Velocity secures $20 million in funding round led by Valar
Bengaluru-based fintech startup Velocity has raised $20 million (about ₹150 crore) in the Series-A funding round led by the US-based venture capital firm Valar Ventures, doubling down its previous investment.
Launched in early 2020, Velocity offers revenue-based financing as an alternative to venture capital and traditional bank debt to e-commerce businesses and so far onboarded over 1,500 e-commerce businesses.
Other investors who participated in the current funding include Presight Capital, Utsav Somani’s iSeed, Maninder Gulati’s Oyo, Zac Prince’s BlockFi and Philippe de Mota’s Hedosophia.
Combined with the $10 million seed round announced earlier this year, this brings Velocity’s total equity raised till date to $30 million. In addition, Velocity has also secured multiple debt lines with leading NBFCs to rapidly scale its revenue-based financing platform.
The fintech player has over ₹1,200 crore of fundable revenue connected to its platform and has already processed over 250 investments across 175 companies, it said in a statement, adding that it has plans to deploy over ₹1,000 crore to over 1,000 e-commerce businesses, Abhiroop Medhekar, co-founder and chief executive of Velocity, said.
The direct-to-consumer segment is expected to grow at an annual rate of 25% from $44.6 billion in FY21 to $100 billion by FY25, he aid quoting market data.
Increased internet penetration, widespread use of digital payments, and the pandemic-induced adoption of online buying resulted in 88 per cent order volume growth on such websites in 2020.