Accel, a key investor in Indian e-commerce giants Flipkart and Myntra, is gearing up for a new venture in the Indian fashion e-commerce landscape amidst heightened competition from Mukesh Ambani’s Ajio platform.
Key Takeaway
Accel, a prominent investor in Indian e-commerce, is considering a substantial investment in Newme, an emerging fast-fashion e-commerce player in India. This move underscores the escalating competition in the Indian fashion e-commerce landscape, with established players facing challenges from both domestic startups and global partnerships.
Accel’s Potential Investment in Newme
Accel is reportedly in advanced discussions to lead a funding round of $15-20 million into Newme, an Indian fast-fashion e-commerce startup. This move comes shortly after Newme’s announcement of securing $5.4 million in seed funding led by Fireside Ventures. If the funding goes through, Newme could be valued at around $83-85 million post-money, positioning it as the “Shein for India” according to some supporters.
About Newme
Newme, often likened to “Shein for India,” specializes in its own rapidly-changing clothing lines available online and through offline channels. The startup, established in 2022, targets India’s Gen Z consumers with an average order value ranging between $18-30. It prides itself on serving 350,000 customers and introducing 500 new designs weekly, all at an average price point of $10.
Accel’s Interest and Previous Backing
Accel’s interest in Newme follows its prior support for Virgio, another Indian online fashion retailer that later underwent a pivot.
Competition in the Fast-fashion E-commerce Space
The fast-fashion e-commerce sector in India has been witnessing significant growth, with local startups drawing inspiration from global fast-fashion leaders such as Zara, H&M, and Uniqlo. While Flipkart remains a dominant player in this category, it faces increasing competition from Ambani’s Ajio, which has secured approximately 30% market share, as per research firm Bernstein. Additionally, e-commerce rival Amazon is also making strides to strengthen its fast-fashion operations, as indicated by recent job postings.
Shein’s Comeback
Shein, previously banned in India, is poised for a return through a joint venture with Reliance, as announced by the two companies last year.
Accel and Newme have not yet responded to requests for comments.
