Velocity, a revenue-based financing platform, has laid off 14% of its employees, affecting 22 people. Employees in various departments have been laid off, according to an official post by the company on Friday.
The company’s current goal, according to reports, is to achieve profitability, and the restructuring is a step towards that goal. The move is intended to reduce role duplication while also simplifying and automating critical aspects of its processes, resulting in a significant increase in efficiency.
The platform, which counts Valar Ventures as a major investor, has offered affected employees a two-month severance package.
Furthermore, the layoffs are said to be a cost-cutting measure designed to extend the startup’s financial runway.
Velocity, founded in 2020 by Abhiroop Medhekar, Atul Khichariya, and Saurav Swaroop, specialises in revenue-based financing solutions for Indian direct-to-consumer (D2C) and e-commerce platforms. Furthermore, the startup provides credit card and payment solutions to these companies.
Velocity reported a standalone net loss of INR 7.9 crore in FY22, an increase of 32 times from INR 24 lakh in FY21. Meanwhile, total revenue increased 2.3 times to INR 5 crore in FY21 from INR 2.2 crore.
To date, the company is said to have completed over 1,500 transactions. This year, the startup has also funded startups in the apparel and fashion sectors such as Off Duty, Sujatra, and The Ayurveda Co.