Fintech startup Velocity has raised $20 million in Series A funding round led by venture capitalist Peter Thiel’s Valar Ventures, the Bengaluru-based company said in a release.
Presight Capital, Utsav Somani’s iSeed, Maninder Gulati (Oyo), Zac Prince (BlockFi) and Philippe De Mota (Hedosophia) were among others who participated in the round.
The startup aims to deploy over Rs 1,000 crore towards more than 1,000 e-commerce businesses, the release said.
“Our vision is to build the future of business financing in India. We are glad to partner with high-conviction investors like Valar since our early days. They have re-affirmed their belief in Velocity by doubling down and leading our Series A,” Velocity co-founder and CEO Abhiroop Medhekar said.
“We are already India’s largest revenue-based financier and keen to use this funding to build multiple world class products for thousands of new age businesses.”
Launched in 2020, Velocity has established revenue-based financing as a credible alternative to venture capital and traditional bank debt for e-commerce businesses in India.
Velocity has, so far, raised $30 million in equity funding. It has also secured multiple debt lines with leading non-banking financial companies to rapidly scale its revenue-based financing platform.
Velocity works with over 1,500 direct-to-consumer (D2C) and e-commerce businesses and has over Rs 1,200 crore of fundable revenues connected to its platform, the release said. It has already processed over 250 investments across 175 companies.
Brands that have historically raised capital through Velocity have grown their revenues by 1.5x within six months of funding and 78 percent of these brands become repeat customers, the company has said.Its portfolio includes D2C brands such as PowerGummies, Green Soul, WallMantra, BellaVita, Smoor Chocolates and CrossBeats.