Our Investment in Kidizen
In late March, we announced our investment in Minneapolis-based Kidizen, leading a $3M Series A round.
We first heard about Kidizen when we traveled to Minneapolis for office hours with the companies participating in the Techstars Retail Accelerator. As an early-stage investor in marketplace companies, we’re very curious about new and novel ways that buyers meet sellers, both in B2B and B2C contexts.
CEO Dug Nichols and co-founders Mary Fallon and Dori Graff were in our office the next week to meet with us in person. Six things made an immediate positive impression:
Dug had created dashboards capturing the most important KPIs and metrics for marketplace businesses, showing a level of depth we rarely see at this stage;
Mary and Dori were building an active community of parents (primarily moms) interested in sharing sensible “kids style” with other like-minded people across the country. This was very different than other online used apparel outlets, which lacked any community features;
The company’s mobile app used familiar social interactions – including ‘follows’, ‘likes’, ‘hashtags’, and ‘shares’ – making it easy for users to tag and purchase favorite items from trusted sellers, and to promote their listings and purchases on other social platforms. Any mom who spends time on Facebook, Instagram, Pinterest, or Twitter will find it easy to immediately start using Kidizen.
The team had created a well-designed user experience for both sellers and buyers. Items can be listed in minutes; sellers receive notifications and printable shipping labels; and buyers pay only when items are shipped. Sellers can even keep their money “in the system” as “Kid Bucks” for their own purchases.
Buying kids clothes is a multi-year journey…so if Kidizen can introduce the service to parents when kids are young, they’re customers for several years – driving strong repeat purchase behavior.
And finally…we were impressed with what the company had accomplished with a small team and a modest amount of capital.
We were not surprised when our diligence led us to many highly satisfied parents. “I’ve tried selling on other platforms…but Kidizen is by far the best,” said one user.
The market for children’s apparel is enormous, estimated at between $32B and $55B in the U.S. annually. At the same time, shoppers are buying from online resale shops in increasing numbers, with 46% expected to make such a purchase in 2014, driving transaction volume from auctions and resale to $300B.
Join the team that’s inspiring parents to sell those outsized duds and find savvy children’s style online! Kidizen is adding positions for developers, designers, marketers, and data nerds.
Kidizen – shop, share, and sell kid style.
