Online custom men’s wear firm Indochino has raised $13 million in Series B fund-raising.
The latest round was led by Highland Consumer Fund and includes existing investors Madrona Venture Group, Acton Capital Partners and Jeff Mallett.
Tom Stemberg, managing general partner at Highland, said, “Having looked at all of the companies in the space, we believe that Indochino has the most sophisticated approach to mass customization of suits and formalwear.”
As part of the investment, Stemberg will join Indochino’s board. Stemberg, who founded Staples, also is on the Lululemon Athletica and PetSmart boards. Highland’s investments in the apparel, retail and beauty space include J. McLaughlin, City Sports and StriVectin.
The Vancouver-based firm started its business selling custom suits, but now offers sport coats, outerwear, dress shirts, slacks and accessories, such as ties.
Kyle Vucko, cofounder and chief executive officer, said, “The money will go towards building out our supply operations channel, [expanding] our apparel categories, growing our online marketing presence and for our pop-up stores.”
Custom suits start at $379 and shirts at $79. Vucko said it takes on average three weeks from the time an order is placed to when it is ready to ship.
The company is planning on ten pop-up sites this year. It already had one in Washington, D.C., last month and a three-week event starts next week in Boston. The pop-ups typically last a week. Last year, there were four: Chicago, New York and San Francisco in the U.S., and Vancouver.
The pop-up sites typically are in urban markets near business hubs close to metro lines. The one in New York last October was in Grand Central Station.
“We found pop-ups to be successful in transitioning people from offline to online,” said Vucko.
So far venture capital investments in Series B and C rounds total more than $190 million in the first quarter of 2013. In addition to Indochino, a recent round completed in the men’s wear arena was the $30 million Series B raised by Bonobos, led by new investors Glynn Capital and Mousse Partners. Existing investors — Nordstrom, Accel, Lightspeed Venture Partners and Forerunner Ventures — also participated in the B round.