Prive, a San Francisco-based startup founded by two former Uber product managers, just raised $ 1.7 million in pre-seed funding to create what it describes as a commerce subscription platform much more customizable electronics for D2C brands.
The cycle was co-led by Patrick Chung and Brandon Farwell at XFund and Ben Ling at Bling Capital, with input from Defy Partners, Halogen Ventures and Uber executives.
Founded by Claudia Laurie and Alex Craciun – who both spent two and a half years at Uber and decided, based on their knowledge of pricing and incentives, to leave the company earlier this year – Prive aims to do better. allow small retailers to compete with behemoths like Amazon.
The general idea is that by connecting to the existing APIs of Shopify and other ecommerce platforms, Prive can form an opinion that it is selling merchants what customers tend to buy on a recurring basis. Maybe he sees that people who buy razors also tend to buy toothbrushes at a similar rate, for example. It conveys that information, then helps the brand create more personalized and flexible offers so that their buyers are presented with the items they might want, and they can more easily cancel the items that are starting to pile up.
“The market opportunity is huge and the [e-commerce subscription] the tools are only scratching the surface, ”notes Laurie. Indeed, according to the eMarketer group, subscription e-commerce sales have grown by 41% since the onset of the coronavirus pandemic, and it predicts that 3% of retail e-commerce sales in the United States will come from subscriptions this. year, for a total of $ 27.67 billion. This represents an increase of $ 10 billion in just two years.
Of course, there is still a lot to build, which is where the pre-seed funding comes in. Right now, Prive is a seven-person team with some serious competition namely from Recharge, a seven-year-old, Santa Monica. , a California-based subscription-based e-commerce company that in May raised $ 277 million in growth capital at a post-money valuation of $ 2.1 billion. At the time of this announcement, Recharge had around 330 employees and was powering the subscription service for what it said was 15,000 merchants and 20 million subscribers worldwide.
Other competitors include nine-year-old Bold Commerce (he raised $ 44 million in total) and Chargebee, 10, who has raised around $ 220 million over the years, according to data from Crunchbase.
“Ecommerce subscription is an incredibly hot buzzword,” Craciun acknowledges. But he also thinks current product offerings only scratch the surface of service.
Clearly, investors are willing to bet that he is right and that Prive could be a team to prove it.
“Today’s tools can create more headaches than they actually solve,” says Craciun. “There is great rigidity in subscriptions today, which makes it very difficult to identify the right combination of recurring offers. We are here to break this mental pattern.