors are seeking fashion ecommerce firms that are technically sound and are capable of building a cyclic revenue generation model out of it. A big part of it is having not only a good desktop ecommerce store but also a fashion ecommerce app to go with it. More than 50 percent of the digital commerce in the US occurs via mobile apps so it’s essential to create a fashion ecommerce mobile app for your fashion ecommerce store. So how to go about it? There are numerous apps building solution at your disposal but the most suitable candidate providing all the requisite features is this.

Summary

Needless to say, innovative approaches like above are the future of the fashion and clothing industry. Advancing tech has made facilities like 24x7 access, anywhere shopping, easy returns the basic requirement for any fashion ecommerce firm, therefore it becomes important to keep in mind the above requirements when venturing online with your fashion stores website and mobile app. If your fashion ecommerce mobile app is lacking in any way in above features you are automatically at disadvantage even before entering the market. Taking a leaf out of Fynd’s book can serve to the benefit of many fashion retailers attempting to make a splash in the fashion ecommerce market.