Delhi NCR-based High Street Essentials, which owns omni-channel women’s fashion brands FabAlley and Indya, has raised approximately $1.1 million (Rs 8 crore) in a debt funding round from Trifecta Capital.
This is Trifecta Capital’s second round of debt infusion into the company. It had previously invested Rs 5 crore in the startup in January 2018.
With this round, the company has raised a total of $15 million to date, according to data available with VCCEdge.
In its last funding round, the startup had raised Rs 60 crore in Series B funding from SAIF Partners in December 2018.
Launched in June 2012 by Shivani Poddar and Tanvi Malik, FabAlley is a women’s western wear label, which claims to identify global fashion trends and convert them into affordable apparel, jewellery, accessories, shoes and bags for Indian women. The company then launched Indya, an ethnic-fusion brand, in 2016, to address the contemporary Indian wear market. Subsequently in October 2019, the startup unveiled its third brand Zyra, a fashion jewellery brand.
High Street Essentials sells its merchandise through its own website, other online marketplaces and offline through large format retailers such as Lifestyle, Central, Globus and Shoppers Stop. In FY20, it scaled up its retail footprint with 10 new Indya stores and five FabAlley stores. It also operates more than 30 exclusive brand outlets and 350 shops-in-shops across the country.
The company plans to deploy the fresh funds to fuel the offline expansion of its brands, it said in a press statement.
“In the next 12-18 months, we plan to grow our retail presence by increasing our exclusive brand store count to 50 and doubling our shop-in-shops to more than 650. The capital expenditure required to fund this growth is best done through debt, since it reduces the cost of capital and improves return on equity,” Malik and Poddar said in a joint statement.
The company reported a 21-time increase in net profit for 2018-19 at Rs 1.3 crore, led by strong sales and lower base effect. It has reported an operating profit of Rs 3.3 crore, its second operating profit in a row. The startup’s revenue has doubled year-on-year to Rs 90.3 crore on account of improved distribution, product expansion and platform strengthening.
Nearly all major online vertical fashion businesses have pivoted to an omni-channel model in search of better brand recall, high revenues and improved unit economics.
“Continuing with its omni-channel strategy, the company has doubled-down on the offline segment in the past couple of years. This strategy has reaped rich dividends in the form of stellar growth. They are among those rare startups that have remained profitable even while scaling up rapidly,” said Nilesh Kothari, co-founder, Trifecta Capital.
Recent deals in the sector
Fable Street Lifestyle Solutions, a Delhi-based startup that retails premium workwear brand FableStreet, raised about $3 million in a Series A round led by Fireside Ventures last month.
In November, online fashion rental platform Rent It Bae merged with Mumbai-based fashion rental startup Flyrobe to expand its omnichannel footprint.
In the same month, Sensedynamic Fashions India, a Bengaluru-based startup that owns fast-fashion ecommerce startup Styched, raised an undisclosed amount in a seed funding round from angel investors.
In October, Kanvas Consultancy, a Mumbai-based startup that owns the personal styling and ecommerce platform StyleCracker, raised $2 million in a seed round from US-based venture capital fund AMJ Ventures.