Funding momentum is building in the early-stage quick-fashion delivery space, as investors double down on startups focused on fast-moving fashion products with shorter turnaround times, even as concerns linger around the model\u2019s sustainability.<\/p>\n
Mumbai-based quick-fashion delivery startup Knot<\/a> has raised a $3 million round led by Kae Capital<\/a> with participation from Sparrow Capital, its founder Archit Nanda told ET. Gurugram-based fashion commerce platform Zulu Club recently closed a $250,000 funding from early-stage venture capital firm TDV Partners.<\/p>\n The funding round at Knot saw participation also from the founders of direct-to-consumer brands like Snitch, Souled Store and Bonkers Corner and Aukera, a company dealing in lab-grown diamond jewellery.<\/p>\n Knot plans to use the capital to expand beyond Mumbai to cities such as New Delhi, Bengaluru, and Pune, strengthen its product capabilities, and onboard additional partner brands. It was founded earlier this year by Nanda and Rachit Bansal, following a pivot from their previous social networking startup, Slick.<\/p>\n Also Read:<\/strong><\/strong> Rapid fashion delivery gathers pace, but long-term viability in question<\/a><\/p>\n The startup has partnered with more than 70 brands, including Snitch,The Souled Store, The Bear House, and Off Duty.<\/p>\n \u201cShopping behaviour has fundamentally shifted. Earlier, it was more casual, when people would scroll through a website or walk into a store and figure out an occasion to wear something later. Now, shopping is very event-driven, and moods are shaped by what users see on their Instagram feed,\u201d said Nanda.<\/p>\n Zulu Club, the Gurugram-based startup, does not operate its own offline stores but offers services through existing general retail outlets in malls and other locations.<\/p>\n \u201cWe believe the next wave of growth will come from verticals that offer a hybrid experience, blending the convenience of online ordering with the trust and tangibility of offline retail,\u201d said Zulu Club founder Adarsh Bhatia.<\/p>\n The recent funding deals come as new-age brands like Newme, Slikk, and Snitch, alongside ecommerce platforms such as Myntra, Ajio and Nykaa<\/a>, experiment with ultra-fast delivery models in the fashion category.<\/p>\n Slikk, which offers 60-minute delivery, recently raised $10 million in a round led by Nexus Venture Partners<\/a>. Snitch secured $40 million from 360 One Asset with plans to enter quick commerce. Meanwhile, omnichannel fashion brand Newme, which targets Gen Z consumers, raised $18 million in a round led by Accel<\/a>, with participation from existing investors Fireside Ventures and AUM Ventures, as reported by ET.<\/p>\n \u201cQuick commerce has revolutionised the way we purchase grocery, essentials and it’s extended to a few other categories beyond your daily provisions. However, fashion commerce has not been reimagined since the yesteryears when Myntra and others entered the space. It has continued to remain the same,\u201d said Sunitha Viswanathan, partner at Kae Capital.<\/p>\n \u201cThere needs to be a new platform-led approach. Gen Z cares about tight curation, fast delivery, and quick returns so that their money doesn\u2019t get blocked,\u201d she added.<\/p>\n Tough road According to venture capital investors, success in this competitive space hinges on how well startups manage both supply chains and demand generation.<\/p>\n \u201cThis segment is a lot about how you manage your entire supply chain and your inventory and working capital. That gets linked to how you manage your entire demand generation engine,\u201d said Vikram Gupta, founder and managing partner of early-stage venture capital firm IvyCap Ventures, which has invested in Snitch.<\/p>\n \u201cIf you are able to connect with your end consumer in terms of not just the variety of options they have, but also the speed of change of styles and fashion, that is what makes one successful,\u201d Gupta added.<\/p>\n Despite the challenges, industry executives believe that more capital will flow into the quick-fashion space in the coming months, driven by shifting consumer habits.<\/p>\n \u201cWe’ll see more and more startups coming up in different verticals, especially in quick commerce. Over the course of more than a decade, trends have evolved in ecommerce, which later moved to food and grocery delivery platforms to fast fashion,\u201d said Ujwal Sutaria, founder of TDV Partners, adding: \u201cWe will see more investments in fast fashion for at least next 12-18 months.\u201d<\/p>\n
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Still, the model isn\u2019t without its hurdles. Earlier this week, Ansh Agarwal, cofounder of Blip, announced that the ultra-fast fashion delivery startup had shut down less than a year after launch, citing fundraising challenges.<\/p>\n