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Lookiero closes $19M led by MMC Ventures to be the Stitch Fix for Europe
Lookiero, the online personal shopping service for clothes and accessories, has closed a $19 million funding round led by London-based VC MMC Ventures, with support from existing investor All Iron Ventures, and new investors Bonsai Partners, 10x and Santander Smart. The company will use the backing to expand in its main markets of Spain, France and the U.K. In June last year it closed a funding round of €4 million led by All Iron Ventures.
The startup applies algorithms to a database of personal stylists and customer profiles to thus provide a personalized online shopping experience to its customers. It then delivers a selection of five pieces of clothing or accessories curated by a personal shopper to fit the customer’s individual size, style and preferences. Customers then decide which items to keep or return (at no additional cost), allowing Lookiero to learn more about the customer’s taste before starting the whole process again.
By generating look-a-like profiles and analyzing previous customer interactions with each item, Lookiero says it can predict how likely a user is going to keep a certain item from a range of more than 150 European brands from a warehousing system that will ship more than 3 million items of clothing this year to seven European countries.
It’s not unlike the well-worn Birchbox model. Lookiero’s main competitor is Stitch Fix (U.S.), which has upwards of $1.5 billion in annual revenues and IPO’d in November 2017.
Founded in 2015 by Spanish entrepreneur Oier Urrutia, the company says it now has over 1 million registered users and has grown revenue by more than 200% from 2017 to 2018.
In a statement Urrutia said: “This investment round provides us with the necessary capital to further increase the accuracy of our technology, which is really exciting. It will allow us to offer the best possible experience for our users and to continue expanding across Europe.”
Simon Menashy, partner, MMC Ventures, said: “The migration of fashion brands online has improved consumers’ access to clothing, and there is now an almost overwhelming amount of choice. At the same time, it can still be really hard to find exactly what is right for you, especially with High Street retail stores in decline. Lookiero provides the best of both worlds, giving every customer a hand-picked selection from their personal stylist.”
Ander Michelena, co-founding partner of All Iron Ventures, said: “Even if what Oier and his team have achieved to date is remarkable, we believe that Lookiero still has great potential to continue expanding internationally and to become a player of reference in a market segment where there is still a lot to do in terms of innovation and user satisfaction.”
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‘The best VC on Instagram’ is now VC-backed
About 18 months ago, Jenny Gyllander created an Instagram account by the name of @thingtesting.
The premise was simple. Gyllander, who was at the center of the London startup ecosystem as an investor with the British seed fund Backed.VC, would upload photos of interesting direct-to-consumer products with a caption that served as a bite-sized review. The experiment began with Birchbox, a provider of curated boxes of beauty products that rose to prominence amid the subscription box hype of yesteryear. In her short review, tailored perfectly for the Instagram generation, Gyllander admitted to being “like 10 years late to this much hyped subscription-everything party,” adding that “after two boxes and ten products, only three products were relevant to me.” Her honesty, and perhaps more importantly, her brevity, garnered her a small following of venture capitalists, founders and consumer-brand enthusiasts.
Since that first post, Gyllander has featured and reviewed more than 100 products on her Instagram account — which today counts 32,800 followers. And she quit her day job and began building an Instagram-inspired, full-fledged review business.
“I found something I am very, very passionate about,” Gyllander tells TechCrunch. “Finding the D2C niche was for me a little bit of a Holy Grail. It’s where brands and startups align for the first time in a concrete way.”
With a $300,000 pre-seed investment from angel investor and Homebrew co-founder Hunter Walk, who previously called Thingtesting “The best VC on Instagram,” early Spotify investor Shakil Khan and more, Gyllander wants to create a full-scale D2C review platform with a team of reviewers and content creators, and a portal for her loyal followers to write and submit their own reviews. She compares what she envisions for Thingtesting to that of Rotten Tomatoes. Akin to the popular website for movie and television reviews, each product review on her future website will include a Thingtesting score and an audience score. The goal is to help consumers shop smarter and filter through the D2C noise.
“People are confused right now by the sheer amount of products launching,” Gyllander said. “I want Thingtesting to be a filter for people to consume better … It’s a role department stores used to have back in the day, but nobody has really filled that role in the online world.”
Gyllander, already making money from what was once a side project, has plans in store to generate significantly more revenue. Currently, she’s capitalizing off Instagram’s Close Friends list, which the social media hub launched last year to allow users to share content to fewer people. Gyllander, like a slew of other Instagram influencers, however, quickly realized an opportunity to monetize content using the feature, a trend explained in detail in a recent report from The Atlantic.
Gyllander charges a lifetime fee of $100 to her followers hoping for a spot on her Close Friends list. Those followers are then provided exclusive content, including behind-the-scenes looks at her product review journeys. So far, 300 people have been granted access to the exclusive group as others sit on the waitlist. Gyllander explains she hasn’t green-lit every request to enter the coveted group because she wants to maintain a sense of community as the account grows in popularity. Early next year, she hopes, she will have launched a Thingtesting website and a new subscription-based membership tier targeting D2C connoisseurs, investors and anyone interested in a front-seat view of the booming D2C industry.
As Thingtesting morphs into a digital review platform and expands from the bounds of Instagram, Gyllander will have to work harder to differentiate what she’s built from other review sites and D2C blogs. Her secret weapon, she believes, is her authenticity.
“It’s my honesty,” Gyllander said. “And it’s the fact that there’s no payment involved from the brands and that I’m not being paid to review products. That’s something quite rare in the Instagram world today. There aren’t that many accounts that are just talking about new products with non-monetary incentives.”
Since launching with a review of Birchbox, Gyllander has shared her thoughts on Magic Spoon, a D2C cereal company: “one bowl kept me full for hours,” she wrote, ultimately concluding she wouldn’t continue eating the cereal. More recently, she referred to the D2C aperitif brand Haus as “stunning;” wrote a lukewarm review of the blue light-protecting eyewear brand Felix Gray; and posted a glowing summary of Dripkit, a D2C coffee brand.
To secure a spot on Gyllander’s grid, a product must bring something new to the market, as well as boast killer branding and packaging. The former VC says she tries out about 20 products a month and shares official reviews of four or five.
“The majority of people today, when it comes to modern brands, they have their first interaction through an ad or an influencer telling them about the product,” Gyllander explained. “Discovery is in a weird place right now when it comes to the general consumer.”
It’s difficult to imagine a venture-scale business within Gyllander’s vision for Thingtesting. But one should never underestimate the value of an exclusive and hyper-focused network. Gyllander, in a short time, has created a meeting place for D2C aficionados and venture capitalists and, as she’s proven, her thoughts are worth paying for.
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ipsy launches its beauty product e-commerce business Shopper as hit hits 3M subscribers
ipsy, a subscription service that delivers a collection of products to its users every month, has spent the last six years building up a community with millions of people obsessed with beauty products. And now that the company has more than 3 million subscribers — with a $10 per month subscription cost — it’s ready to get a little bit more aggressive by getting directly… Read More
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