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FabAlley Raises Venture Debt from Trifecta Capital

Started by two women entrepreneurs Shivani Poddar and Tanvi Malik, FabAlley is an online-first fashion brand that caters to young women across the country.

Online-led Fashion Brand FabAlley has raised Rs 5 Crores in venture debt from Trifecta Capital. This infusion of capital comes close on the heels of Rs 12 Crore Series A round that FabAlley raised in late 2016 from India Quotient and other angel investors. The brand plans to deploy these funds primarily for their offline growth.

“We have a clearly identified use case for debt as we move towards a more aggressive omni-channel growth strategy. Offline expansion is a more capital intensive proposition and funding these capex requirements is best done through debt which is lower cost capital as compared to equity.”ShivaniPoddar, Co-founder, FabAlley said.

Started by two women entrepreneurs Shivani Poddar and Tanvi Malik, FabAlley is an online-first fashion brand that caters to young women across the country. The company retails online through their own website and through large online marketplaces, servicing over 2,000 orders a day.

In 2016, FabAlley expanded its footprint to the offline market with a tie-up with Central, Future Group’s large format fashion retail chain. Currently, FabAlley and Indya, a fusion-wear brand run by the company, are available at more than 55 touch points. The successful launch of the two brands with Central proved to be an inflexion point for offline expansion for the company, with the launch of 3 Exclusive Brand Outlets for Indya in late 2017.

Co-founder Tanvi Malik added “We plan to use the fresh capital infusion to expand geographically into the top metros and affluent Tier-1 cities. We plan to grow from 3 own-stores to 25 stores in the next 12 months and will be deploying 10-12 Crores towards the expansion. The aim is to grow our Indya brand both offline and online, while the FabAlley brand with its rapid fashion, global fashion strategy grows primarily online through horizontal and vertical category additions in the western wear apparel and accessories space.”

Speaking about the investment, Nilesh Kothari, Co-founder, Trifecta Capital, said “Online Fashion is growing at around 50% CAGR and is expected to be a US$ 20 Bn market by 2020. FabAlley stood out amongst the crowded, and yet the largest and fastest growing, e-commerce segment– Fashion,by being the most capital efficient player, and leveraging omni-channel to build a sizeable business. The combination of a proprietary tech platform enabling just-in-time inventory fulfilment, agility in introduction of new designs, and a vertically integrated supply chain resulting in affordable products, has allowed them to solve the biggest challenge faced by the segment – ever evolving fashion trends and inventory risk. We look forward to supporting them through their exciting journey.”

FabAlley is on track to clock Rs 100 Crore in Gross Merchandise Value in FY18, exhibiting a 100% growth over the previous Financial Year. The company has turned EBITDA positive in the last 3 quarters in FY18 and is expected to sustain an EBITDA positive rate of over 5% in the next 12 months even as it continues to grow.

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