Voonik, a personal shopping app for women, just announced its Series A investment from Sequoia and Seedfund. Sujayath Ali, CEO & Co-founder of Voonik, shares his story.
As a boy, I had grown used to my dad commenting on my dress sense, or lack thereof. And after I got married, my wife picked up where he left off.
I thought luxury brands and paying more for clothes would be the key to my external transformation but that strategy didn’t seem to help. That’s when I asked myself, “If I don’t need to be a geek to buy a laptop, then why should I know about fashion to buy clothing?”
This was 2013 when a shaky economy and uncertain business outlook made it a less than ideal time to turn entrepreneurial. But that’s when my cofounder Navaneeth and I launched our company, Voonik. The NextBigWhat article about our launch said:
“With fire sales and all the negativity around e-commerce in India, this may not be the best time to start a new online commerce site. But then, the startup world never fails to surprise.”
Navaneeth and I went to college together and have known each other for 15 years. Navaneeth was not new to the startup scene, having been a garage stage engineer at companies such as Zoho, Freshdesk and Aryaka. I was in the US and had spent seven years at Amazon and a year at Visa as a product guy. We first discussed the idea of starting something together over a Facebook chat session. Navaneeth had an idea for a Saas offering based on his experience at Zoho and Freshdesk. I pitched my idea of creating a new way of shopping that enables users to buy what suits their build, lifestyle, and budget. He was convinced. I returned to India in 2013 and Navaneeth quit Freshdesk to jump into our venture.
The first few months were pretty uneventful. We put together a small team and launched a MVP version of the product. I remember the early days with no customers and sales. I will admit it was a daunting period and there was a point when we contemplated pivoting to his Saas idea. But our core belief in this idea was what kept us going. Slowly, traffic built up and sales started happening.
I remember a meeting with Mukesh Bansal, CEO of Myntra, around October 2013. He liked what we are building and mentioned that Myntra would look like Voonik in two years. That meeting boosted our confidence and kept us going. Sure enough, after two years, we are now seeing Myntra moving from a price and selection value prop to a personalization value prop with its app-only move. Mukesh did invest a small amount in Voonik and remains a mentor.
The first big break came in the form of a TV program, ‘The Pitch’, organized by Bloomberg TV. We participated and eventually ended up winning the show. There were many other more seasoned entrepreneurs who participated in the show and we are still not sure how and why we won. In fact, I was eliminated in one of the rounds and later got in as a wild card entry. The winner was eligible to receive seed money from Seedfund. We got 2.5 crores through this route in exchange for 30% of the company.
Following this boost to our morale and finances, we started building the full version of the product and the personal shopping platform. After studying the numbers from the MVP period, we decided to focus on women as our primary target segment. That was the first of the three important decisions we made that ultimately contributed to the success of our venture.
Soon after this, we got an invite from Microsoft Ventures. Given that this was a no-equity program, the decision to participate was easy. In Feb 2014, a week after starting our Microsoft Ventures program, we launched our full version website powered by our own personal shopping platform. We were buoyed and ready for the ride ahead but the initial parts of this were not as smooth as we anticipated.
We had to weather a rough six month period when we would grow one month and retract the next. Thankfully, Bharati Jacob, our board member from Seedfund was patient and allowed us time to figure things out. We had grown by 150% in these six months, but we did not think it was significant given the low base. Bharati believed in our value prop and pushed a second tranche of funds through for us. She counseled us to focus on retention rather than conversion or growth. This turned out to be very sound advice that helped us make the second most important business decision in our journey.
The next turning point was in August 2014, when we launched our Android mobile app. Within weeks of the launch, we realized that it would be difficult to compete as a fashion website given the incumbents in the space but we also realized that the app market in the fashion space was wide open. So we diverted our efforts to building this. That was the third and the most important decision after which there was no looking back.
Before the launch of our app, we had talked to two to three VC firms who liked our idea but sought evidence of more traction. As we launched our app, we started getting inbound calls from various analysts of VC firms. We made sure that we gave them our time and as a result we got through to decision makers in all the leading VC firms. Our talks with various VCs were in different stages when we met Sequoia.
We met Sequoia at NextBigWhat’s mobile conference (bigMobilityConf)* in late 2014. An introduction through this channel led to a 30 minute meeting with Shailendra Singh who was very positive about what we were building at Voonik. He was probably the person who was most bullish about the idea, after Navaneeth and me.
We then presented to the Sequoia board and listened to some concerns that they expressed during this time. These were issues that we also wanted to address and we spent the next few weeks tackling these. Between Sequoia and Seedfund, we raised 34 Crores as part of Series A.
Sequoia moved quickly to close things with a simple and standard term sheet. They wired the first tranche within weeks with minimal due diligence. The second tranche came in less than a month after that.
I am proud to say that today Voonik is the highest rated fashion app in India. We now have more than 1.3 million downloads and were the second most downloaded fashion app in April and May, next only to Myntra. We are looking forward to reaching a $100 million GMV run rate in the next year. We have reached this stage in our journey because of our persistence, a few important business decisions and some very timely funding support.
* Founders : Go ahead and block your seat for the upcoming conference, UnPluggd. At NextBigWhat, we always strive to focus on meaningful conversations and connections (sans noise).