Accel, known for its early investments in Indian e-commerce giants like Flipkart and Myntra, is gearing up for a new venture in the Indian fashion e-commerce landscape despite heightened competition from Mukesh Ambani’s Ajio platform.
Investment Plans with Newme
Accel is reportedly in advanced discussions to lead a funding round of $15 million to $20 million into Newme, an Indian fast-fashion e-commerce startup. This potential investment aims to value Newme, often dubbed “Shein for India” by some backers, at approximately $83 million to $85 million post-money.
Newme’s Business Model and Growth
Newme distinguishes itself by offering rapidly changing clothing lines both online and through offline channels, catering to India’s Gen Z consumers. With average order values ranging between $18 and $30, the startup, founded in 2022, boasts serving 350,000 customers and introducing 500 new designs weekly at an average price point of $10.
Accel’s Interest and Past Ventures
Accel’s interest in Newme follows its prior backing of Virgio, another Indian online fashion retailer that underwent a strategic pivot. As the fast-fashion e-commerce sector gains traction in India, fueled by global inspirations from brands like Zara, H&M, and Uniqlo, Accel aims to leverage Newme’s potential in this evolving market.
Competitive Landscape and Market Dynamics
While Flipkart remains a dominant player in the fast-fashion category, it faces increasing competition from Ambani’s Ajio platform, which has secured approximately 30% market share, as reported by research firm Bernstein. Additionally, e-commerce behemoth Amazon is also ramping up its fast-fashion endeavors, evident from recent job postings.
Shein’s Comeback and Industry Dynamics
The anticipated return of Shein in India, through a joint venture with Reliance, adds further complexity to the competitive landscape. Despite regulatory challenges and market dynamics, Accel’s strategic move with Newme underscores its commitment to exploring new opportunities in India’s dynamic fashion e-commerce sector.
Accel and Newme were unavailable for immediate comment regarding these developments.
