 "Sujayath Ali, Navaneetha Krishnan")
Since childhood, Sujayath Ali's father has commented on his weird sense of fashion - rather, the lack of it. After he got married, his wife picked up from where his father had left off. "I thought spending more, getting luxury brands would be the solution," said the founder of e-commerce fashion retailer Voonik.
But, he thought: "One doesn't need to be a geek to buy a laptop. So, why does one need to know about fashion to buy fashionable clothes?"
It was 2013. The condition of the economy was not ideal to venture into the choppy waters of entrepreneurship. But, Ali was convinced with the idea. "I wanted to create a new way of shopping, enabling users to buy what suited their lifestyle and budget," he said.
Ali, chief executive officer of Voonik, has worked at Visa and Amazon and has a Master's in Business Administration from the Indian School of Business, Hyderabad.
Co-founder Navaneetha Krishnan, then working at Freshdesk, was convinced. He has always been a start-up techie, having worked at Zoho and Aryaka.
He quit his job, Ali returned to India from the US, and they launched the venture.
A Personal Stylist
Voonik aspires to be the "personal stylist of every woman", says Ali. With a sophisticated technical platform, Voonik allows users to choose clothes that would best suit them. It takes into account various factors, such as their body type, lifestyle and budget.
"Before our company was launched, the fashion e-commerce sector in the country was dominated by portals that focused on bringing known brands to fashion-forward and relatively affluent sections of the society. There was nothing for those who had a more limited budget," said Ali.
On the supply side, there were a large number of un-branded garment makers and sellers, engaged in a horizontal price war on e-commerce portals.
"We created a visually rich, fashion app aimed at the mass buyer, who has to constantly balance budget and priorities," Ali added.
The application uses an advanced algorithm that takes into account different parameters and uses an artificial intelligence-based feed.
"When a person goes to a boutique, she gets not only an extensive portfolio of products but also assistance to choosing what would best suit her. We are trying to replicate that experience online," said Ali.
The app takes into account the recommendation of a stylist and the preference of the customer. Voonik has massive following in Tier-II and -III cities - at least 65 per cent of their users are from small towns.
"We are fast moving towards our goal of becoming the country's largest online buying company," said Ali.
Funding and buying
So far, so good, but a look at the funding and how Voonik is planning to meet challenges is a good way to get an idea of its fundamentals.
In its latest round of funding, Series-B, the firm raised about $21 million (Rs 143 crore). The round was led by Sequoia Capital. The other participants were Times Internet, Seedfund, Beenos, Beenext, Parkwood Bespin, Tancom Investments, Kunal Shah and InnoVen Capital.
"In 2013, Bloomberg TV ran a programme where start-ups pitched their ideas. The best idea would win seed funding from us," said Bharati Jacob, co-founder and partner, Seedfund.
Voonik won the competition, and bagged a seed fund of $500,000 (Rs 3.4 crore in current exchange rates).
Explaining why they chose Voonik, Jacob said: "We liked the team and their idea. They are doing something unique: Finding fashion that suits the budgets of people, making them look good and feel good."
"Voonik is trying to democratise fashion," she added.
Jacob is all praises for the company's team. "They have surpassed all our expectations. They are very passionate, quick learners and understand the technology very well. They have made remarkable progress, eating very little capital."
Acquisitions and future plans
Recently, Voonik shot into the limelight with five major acquisitions: Getsy (menswear), Zohraa (marketplace for designers and boutiques), Picksilk.com (connecting thousands of pure silk weavers to discerning buyers), Styl (stylists and salons) and Dekkoh (servicing consumers who seek stylist).
These acquisitions have not only helped Voonik consolidate its position in the $60-billion (Rs 4-lakh-crore) apparel market in the country but also expand its portfolio. This, Team Voonik believes, will help in future growth.
"We believe the mid-price segment, which comprises 75 per cent of the market, will continue to be dominant. At present, its size is about $45 billion; by 2020, it will be about $80 billion. We plan to be the leaders of this segment," said Ali.
For this, they are looking at expanding categories and making forays into unexplored segments.
"Already, we are seeing a good traction in footwear, western wear, lingerie, skin care, make-up and plus-size categories. In the coming weeks, we want to scale each of these categories to be at least 50 per cent of the current size of our main categories," said Ali.
Voonik has also launched
Mr Voonik, the first personalised shopping app for men in the country. "It is generating a lot of consumer interest," said Ali. "We are sure that in the coming months, Mr Voonik will be at the level of Voonik's scale of operations." Their investor, Jacob, agrees. "They have the best operational and financial metrics in the country."
It's a challenging road ahead. But, the team at Voonik is raring to go.
EXPERT TAKE
Every start-up must ask two questions: What core-user problem is it solving and what can it do that others can't?
The trick in answering these is to figure how strategically valuable and defensible whatever you are building is. For instance, if your early growth came from SEO hacks, or maybe the ability to rapidly scale paid marketing, the question is if any of this is really defensible. History remarkably repeats itself, so there are learnings there. Between 2009 and 2012, eBay's classified assets in Canada and Europe - many of which had grown exponentially - lost 30-50 per cent of traffic thanks to step changes in Google's search algorithms! Similarly, Fab.com went on to a sad demise in 2014, despite going from zero to hero in nine months and claiming a billion dollar valuation, driven by the ability to scale facebook marketing via an algorithmic platform.
Fundamental differentiators take time to build. You can tell by two leading indicators: (a) the user conversion rate increases steadily, which reflects increasing value for each user over time; and (b) consistent month-on-month growth whilst decreasing burn, which means you are creating a truly valuable platform. If this is happening, celebrate. If not, it's time to go back to the first two questions.
Suchi Mukherjee, founder & CEO, Limeroad.com
