Bengaluru-based Slikk Club, which offers 60-minute delivery of lifestyle and fashion items, has raised $3.2 million in a seed funding round led by Lightspeed, along with participation from Multiply Ventures and other existing investors.
The fresh capital will be used to build more dark stores to be able to service about 80% of the city’s pincodes. At present, it has two dark stores to service a few pincodes in Bengaluru. Some funds will also be used to expand the team and hire for leadership roles across technology, category management, operations and supply chain.
“We aim to have 5-6 dark stores in a city like Bengaluru. These are large-format dark stores on expandable real estate, which are expandable anywhere between 10,000-20,000 sq ft. We keep increasing the real estate within the same property as the selection and categories grow,” said Akshay Gulati, CEO and co-founder of Slikk Club, told FE.
“We use machine learning to analyse and predict what is the consumption level per sq kilometre in a city. Then we try and put predictions around the population in terms of how much western wear or ethnic wear would they want to consume and then we plan our inventory accordingly,” he explained.
Till now, the app offered western wear from nearly 80 brands such as Snitch, The Souled Store, Freakins and Bewakoof, but it now intends to venture into categories such as ethnic wear, footwear, accessories and wearables, home decor, beauty and personal care. “We want to build on impulse purchases by value conscious customers, who want high design but also very economic pricing at the same time,” Gulati added.
The startup, which began operations last year, is growing 2x month-on-month, with majority of the business today coming from repeat users. It’s average order value is upwards of `2,000. “The kind of repeat and retention we’ve seen, I would say is almost seven to eight times higher than traditional marketplaces today,” Gulati said.
The app also offers quick returns and instant refund to its customers but Gulati said the percentage of returns are much lower than that of traditional marketplaces because of instant consumption. The average e-commerce return rate is around 20-30% on regular marketplaces.
While the venture is in its nascency, Gulati believes that it is easier to achieve profitability in quick commerce rather than traditional businesses. “In fashion, as a category with higher margins, availability and the kind of repeats we see, we actually feel that a cracking unit economics for a company like Slikk would be much easier,” he said.
Co-founded by Gulati, Om Prakash Swami (CTO) and Bipin Singh (CPO), the startup had raised $300,000 in September in its pre-seed round led by Better Capital. Some of the notable angel investors, including Tracxn co-founder Abhishek Goyal, Perpule co-founder Abhinav Pathak and Saurabh Gupta, managing partner at DST Global.
