DTC’s Daily Digest brings you the latest news on the world’s fastest growing direct-to-consumer brands. In today’s edition: Kokoon funds ahead of subscription launch; Poshmark moves into home decor; Felcana fundraises with Seedrs.
Kokoon funds ahead of subscription launch
Kokoon, the headphone brand designed to help people sleep, has raised £1m through Seedrs. The brand has clocked up £4.5m in sales whilst still in pre-order phase, shipped 10,000 products worldwide, and was valued at £9.6m before funding.
Kokoon is a digital platform helping people better use audio to help them relax and switch off. The app provides personalised, intelligent audio content and coaching developed with sleep scientists based on clinically validated techniques.
The business is looking to engage frequent travellers, and struggling sleepers, and consumers in noisy environments. Kokoon also has retail partnerships, with a deal in place with Selfridges, and a multimillion-pound pipeline of further retail orders.
In the second half of the year, Kokoon intends to launch a subscription model via the Kokoon app. Subscribers (paying £5.99/mo) will gain full access to premium content, coaching, and features. This follows the well-established business model used by billion-dollar apps such as Calm and Headspace.
The proceeds will be used to drive sales, improve the platform, and accelerate the product pipeline.
Poshmark moves into home decor
Poshmark are expanding beyond second-hand clothes and purses, launching its offering in home decor. The move will see them take on the likes of Wayfair and Rent the Runway, which also recently started renting home goods like throw pillows and blankets.
Poshmark’s new home vertical will be for things like wall art, pillows, candles and other smaller home goods, but not bulky furniture, Manish Chandra, CEO & founder, Poshmark said. Chandra also outlined that Poshmark is still working on perfecting its logistics to be able to handle and ship heavier items.
The secondhand apparel market in the U.S. was worth USD$24bn (£19bn) in 2018, compared with USD$35bn (£27bn) for fast-fashion companies like H&M and Zara, according to data compiled by ThredUp and GlobalData Retail. But by 2028, the used fashion market is set to jump in value to USD$64bn (£50bn), while fast fashion will only reach USD$44bn (£35bn).
Poshmark has raised almost USD$160m (£126m). Its last round, a Series D in November 2017, was for USD$87.5m (£69m) and valued the company at nearly USD$600m (£471m). Major investors include Mayfield, GGV Capital, Menlo Ventures and Union Grove Venture Partners.
Felcana fundraises with Seedrs
It’s a good time for DTCs fundraising on Seedrs, with Felcana also getting in on the action. Felcana is an app that helps owners look after their pet’s health and provide vets with the data they need.
Users can gain on-demand online veterinary advice and critical insights into their pet’s health and well-being. After a overfunded Seedrs campaign in 2018, and backed by capital investors Innovate UK, Felcana are now looking to achieve commercialisation.
The business is going to commercialise on B2C channels, such as their own website and on third party retailers, as well as on B2B channels like pet insurers and pet health plan providers. Felcana will also be introducing a subscription model later in 2019 to provide a recurring revenue stream.
The plan is to split the funding 60:40, with 60% going towards sales and marketing (growing customer reach and brand awareness through increased marketing expenditure), and 40% towards product development (launching their on-demand vet service, and expanding data science capabilities).