Dive Brief:
-
Lifestyle subscription service FabFitFun announced Wednesday that it raised $80 million in Series A funding led by Kleiner Perkins. Existing investors, including NEA and Upfront Ventures also participated, according to a company press release.
-
The new funding will go toward expanding membership offerings, evolving the platform as a marketing partner and launchpad for brands, and global expansion, the company said.
-
Kleiner Perkins General Partners Mood Rowghani and Mary Meeker will join the company's board, the company also said.
Dive Insight:
FabFitFun has come a long way since its humble beginnings in 2010 as a digital magazine. Three years later, it began its four-times-a-year seasonal subscription service, which notably rose in popularity thanks in part to engagement on Facebook. The company has since capitalized on its attention on the social media platform, adding Facebook live video programming to its content mix in September 2018.
Those efforts appear to be paying off so far. In November, the company announced it hit 1 million subscribers. Hitting metrics like this is one indicator of still untapped growth in the eyes of investors.
"FabFitFun has emerged into an exciting and entirely new distribution channel that brings retail to the platforms where consumers are most engaged," Rowghani said in a statement regarding the funding news. "The company's personalized connection with its community allows brands to better understand and interact with consumers — establishing a long-term relationship rather than simply a transaction."
These days it seems like just about every retailer and brand under the sun has a subscription or boxed service of some kind. Think Rent the Runway Unlimited, J.C. Penney's Big and Tall box or even BarkBox for pets. But depending on the category, retailers and brands offering subscriptions have struggled with notoriously high cancel rates and challenges with the reverse supply chain. But as a seasonal service and media company, Co-CEO Michael Broukhim has said he views the company as more akin to companies like Netflix, Amazon Prime and Spotify, all easy signups for consumers because of their value.
Backing from Kleiner Perkins is also a big win. The firm is known for its deep pockets and savvy investments in businesses like Blue Nile, Dollar Shave Club, Stripe, Airbnb and many others. Between 2008 and 2018, the firm made 28 investments in the retail space, making it the fourth most active VC firm to invest in the category, according to information provided to Retail Dive from Pitchbook.
