A booming e-commerce sector is the outcome of the massive adoption of digital technology that the Digital India movement has sparked. However, growth patterns show that rising input costs put businesses and brands under pressure due to increased customer demand. Like this, MSMEs—the micro, small, and medium-sized businesses that make up the economy’s foundation—are searching for new funding sources for their working capital. And this is where many newcomers with access to technology enter the picture.
For instance, Klub, a finance startup, assists companies in obtaining quick, flexible, and founder-friendly capital. The startup uses technology and data to offer businesses a smooth fundraising experience with a team of fintech, investment banking, venture capital, and technology professionals.
“Needless to say, the festive season is important for consumer brands in India,” said Anurakt Jain, co-founder & CEO at Klub.
Unlike most developed countries, where the holiday season is often focused around Black Friday, in India, it lasts for multiple weeks and months, necessitating the development of various marketing strategies by brands.
“What we have noticed is that brands do have an intent to plan but a lot of under planning also happens in terms of demand, people, and resources due to which brands miss out on the topicality of the festive season,” said Jain. “Generally, most of the brands see growth of 20x in their revenue in the festive season but how many of these brands can sustain that uptick is the real question. Smart brands that plan ahead in time do see remarkable growth post the festive season as well and maintain the influx of demand to increase their revenue month-on-month.”
Additionally, startups like GetVantage use revenue-based financing, a data-driven strategy to finance early-stage startups and small and medium-sized enterprises. It mostly provides funding to companies in exchange for a percentage of their gross revenue.
“Consumer demand is back in force as economies bounce back post-Covid. As we look ahead at the festive season, we are seeing increasing interest from D2C brands looking to double down on marketing and inventory in order to ramp up and meet expected demand from consumers,” said Bhavik Vasa, founder at Mumbai-based GetVange. “Our revenue-based financing fintech platform has become the preferred partner for hundreds of D2C brands in the last two years as they look to tap into founder-friendly, equity-free working capital alternatives to supercharge growth.”
