Jewellery start-up funding has skyrocketed nearly 9x in the last five years, with investors backing brands offering personalised solutions for today’s savvy consumers. The new wave is disrupting a market, traditionally dominated by legacy players and touching off a pan-industry scramble for online sales.
A decade ago, when e-commerce platforms began offering basic vanity products online, fashion tech companies started foraying into the online space, making major inroads across all segments, barring one. For long, the jewellery business remained a defiant bastion of traditional old offline merchants.
All that, however, is history. Today, a fast-evolving jewellery market is gleefully embracing online shopping, toeing the line of shoes, clothes and what have you with gusto. Result: Jewellery techpreneurs have emerged as the new favourites among funders, driving a lightning fast surge in investments.
According to data firm Tracxn, start-ups in this space attracted $136 million in 16 rounds of funding in 2024. It was by far the highest ever, crowning a 9x growth from the $15 million raised in 2020 with a glittering 24 per cent growth over 2023, which brought in $109 million.
‘Consumer is King’
Put briefly, today’s fashion-conscious shoppers, looking for trendy, crush-worthy designs, are taking to online jewellery stores with a never before relish, reflecting a fast evolving marketplace. The seismic shift in market preference has created a huge opportunity for both start-ups and their investors for exponential innovation-led growth that has seen them gain a competitive edge in a rapidly growing sector.
Angel investor and president at M Strategy Global Investment Group, Mandar Shrikant Joshi, who has invested in multiple fashion tech start-ups, affirms that 2024 has been an absolute gem. “This growth is led by an increase in consumers’ appetite, tech advancement, the rapid growth of e-commerce, and the evolution of traditional jewellery into a Gen Z-led niche. These factors are driving venture capital investments.”
The $85.5 billion jewellery market in India is projected to expand at a CAGR of six per cent over the next five years setting off a tidal wave that could sweep innovative start-ups through a period of multi-fold growth. Already, all around the jewellery landscape start-ups offering personalisation and affordable luxury are tapping into the younger millennials and Gen Z demographics, who are the major buyers of jewellery outside traditional offline stores.
Responding to the growing demand for unique and affordable jewellery, D2C brands have simplified personalisation through try-on technology, recommendation AI, and flexible return-exchange policies. Drawn by such innovations, the investor community is pouring in the money, betting big on start-ups to evolve with the market.
Start-ups have the advantage of capitalising on emerging trends and launching new collections faster than legacy players, which helps them stay ahead of the curve. They also enjoy lower overhead costs and benefit from direct-to-consumer models, making them more cost-effective.
Wave of Innovation
Dishi Somani, founder of Dishi S Jewellery, with sales across platforms states that emerging brands thrive by privatising innovation and customer centricity. "Unlike legacy firms start-ups are more agile adapting quickly to shifting trends like customisation, sustainability and direct-to-customer models. They excel at building strong brand identities and engaging directly with Gen Z and millennial markets through influencer marketing and social media, setting themselves apart from traditional heritage brands."
All industry stakeholders, including VCs and the big players have noticed the growth and evolution of the industry in the last few years, which has led to the rise in funding and mergers and acquisitions.
Players like GIVA, Bluestone, Ultrahuman and Jewelbox have been on a funding spree in 2024, going through more than one funding round, led by venture capitalists and angel investors. While big players like Senco, Vaibhav Jewellers and Motisons debuted on the stock exchange, there have been major M&As as well. Kalyan Jewellers acquired jewellery start-ups, Candere, Titan bought up CaratLane, Nykaa snapped up Pipa Bella and GOAT Brand Labs bagged Voylla.
Jeetu Bairathi partner at BDO India attributes this to the potential of the jewellery industry. He hints that larger players are noticing the impact smaller brands are creating in the market with their agility and innovative solutions. "Larger players will likely acquire smaller brands to leverage the technology, customer base and digital capabilities, creating stronger integrated players in the market, " he said.
Jeethu also highlighted the sector’s promising growth. Today, the unorganised jewellery market accounts for 65% compared to 80% five years ago, presenting greater opportunities for both offline and online players.
According to a report by Merisis Advisors, the shopping preferences of millennials and Gen Z are shifting online with only 25% preferring offline shopping compared to 44% of the older generations. The line between offline and online is blurring as online jewelleries sales significantly influence offline purchases.
Dishi Designer Jewellery, which sells across platforms, records 60% of its revenue from e-commerce platforms. Similarly, 80% of the revenue of Kicky and Perky, another jewellery start-up, comes from online sales. DiAi Designs which sells premium lab-grown diamonds, claims a 300% increase in e-commerce revenues this year.
After e-commerce, quick commerce has also entered the fray. While GIVA and similar companies are already selling on QC platforms, companies like Malabar enjoyed the festival season boom as well with gold and silver coins being among their top sellers. Zepto in partnership with Augmont 24k and Malabar Gold & Diamonds, recorded a 6x surge in gold coin and a 4x increase in silver coin sales this year. Swiggy Instamart reported a 500% surge in coins’ sales compared to last year, according to CEO Phani Kishan.
However, online adoption for high-value jewellery remains limited due to the need for trust, tactile experience and personalised service that offline stores provide. As a result, many online first-brands are expanding offline and introducing premium categories to increase Average Order Value (AOV)
Abhijeet Poddar, retail jewellery franchise owner, states that AOV for online jewellery is around Rs 2000 as compared to Rs 8000 to 10000 for offline, irrespective of seasons. "It is great that start-ups offer trendy options online and their target customers are buying them. But for weddings and other important occasions, offline remains the go-to-spot for the majority. An omnichannel strategy is the right approach."
Legacy players are actively adapting to this transformation. Major jewellers such as Kalyan, Bluestone, PC Jewellers, Tanishq and PN Gadgil, have started selling online through their own websites and other E-Commerce platforms.
According to Zeba Khan, Director of Amazon Fashion and Beauty, India, the ecommerce giant has seen an 84% spike in gold jewellery sales from brands like Malabar, PC Chandra and PN Gadgil. "Daily-wear 14K jewellery is growing at 2.5% year-on-year, while 18k jewellery is growing at 75% annually," she said.
The CEO of a prominent legacy jewellery brand added that despite the digital transformation, companies need both online and offline options to expand in this segment. "If you have omnichannel presence it's an easy conversion. To sell beyond a certain value customers need the touch and feel experience. Building an online presence for offline players is easy, the reverse is not. Start-ups must up their game."
Lisa Mukhedkar, CEO and Founder of jewellery start-up Aukera, which raised 3.18 million early this year, believes start-ups are less concerned with legacy brands. Jewellery start-ups are rushing to claim their stake in the market. Success depends on how well a brand wins customer trust long associated with family jewellers," she said.
With the jewellery industries transforming at an unprecedented pace the market appears large enough to accommodate both traditional players and innovative start-ups. Legacy brands are adopting digital strategies while start-ups leverage their agility to disrupt the space with personalisation sustainability and unique designs.
As the industry evolves, one thing remains clear, whether offline or online consumer preference and technology will shape the future of jewellery, offering untapped opportunities for both new and established players.