Peeko raises $3.2 million in funding from Stellaris to scale babycare quick commerce

(L-R) Chetan Sharma, Vivek and Khetan Abhijit Gairola - founders of Peeko

Babycare-focused quick commerce startup Peeko has raised $3.2 million (around Rs 28 crore) in a seed round led by Stellaris Venture Partners, with participation from angel investors including Maninder Gulati (ex-OYO), Kunal Bahl and Rohit Bansal (Titan Capital), Abhishek Goyal (Tracxn), Nitin Gupta (Uni), and Arjun Vaidya (V3 Ventures).

Moneycontrol was the first to report in May that Bengaluru-based Peeko (formerly Cavi) was in advanced talks to raise $3–4 million from Stellaris.

Founded by IIT alumni Chetan Sharma (ex-Leap), Vivek Khetan (ex-OYO) and Abhijit Gairola (ex-Leap), Peeko is attempting to build a vertical quick commerce model for babycare products, with deliveries in under 60 minutes. The startup is currently live in 10 Bengaluru pincodes with a single 4,000 sq. ft. dark store and will roll out its app in September.

Peeko's bet is that babycare — a category where apparel and toys make up nearly three-fourths of the market — has been poorly served online.

According to Chetan Sharma, co-founder of Peeko, deliveries in this segment often take 2–3 days, even in top cities, while inconsistent product quality leads to high return rates.

"There is also huge catalogue fatigue — despite there being a huge catalogue of products, it is not addressing the right needs of the customers. Another issue is poor product quality, which leads to poor customer shopping experience and high returns," he told Moneycontrol.

This, coupled with babycare's high repeat purchase potential – frequent wardrobe upgrades, and demand for diapers, wipes, toys and gear – makes it a high-frequency and higher average order value (AOV) category.

Benchmarking against FirstCry, the largest organised player in this segment, consumer spends in the category average around $100 (Rs 10,000) annually, with heavy users spending more.

The defensibility test

Defensibility, however, remains a key challenge. Horizontal quick commerce majors such as Blinkit, Instamart, and Zepto have already expanded their assortments beyond groceries into categories like gifting and electronics, and could add babycare SKUs with relative ease if demand scales up.

FirstCry, which dominates the category through its offline-heavy network, is also well-positioned to roll out faster delivery models, should consumer demand for quick commerce accelerate.

Peeko argues its differentiation lies in breadth and curation. "We are not just offering diapers or wipes, like some other quick commerce platforms. We are solving for the entire range of baby care products — apparel, toys, shoes, etc. — within 30–60 minutes," Sharma said. To deliver on that, the company is building its supply chain in-house and operating on a marketplace model.

Investors also point out that babycare products don't fit neatly into the economics of generalist dark stores, which are designed around fast-moving essentials and maximizing margin per square foot.

"Barring limited gifting use cases, horizontal quick commerce players are not operating in this category due to the higher number of SKUs. This category will not be able to get space in a regular quick commerce dark store, where there is a maniacal focus on optimizing gross margin per square foot," said Mayank Jain, Principal at Stellaris Venture Partners.

At the same time, however, Peeko's model is still unproven in key ways. Its most ambitious bet — a 'try-and-buy' option for parents to check apparel and accessories at home — has no clear precedent.

"We don’t know for certain if a try-and-buy offering will work in this category, because there are no global or domestic precedents. But that is what Peeko is experimenting with," Jain added.

A broader vertical wave

The fundraise comes at a time when vertical quick commerce is gaining investor traction as an alternative to crowded horizontal plays. Moneycontrol previously reported that other babycare startups such as Ozi and Zoddle are also in talks to raise funding, while vertical models in fashion, food, pharmaceuticals and home services are attracting capital.

For now, Peeko is focused on proving out Bengaluru with more dark stores, curated supply and in-house delivery. "We are focusing on building the right high-quality product assortment for customers within each micro-geography, adding convenience through faster delivery and enabling try-and-buy and instant returns," Sharma said.

Whether that’s enough to carve out a defensible niche before larger players step in will determine Peeko’s long-term trajectory.