Velocity, a revenue-based financing platform, has laid off 14 per cent of its workforce affecting 22 employees. As per an offcial post by company on Friday, the layoffs have affected employees in various departments.
The company’s current objective is to reportedly achieve profitability and the restructuring comes as a step towards achieving the same. The move is aimed at minimising any duplication of roles, simplifying and automating critical aspects of its processes, resulting in substantial increase in efficiency.
The platform which has Valar Ventures as a major investor has extended a severance package to the affected employees, equivalent to two months’ salary.
Furthermore, the layoffs are said to be the company’s measure to reduce costs and extend the startup’s financial runway.
Established in 2020 by its founders Abhiroop Medhekar, Atul Khichariya and Saurav Swaroop, Velocity specialises in providing revenue-based financing solutions to Indian direct-to-consumer (D2C) and e-commerce platforms. Additionally, the startup extends credit card and payment solutions to these businesses.
In FY22, Velocity recorded a standalone net loss of INR 7.9 crore, marking a significant increase of 32 times compared to INR 24 lakh in FY21. Meanwhile, the total revenue surged 2.3 times to INR 5 crore from INR 2.2 crore in FY21.
The company is said to have executed over 1,500 deals to date. Furthermore, the startup has financed startups such as Off Duty, Sujatra, and The Ayurveda Co. in the apparel and fashion sectors this year.