e-commerce
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Saltbox raises $10.6M to help booming e-commerce stores store their goods
E-commerce is booming, but among the biggest challenges for entrepreneurs of online businesses are finding a place to store the items they are selling and dealing with the logistics of operating.
Tyler Scriven, Maxwell Bonnie and Paul D’Arrigo co-founded Saltbox in an effort to solve that problem.
The trio came up with a unique “co-warehousing” model that provides space for small businesses and e-commerce merchants to operate as well as store and ship goods, all under one roof. Beyond the physical offering, Saltbox offers integrated logistics services as well as amenities such as the rental of equipment and packing stations and access to items such as forklifts. There are no leases and tenants have the flexibility to scale up or down based on their needs.
“We’re in that sweet spot between co-working and raw warehouse space,” said CEO Scriven, a former Palantir executive and Techstars managing director.
Saltbox opened its first facility — a 27,000-square-foot location — in its home base of Atlanta in late 2019, filling it within two months. It recently opened its second facility, a 66,000-square-foot location, in the Dallas-Fort Worth area that is currently about 40% occupied. The company plans to end 2021 with eight locations, in particular eyeing the Denver, Seattle and Los Angeles markets. Saltbox has locations slated to come online as large as 110,000 square feet, according to Scriven.
The startup was founded on the premise that the need for “co-warehousing and SMB-centric logistics enablement solutions” has become a major problem for many new businesses that rely on online retail platforms to sell their goods, noted Scriven. Many of those companies are limited to self-storage and mini-warehouse facilities for storing their inventory, which can be expensive and inconvenient.
Scriven personally met with challenges when starting his own e-commerce business, True Glory Brands, a retailer of multicultural hair and beauty products.
“We became aware of the lack of physical workspace for SMBs engaged in commerce,” Scriven told TechCrunch. “If you are in the market looking for 10,000 square feet of industrial warehouse space, you are effectively pushed to the fringes of the real estate ecosystem and then the entrepreneurial ecosystem at large. This is costing companies in significant but untold ways.”
Now, Saltbox has completed a $10.6 million Series A round of financing led by Palo Alto-based Playground Global that included participation from XYZ Venture Capital and proptech-focused Wilshire Lane Partners in addition to existing backers Village Global and MetaProp. The company plans to use its new capital primarily to expand into new markets.
The company’s customers are typically SMB e-commerce merchants “generating anywhere from $50,000 to $10 million a year in revenue,” according to Scriven.
He emphasizes that the company’s value prop is “quite different” from a traditional flex office/co-working space.
“Our members are reliant upon us to support critical workflows,” Scriven said.
Besides e-commerce occupants, many service-based businesses are users of Saltbox’s offering, he said, such as those providing janitorial services or that need space for physical equipment. The company offers all-inclusive pricing models that include access to loading docks and a photography studio, for example, in addition to utilities and Wi-Fi.
Image Credits: Saltbox
Image Credits: Saltbox
The company secures its properties with a mix of buying and leasing by partnering with institutional real estate investors.
“These partners are acquiring assets and in most cases, are funding the entirety of capital improvements by entering into management or revenue share agreements to operate those properties,” Scriven said. He said the model is intentionally different from that of “notable flex space operators.”
“We have obviously followed those stories very closely and done our best to learn from their experiences,” he added.
Investor Adam Demuyakor, co-founder and managing partner of Wilshire Lane Partners, said his firm was impressed with the company’s ability to “structure excellent real estate deals” to help them continue to expand nationally.
He also believes Saltbox is “extremely well-positioned to help power and enable the next generation of great direct to consumer brands.”
Playground Global General Partner Laurie Yoler said the startup provides a “purpose-built alternative” for small businesses that have been fulfilling orders out of garages and self-storage units.
Saltbox recently hired Zubin Canteenwalla to serve as its chief operating officer. He joined Saltbox from Industrious, an operator co-working spaces, where he was SVP of Real Estate. Prior to Industrious, he was EVP of Operations at Common, a flexible residential living brand, where he led the property management and community engagement teams.
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Stockly lets e-commerce websites sell out-of-stock items from a shared inventory
Meet Stockly, a French startup that keeps the inventory of various e-commerce websites in sync. When you see an out-of-stock item on an e-commerce website, chances are you leave that website and try to find the same item on another site.
If you operate an e-commerce website, Stockly lets you sell items even when they’re currently out of stock. The startup automatically finds a third-party Stockly supplier with that specific item.
The order will go through and be sent by that supplier directly. Stockly tells its partners to use neutral packaging so that the end consumer isn’t confused.
This could be particularly useful for small-scale e-commerce companies that don’t have a healthy marketplace of third-party retailers. For instance, Amazon can already sell you an out-of-stock item if a supplier has listed that specific item on Amazon’s own marketplace. But that’s not the case for most e-commerce websites.
The main challenge for Stockly is that it has to sort through various catalog formats and match the different inventories of different retailers. It is focusing on clothing items at first. When an order is routed through Stockly, it selects a specific supplier based on different criteria, such as logistics, delivery time and historical data.
So far, Stockly has been working with Galeries Lafayette, Go Sport, Foot Shop and others. The startup has recently raised a $6 million (€5.1 million) funding round from Idinvest Partners, Daphni, Techstars, Checkout.com CEO Guillaume Pousaz and various business angels.
With this funding round, the company plans to expand its team to 20 people, add new clients and iterate on its product.
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Argentina’s Digital House raises over $50M to help solve LatAm’s tech talent shortage
Digital House, a Buenos Aires-based edtech focused on developing tech talent through immersive remote courses, announced today it has raised more than $50 million in new funding.
Notably, two of the main investors are not venture capital firms but instead are two large tech companies: Latin American e-commerce giant Mercado Libre and San Francisco-based software developer Globant. Riverwood Capital, a Menlo Park-based private equity firm, and existing backer early-stage Latin American venture firm Kaszek also participated in the financing.
The raise brings Digital House’s total funding raised to more than $80 million since its 2016 inception. The Rise Fund led a $20 million Series B for Digital House in December 2017, marking the San Francisco-based firm’s investment in Latin America.
Nelson Duboscq, CEO and co-founder of Digital House, said that accelerating demand for tech talent in Latin America has fueled demand for the startup’s online courses. Since it first launched its classes in March 2016, the company has seen a 118% CAGR in revenues and a 145% CAGR in students. The 350-person company expects “and is on track” to be profitable this year, according to Duboscq.
Digital House CEO and co-founder Nelson Duboscq. Image Credits: Digital House
In 2020, 28,000 students across Latin America used its platform. The company projects that more than 43,000 will take courses via its platform in 2021. Fifty percent of its business comes out of Brazil, 30% from Argentina and the remaining 20% in the rest of Latin America.
Specifically, Digital House offers courses aimed at teaching “the most in-demand digital skills” to people who either want to work in the digital industry or for companies that need to train their employees on digital skills. Emphasizing practice, Digital House offers courses — that range from six months to two years — teaching skills such as web and mobile development, data analytics, user experience design, digital marketing and product development.
The courses are fully accessible online and combine live online classes led by in-house professors, with content delivered through Digital House’s platform via videos, quizzes and exercises “that can be consumed at any time.”
Digital House also links its graduates to company jobs, claiming an employability rate of over 95%.
Looking ahead, Digital House says it will use its new capital toward continuing to evolve its digital training platforms, as well as launching a two-year tech training program — dubbed the the “Certified Tech Developer” initiative — jointly designed with Mercado Libre and Globant. The program aims to train thousands of students through full-time two-year courses and connect them with tech companies globally.
Specifically, the company says it will also continue to expand its portfolio of careers beyond software development and include specialization in e-commerce, digital marketing, data science and cybersecurity. Digital House also plans to expand its partnerships with technology employers and companies in Brazil and the rest of Latin America. It also is planning some “strategic M&A,” according to Duboscq.
Francisco Alvarez-Demalde, co-founder & co-managing partner of Riverwood Capital, noted that his firm has observed an accelerating digitization of the economy across all sectors in Latin America, which naturally creates demand for tech-savvy talent. (Riverwood has an office in São Paulo).
For example, in addition to web developers, there’s been increased demand for data scientists, digital marketing and cybersecurity specialists.
“In Brazil alone, over 70,000 new IT professionals are needed each year and only about 45,000 are trained annually,” Alvarez-Demalde said. “As a result of such a talent crunch, salaries for IT professionals in the region increased 20% to 30% last year. In this context, Digital House has a large opportunity ahead of them and is positioned strategically as the gatekeeper of new digital talent in Latin America, preparing workers for the jobs of the future.”
André Chaves, senior VP of Strategy at Mercado Libre, said the company saw in Digital House a track record of “understanding closely” what Mercado Libre and other tech companies need.
“They move as fast as we do and adapt quickly to what the job market needs,” he said. “A very important asset for us is their presence and understanding of Latin America, its risks and entrepreneurial environment. Global players have succeeded for many years in our region. But things are shifting gradually, and local knowledge of risks and opportunities can make a great difference.”
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Saleor scores $2.5M seed round for its ‘headless’ e-commerce platform
Saleor, a Poland and U.S.-based startup that offers a “headless” e-commerce platform to make it easier for developers to build better online shopping experiences, has raised $2.5 million in seed funding.
The round is led by Berlin’s Cherry Ventures, with participation from various angels. They include Guillermo Rauch (Vercel CEO and inventor of Next.js), Chris Schagen (former CMO of Contentful) and Kevin Mahaffey (co-founder of Lookout).
Saleor says the injection of capital will be invested in further developing Saleor‘s headless e-commerce platform, including a soon-to-launch cloud product and GraphQL API for front-end engineers.
Founded in 2020 but with a history going back to 2013, years before founders Mirek Mencel and Patryk Zawadzki spun out the product separate from their agency, Saleor is described as an “API-first” e-commerce platform that takes a “headless” approach. The idea is that the platform does the back-end heavy lifting so that developers can focus on the front end where most of the value is created for users.
“Saleor was born of necessity when our agency work at Mirumee Software required more modular, flexible and scalable e-commerce software,” Saleor co-founder Mirek Mencel recalls. “Most solutions for bigger brands came with proprietary baggage like vendor lock-in, slow adoption of new technologies and commercial certification programs. On the open-source side, we didn’t enjoy Magento’s developer experience and felt alternatives weren’t viable at scale”.
And so Saleor was conceived as an open-source platform focused on “technical excellence and quality” that could deliver greater scalability and extensibility than existing proprietary software. By 2016, the product had grown from something Mencel and Zawadzki’s agency used internally into a platform used by developers around the world.
“We could have stopped there, but saw brands pressing for more revolutionary front-end experiences,” Mencel says. “Decoupling Saleor’s core from its presentation layer was the obvious path to revolutionary front-ends. As difficult as it was, we tore down what was a rather good open-source e-commerce platform and rebuilt it API-first”.
Beyond their early headless conviction, the pair also came to the realisation that GraphQL delivered “more power, precision and developer happiness” than REST. Reasoning that most developers prefer “a few things done superbly to many things done well,” they committed exclusively to Saleor’s GraphQL API. “We have never looked back,” says Mencel.
In 2018, the original six-person team shipped Saleor 2.0. Now with a headcount of 20, Mencel says Saleor has a simple vision of developer-first commerce: open-source, GraphQL and “fair-priced” cloud — a vision that Cherry Ventures has clearly bought into.
“We are currently witnessing a paradigm shift with developers switching to headless commerce solutions, allowing more flexible, differentiated shopping experiences,” says Filip Dames, founding partner of Cherry. “Mirek, Patryk, and their team are at the forefront of this development and will enable innovative merchants to build state-of-the-art shopping experiences that scale across all consumer touch points and devices”.
“We decided to pursue venture backing as a way to increase the Saleor core team size and accelerate buildout of Saleor Cloud, which we’ll launch this year,” adds Mencel.
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Squarespace raises $300M at a staggering $10B valuation
Squarespace has raised $300 million in a round of funding that values the company at a staggering $10 billion valuation.
New backers include Dragoneer, Tiger Global, D1 Capital Partners, Fidelity Management & Research Company, funds and accounts advised by T. Rowe Price Associates, Inc. and Spruce House. Existing backers Accel and General Atlantic also participated.
Squarespace founder & CEO Anthony Casalena said the fresh capital will advance the company’s growth initiatives and help it scale its product suite.
The move comes less than two months after the company filed confidentiality to go public via a direct listing or initial public offering.
Squarespace, which has helped millions create their own websites, was founded in 2003 and bootstrapped until a $38.5 million Series A in 2010 that was co-led by Accel and Index Ventures.
The online website creation and hosting service — which has now expanded into e-commerce by hosting online stores — then raised another $40 million round in 2014. But it is perhaps best known for its epic 2017-era $200 million secondary round that General Atlantic financed. That round was raised at a $1.5 billion pre-money valuation. That means it has effectively upped its valuation by more than five times in just over three years.
At that time, TechCrunch reported that Squarespace was a profitable company, with revenues increasing 50% in the prior year, to about $300 million. Execs are declining to comment on the company’s latest funding round beyond a post on its website.
New York City-based Squarespace has over 1,200 employees spread across its headquarters and offices in Dublin, Ireland; Portland, Oregon; and Los Angeles, California.
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Noogata raises $12M seed round for its no-code enterprise AI platform
Noogata, a startup that offers a no-code AI solution for enterprises, today announced that it has raised a $12 million seed round led by Team8, with participation from Skylake Capital. The company, which was founded in 2019 and counts Colgate and PepsiCo among its customers, currently focuses on e-commerce, retail and financial services, but it notes that it will use the new funding to power its product development and expand into new industries.
The company’s platform offers a collection of what are essentially pre-built AI building blocks that enterprises can then connect to third-party tools like their data warehouse, Salesforce, Stripe and other data sources. An e-commerce retailer could use this to optimize its pricing, for example, thanks to recommendations from the Noogata platform, while a brick-and-mortar retailer could use it to plan which assortment to allocate to a given location.
Image Credits: Noogata
“We believe data teams are at the epicenter of digital transformation and that to drive impact, they need to be able to unlock the value of data. They need access to relevant, continuous and explainable insights and predictions that are reliable and up-to-date,” said Noogata co-founder and CEO Assaf Egozi. “Noogata unlocks the value of data by providing contextual, business-focused blocks that integrate seamlessly into enterprise data environments to generate actionable insights, predictions and recommendations. This empowers users to go far beyond traditional business intelligence by leveraging AI in their self-serve analytics as well as in their data solutions.”
Image Credits: Noogata
We’ve obviously seen a plethora of startups in this space lately. The proliferation of data — and the advent of data warehousing — means that most businesses now have the fuel to create machine learning-based predictions. What’s often lacking, though, is the talent. There’s still a shortage of data scientists and developers who can build these models from scratch, so it’s no surprise that we’re seeing more startups that are creating no-code/low-code services in this space. The well-funded Abacus.ai, for example, targets about the same market as Noogata.
“Noogata is perfectly positioned to address the significant market need for a best-in-class, no-code data analytics platform to drive decision-making,” writes Team8 managing partner Yuval Shachar. “The innovative platform replaces the need for internal build, which is complex and costly, or the use of out-of-the-box vendor solutions which are limited. The company’s ability to unlock the value of data through AI is a game-changer. Add to that a stellar founding team, and there is no doubt in my mind that Noogata will be enormously successful.”
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Spain’s Wallapop raises $191M at an $840M valuation for its classifieds marketplace
Through all of the last year’s lockdowns, venue closures and other social distancing measures that governments have enacted and people have followed to slow the spread of COVID-19, shopping — and specifically e-commerce — has remained a consistent and hugely important service. It’s not just something that we had to do; it’s been an important lifeline for many of us at a time when so little else has felt normal. Today, one of the startups that saw a big lift in its service as a result of that trend is announcing a major fundraise to fuel its growth.
Wallapop, a virtual marketplace based out of Barcelona, Spain that lets people resell their used items, or sell items like crafts that they make themselves, has raised €157 million ($191 million at current rates), money that it will use to continue growing the infrastructure that underpins its service, so that it can expand the number of people that use it.
Wallapop has confirmed that the funding is coming at a valuation of €690 million ($840 million) — a significant jump on the $570 million valuations sources close to the company gave us in 2016.
The funding is being led by Korelya Capital, a French VC fund backed by Korea’s Naver, with Accel, Insight Partners, 14W, GP Bullhound and Northzone — all previous backers of Wallapop — also participating.
The company currently has 15 million users — about half of Spain’s internet population, CEO Rob Cassedy pointed out to us in an interview earlier today, and has maintained a decent No. 4 ranking among Spain’s shopping apps, according to figures from App Annie.
The startup has also recently been building out shipping services, called Envios, to help people get the items they are selling to the buyers, which has expanded the range from local sales to those that can be made across the country. About 20% of goods go through Envios now, Cassedy said, and the plan is to continue doubling down on that and related services.
Naver itself is a strong player in e-commerce and apps — it’s the company behind Asian messaging giant Line, among other digital properties — and so this is in part a strategic investment. Wallapop will be leaning on Naver and its technology in its own R&D, and on Naver’s side it will give the company a foothold in the European market at a time when it has been sharpening its strategy in e-commerce.
The funding is an interesting turn for a company that has seen some notable fits and starts. Founded in 2013 in Spain, it quickly shot to the top of the charts in a market that has traditionally been slow to embrace e-commerce over more traditional brick-and-mortar retail.
By 2016, Wallapop was merging with a rival, LetGo, as part of a bigger strategy to crack the U.S. market (with more capital in tow).
But by 2018, that plan was quietly shelved, with Wallapop quietly selling its stake in the LetGo venture for $189 million. (LetGo raised $500 million more on its own around that time, but its fate was not to remain independent: it was eventually acquired by yet another competitor in the virtual classifieds space, OfferUp, in 2020, for an undisclosed sum.)
Wallapop has for the last two years focused mainly on growing in Spain rather than running after business further afield, and rather than growing the range of goods that it might sell on its platform — it doesn’t sell food, nor work with retailers in an Amazon-style marketplace play, nor does it have plans to do anything like move into video or selling other kinds of digital services — it has honed in specifically on trying to improve the experience that it does offer to users.
“I spent 12 years at eBay and saw the transition it made to new goods from used goods,” said Cassedy. “Let’s just say it wasn’t the direction I thought we should take for Wallapop. We are laser-focused on unique goods, with the vast majority of that secondhand with some artisan products. It is very different from big box.”
Wallapop’s growth in the past year is the result of some specific trends in the market that were in part fuelled by the COVID-19 pandemic.
People spending more time in their homes have been focused on clearing out space and getting rid of things. Others are keen to buy new items now that they are spending more time at home, but want to spend less on them. In both cases, there has been a push for more sustainability, with people putting less waste into the world by recycling and upcycling goods instead.
At the same time, Facebook hasn’t really made big inroads in the country with its Marketplace, and Amazon has also not appeared as a threat to Wallapop, Cassedy noted.
All of these have had a huge impact on Wallapop’s business, but it wasn’t always this way. Cassedy said that the first lockdown in Spain saw business plummet, as people were restricted to leave their homes.
“It was a roller coaster for us,” he said. “We entered the year with incredible momentum, very strong.”
He noted that the drop started in March, when “not only did it become not okay to leave the house and trade locally but the post office stopped delivering parcels. Our business went off a cliff in March and April.”
Then when the restrictions were lifted in May, things started to bounce back more than ever before, nearly overnight, he said. “The economic uncertainty caused people to seek out more value, better deals, spending less money, and yes they were clearing out closets. We saw numbers bounce back 40-50% growth year-on-year in June.”
The big question was whether that growth was a blip or there to say. He said it has continued into 2021 so far. “It’s a validation of what we see as long-term trends driving the business.”
“The global demand for C2C and resale platforms is growing with renewed commitment in sustainable consumption, especially by younger millennials and Gen Z,” noted Seong-sook Han, CEO of Naver Corp., in a statement. “We agree with Wallapop’s philosophy of conscious consumption and are enthused to support their growth with our technology and develop international synergies.”
“Our economies are switching towards a more sustainable development model; after investing in Vestiaire Collective last year, wallapop is Korelya’s second investment in the circular economy, while COVID-19 is only strengthening that trend. It is Korelya’s mission to back tomorrow’s European tech champions and we believe that NAVER has a proven tech and product edge that will help the company reinforce its leading position in Europe,” added Fleur Pellerin, CEO of Korelya Capital.
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BigCommerce customers can now sell on Walmart’s online marketplace
BigCommerce has partnered with Walmart to allow its customers to sell on the Bentonville, Arkansas-based retailer’s e-commerce marketplace, it announced this morning. Shares of Austin-based BigCommerce rose sharply in pre-market trading after the news, gaining around 10% before the bell.
Walmart, best-known for in-person shopping, has proven an e-commerce success story in recent years. For example, in its most recent quarter while Walmart as a whole grew 7.3%, its e-commerce sales advanced 69%.
BigCommerce has also reported strong growth in recent quarters, supported in part by partnerships similar to the one that it announced today. The e-commerce SaaS provider rolled out an integration with Wish last year, for example.
In a call concerning its earnings, which were announced before the Walmart news was announced, BigCommerce CEO Brent Bellm told TechCrunch that his company had been impressed with customer uptake of the Wish integration. Regarding the Walmart partnership, in a second interview Bellm told TechCrunch that it was overdue on the BigCommerce side; given the historical success of the Wish deal, it will be curious to dig into how many of the e-commerce platform’s customers opt to sell on Walmart, and how quickly they do so.
TechCrunch also spoke with Walmart exec Jeff Clementz about the arrangement. He stressed Walmart’s online customer monthly-actives — 120 million, per his company — and the breadth of their demand; BigCommerce customers selling on Walmart could expand its product diversity, helping the traditionally physical retailer possible continue its rapid growth.
The two companies are incentivizing adoption of the deal amongst BigCommerce customers by waiving certain fees for a month for retailers that sign up to sell on Walmart; Clementz described it as the first time that his company had offered a “new-seller discount.”
TechCrunch has had its eye on BigCommerce for some quarters now, thanks in part to its 2020 IPO. But the company is also interesting as its regular earnings results provide a lens into the world of e-commerce growth amongst independent digital retailers. Shopify, a chief BigCommerce rival, provides a similar view into the e-commerce world.
Shopify previously integrated with Walmart in the middle of 2020.
Looking ahead, it will be interesting to see if the Walmart partnership helps BigCommerce continue its improving revenue growth. The company is in a market share race with Shopify. But while BigCommerce’s rival has posted impressive growth from its integrated solutions, like its payments service, the Austin-based company stresses what it calls a more open model. Shopify charges many customers a percentage of their transaction volume for using a third-party payment solution over its own, for example, which Bellm described as a “tax” during an interview.
“Merchant Solutions” revenue at Shopify, which it generates “principally” from “payment processing fees from Shopify Payments,” grew 116% in 2020 to a little over $2 billion.
So with BigCommerce collecting a partnership with Walmart to match Shopify’s own, we’re seeing not merely two e-commerce platforms go toe-to-toe on providing their customers with as much market access as they can, but two different business philosophies compete. Akin to Microsoft Teams and Slack, it’s a competition to spectate.
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Valoreo closes on $50M to roll up LatAm e-commerce brands
A new breed of startups is acquiring and growing small but promising third-party merchants, and building out their own economies of scale.
And while there are a number of such startups based in the U.S. and Europe, none had emerged in the Latin American market. Until now.
Valoreo, a Mexico City-based acquirer of e-commerce businesses, announced Tuesday that it has raised $50 million of equity and debt financing in a seed funding round.
The dollar amount is large for a seed round by any standards, but most certainly ranks among the highest ever raised by a Latin American startup — further evidence of increased investor interest in the region’s burgeoning venture scene.
Upper90, FJ Labs, Angel Ventures, Presight Capital and a slew of angel investors participated in the round. Those angels included David Geisen, head of Mercado Libre Mexico; BEA Systems’ co-founder Alfred Chuang; and Tushar Ahluwalia, founder of Razor Group, a European marketplace aggregator, among others.
Founded in late 2020, Valoreo aims to invest in, operate and scale e-commerce brands as part of its self-described mission “to bring better products at more affordable prices” to the Latin American consumer.
“We were substantially oversubscribed and were therefore able to select investors that not only provide capital, but also additional know-how in key areas,” said co-founder Alex Gruell.
Valoreo joins the growing number of startups focused on rolling up e-commerce brands.
The company’s model is similar to that of Thrasio — which just raised another $750 million –– and Perch in the U.S. But Valoreo says its approach has been tailored to “the specific needs of the Latin American market and is specifically focused on the Latin American end customer.”
Another new company in the space called Branded recently launched its own roll-up business on $150 million in funding. Others in the space include Berlin Brands Group, SellerX, Heyday and Heroes.
But as my colleague Ingrid Lunden points out, “the feverish pace of fundraising in the area of FBA roll-ups feels very much like a bubble in the market — not least because none of these still-young companies have yet to prove that the strategy to buy up and consolidate these sellers is a useful and profitable one.”
How it works
Valoreo (which the company says is an extension of the Spanish word “valor,” meaning to add value), acquires merchants that operate their own brands and primarily sell on online marketplaces such as Mercado Libre, Amazon and Linio. The company targets brands that offer “category-leading products” and which it believes have “significant growth potential.” It also develops brands in-house to offer a broader selection of products to the end customer.
Like Thrasio, Valoreo says it’s able to help entrepreneurs who may lack the resources and access to capital to take their businesses to the next level.
Co-founder and co-CEO Stefan Florea says the company takes less than five weeks typically from its initial contact with a seller to a final payout.
Then, the acquired and developed brands are integrated into the company’s consolidated holding. By tapping its team of “specialists” in areas such as digital marketing and supply chain management, it claims to be able to help these brands “reach new heights” while giving the entrepreneurs behind the companies “an attractive exit,” or partial exit in some cases.
“We have different structures, always taking into account the personal objectives of the seller,” Stefan Florea added.
Generally Valoreo acquires the majority of the business, with the purchase price typically being a combination of an upfront cash payment and a profit share component so sellers can still earn money.
Looking ahead, Valoreo plans to use its new capital mostly to acquire and develop “interesting” brands, as well as build out its current team of 10 while expanding its infrastructure and operations.
The company is currently focused on the Mexican and Brazilian markets, but is planning its expansion into other Latin American countries where it has strong local support systems, such as Colombia, according to co-founder Martin Florea.
“Our mission is to be a pan-Latin American player providing value to the entire region,” Martin Florea said. “Latin America in general and Mexico in particular are in a distinct situation which provides phenomenal opportunities for e-commerce merchants on the one hand but also presents particular challenges on the other hand.”
Those challenges, according to Martin Florea, include limited access to growth capital, a lack of specialized expertise in certain areas (such as supply chain management), limited opportunities to sell their business and pursue new ventures, as well as operational burdens and the lack of capacities to expand into new countries and marketplaces.
Valoreo emphasizes it is not out to compete with Mercado Libre, Amazon and other regional marketplaces but instead wants to partner with them.
“Without these platforms, this opportunity would not exist,” Martin Florea said.
Hernán Fernández, founder and managing partner of Angel Ventures, believes Valoreo “will add a lot of value” to the Latin American e-commerce landscape, which is experiencing both market growth and the fragmentation of the seller space.
Jüsto co-founder and CEO (and Valoreo investor) Ricardo Weder notes that the e-commerce market is at an inflection point in Latin America. According to eMarketer, the region was the fastest-growing e-commerce market in the world in 2020, with 37% year over year growth. However, it is a much more fragmented and crowded market compared to other regions, such as the United States.
This, Valoreo believes, provides an opportunity for consolidation.
“There are still many consumers that are not aware of the great variety of outstanding local brands that sell innovative products on marketplaces online,” Stefan Florea said. “In the U.S. or Europe e-commerce is the new way of shopping, offering an even greater range of products and brands than offline shopping. We firmly believe it will not take long until end-customers in Mexico and across Latin America discover all the benefits that e-commerce offers.”
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Newly funded Maisonette is becoming a go-to brand for fashion-conscious families; here’s how
Maisonette, a four-year-old, New York-based company, has aimed from the outset to become a one-stop curated shop for everything a family might need for their young children.
That plan appears to be working. Today, the company — which launched with preppy young children’s apparel and has steadily built out categories that include home décor, home furniture, toys, gear and accessories — says it doubled its number of customers last year and tripled its revenue. Indeed, even as COVID could have crimped its style — sales of children’s dress-up clothes slowed for a time — its DIY and STEM toy sales shot up 1,400%.
Though the company keeps its sales numbers private, its growth is interesting, particularly given the unabated growth of Amazon, which became the nation’s leading apparel retailer somewhere around the end of 2018.
Seemingly, much of Maisonette’s traction owes to the trust it has built with customers, who see its offerings as high-end yet accessible relative to the many luxury fashion brands that are also increasingly focused on the children’s market, like Gucci and Burberry.
Specifically, the 75-person company has a merchandising team that prides itself on working with independent brands and surfacing items that are hard to find elsewhere.
Maisonette also launched its own apparel line roughly 30 months ago, called Maison Me. Focused around “elevated basics” at a more reasonable price point, the line, made in China, is seeing brisk sales to families who buy items time and again as their kids outgrow or wear holes in them, says the company.
It helps that Maisonette’s founders have an eye for what’s chic. Co-founders Sylvana Ward Durrett and Luisana Mendoza de Roccia met at Vogue magazine, where Durrett spent 15 years, joining the staff straight from Princeton and becoming its director of events (work that earned her a high profile in fashion circles). Roccia joined straight from Georgetown the same year, 2003, and left as the magazine’s accessories editor in 2008.
For those who might be curious, their former boss, Anna Wintour, is a champion of theirs. Yet they also have some other powerful advocates, including NEA investor Tony Florence, a kind of e-commerce whisperer who on behalf of his firm has also led previous investments in Jet, Goop, and Casper.
NEA is an investor in Maisonette, as is Thrive Capital and the growth-stage venture firm G Squared, which just today announced it led a $30 million round in the company that brings its total funding to $50 million.
Another ally is Marissa Mayer, who first met Durrett back in 2009 when Mayer was still known as Google’s first female engineer and its most fashionable executive. Not only has their friendship endured — Mayer says she named one of her twin daughters Sylvana because she adored the name — but Mayer is on the board of Maisonette, where she has presumably helped refine its data strategy, including around an inherent advantage that the company enjoys: its very young customers.
“One of the things that’s really helpful when it comes to data and e-commerce is when you can capture people at a particular life stage,” Mayer explains. “It’s why people liked wedding registries. You get married, then you have children and [the retailer] can follow the children’s ages and start anticipating that customer’s needs and what they’re going to want two years from now.”
In terms of “predictable supply chain, for inventory selection, for just being able to meet that moment, having insight into those stages is really important and helpful,” she says. It can also be very lucrative for Maisonette as it continues to build out its business, notes Mayer.
Certainly, much is working in the company’s favor already. To Mayer’s point, Roccia says that more than half of Maisonette’s sales last year came from repeat customers. More, it already has an audience of more than 800,000 people who either receive emails from the company or follow its social media channels. (Maisonette also features a healthy dose of content at its site.)
Unlike some e-commerce businesses, Maisonette is asset-lite, too. Though it has opened a handful of pop-up stores previously and was contemplating a bigger move into retail (“that’s now on pause,” says Durrett), the company doesn’t have warehouses to manage. Instead, items are shipped directly to customers from the various retailers featured at its site.
Perhaps most meaningful of all, the company is competing in what is a massive and growing market. In the U.S. alone, the children’s apparel market is estimated to be $34 billion. Meanwhile, the children’s market is $630 billion globally. While Maisonette is selling to U.S. customers alone right now, it plans to use some of that new funding to move into international markets, says Roccia, who has been living in Milan with her own four children during the pandemic, while Durrett began working out of Maisonette’s mostly empty Brooklyn headquarters in January to create a bit of space from her three.
Indeed, on a Zoom call from their far-flung locations, they talk at length about parents needing to create new space to work from home right now, as well as to update rooms for kids attending virtual school. While no one asked for a global shutdown, home décor is a “category that has picked up due to the COVID effect,” notes Roccia.
Asked what other trends the two are tracking — for example, Maisonette features the mommy-and-me clothing pairings that have become big business in recent years — Roccia says that even with the world shut down, it remains a “huge” trend. “It started with holiday pajamas — that was kind of the catalyst to this whole movement — and now swimwear and just casual dressing has become a pretty big piece of the business, too.”
As for what Durrett has noticed, she laughs. “Llamas are big. We sell a llama music player that we had to bring back on the site several times over the holidays.” Also “rainbows and unicorns. As cliché as it sounds, we literally can’t keep them in stock.”
Unicorns, she adds, “are a thing.”
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