Mobile marketplace Spring is gaining traction with some big-name investors and just raised $25 million to help scale up its business.
This story first appeared in the April 16, 2015 issue of WWD. Subscribe Today.
Spring was one of the most buzzed-about app launches last summer, viewed largely by the industry as a “shoppable Instagram” that enabled consumers to purchase from a photo-driven, mobile experience.
The latest round was led by Box Group, Spring cofounder and chairman David Tisch’s venture fund, and included participation from Silas Chou, the Arnault family’s private equity arm Groupe Arnault, Google Ventures, Thrive Capital, Wendi Deng Murdoch, Yuri Milner and Ashton Kutcher’s Sound Ventures.
Along with Tisch, the founding team — chief executive officer Alan Tisch, chief marketing officer Ara Katz and chief technology officer Octavian Costache — raised $7.5 million prior to launch, bringing funding to date to $32.5 million.
Spring began as an iOS, mobile-only marketplace, but will also expand its product to Android devices today and roll out a Web presence this summer. The Android version was designed from the ground up, according to Alan Tisch, who said the app is compatible with Google Wallet and Google sign-in support. Unlike the app, which has a selection of product from each brand, the Web site will offer entire product catalogues and sync up with digital flagships.
“We’ve heard from customers that they want to shop a brand’s entire catalog, not a small selection,” Alan Tisch said. New brand pages will be added when the site goes live and product availability will be represented in real time.
Additionally, Spring will significantly invest in advertising and e-mail marketing and grow its team of 50 to nearly 75 by year’s end.
The eight-month-old app allows users to shop directly from a community of brands in one contained destination with more than 20,000 products. The venture launched with 450 brands signed up and now carries upwards of 750 brands, including Calvin Klein, J. Brand, Mary Katrantzou and Everlane. Another 300 brands will roll out in the coming month, including Proenza Schouler. Spring takes a cut of between 2.5 percent to 5 percent of each sale and offers incentives, for instance, cutting the transaction fees when brands offer free shipping or launch a product exclusively on the platform.
The ceo declined to say how many downloads the app has received to date, but noted that Spring sees a repeat-purchase rate of 44 percent and sales volume on the app has doubled in the past three months.
To help keep that growth up, Spring is bringing the customer-service function in-house. Tisch said having one point of contact — originally a customer could contact Spring or the brand — is paramount.
“You call, text or e-mail us and we handle everything for you, similar to American Express. That was a big learning experience,” he said.
Spring gives designers and brands complete control of the shopping experience — from how the product is presented and merchandised to logistics.
David Tisch said this is what makes spring more attractive to brands, which also have the option to sell goods on a retailer’s site on a wholesale basis.
He said the app and upcoming site were “direct-to-consumer channels, and that customers really like buying from brands directly. On Spring, you get the box from the brand and that’s a powerful thing. When you get it the first time it’s such a natural experience. It’s the brand telling their story. It’s not just a brown box with no branding.”