StyleAdda.com To Raise More Funds, Plans To Launch Deep Discount Online Shop

Online, March 24, 2012 (Newswire.com) - StyleAdda.com, India's largest upcoming online shopping mall who is struggling to launch its online mall will raise more funds as its private equity investors have not paid the full committed investment. According to the company's management only 60% of the committed amount is received which stands close to US $16.5 million.

An email query sent to private equity investors resulted in following response "StyleAdda.com promised to partly fund the project, only US $1.9 million is invested by them so far against a commitment of US $7 million. We have stopped our payments until and unless the business execution becomes clear."

StyleAdda.com have appointed India's first online CEO to head its mega venture. Billie Starkey will be the new CEO of StyleAdda.com which will manage company's operation from the United States.

"Billie is a great leader who believes in inspiring others, it will be a pleasure to have him on board," said Sonam Kumari, CFO of StyleAdda.com. Billie carries a total of experience of 17 years in retailing industry.

StyleAdda.com is also working to revamp its business model, the new enterant may launch deep discount website in beta and will further develop the full fledged online mall. The deep discount model may hurt company negatively as it may have to suffer a net loss of US $1.7 million per month on the basis of projected sales. Under deep discount model a product may be sold for 50-60% of their original value, it may result in higher turnover but will negatively deteriorate bank balance.

StyleAdda.com will compete with flipkart, letsbuy, yebhi and other established players. According to the sources, it may partner Amazon's junglee.com to sell its acquired inventory.

"We have bought goods worth US $17 million so far, however no sale is made till date. We will be selling out our inventory at no profit or loss to recover and repay our investors," added Sonam.

StyleAdda.com will be listed on Exhilway Private Capital Market, the India's first pre-IPO market (somewhat similar to sharespost and secondmarket). StyleAdda.com will share space with another HR recruitment start up candydatejobs.com and few other leading companies.

StyleAdda.com which touched new highs of valuation when the project was announced will be moderately listed between US $200-250 million of valuation. StyleAdda.com currently employs 70 people and is considered to be the most expensive online shopping mall till date.

StyleAdda.com have to raise funds to acquire small online shopping malls to become large. The online retailing industry is already facing the heat of cut throat margins and extra customer service.

"The online retailing space is dangerous, you make a mistake and a single customer will kill your 100 customers with his review," said Flipkart's former employee.