Luxury Clothing Startup Everlane Crowdfunds Its Canada Launch, Targets More International Growth

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It’s becoming very clear that crowdfunding isn’t just for nascent upstart projects anymore. The latest example of this: Everlane, the company that produces and sells luxury clothing and accessories at a discount since it’s online-only and vertically integrated, is raising $100,000 in a crowdsourced campaign to determine whether it will extend its reach into Canada.

The effort, which began this morning, has been a big success so far, with some 480 contributors committing more than $32,000 just nine hours into the 17 day campaign.

Crowdfunding for data’s sake — not for the money

It bears mention that the money being raised is not all that’s necessary to fund the Canadian launch. Each donation tier provides a gift that’s equal to the amount given — $15 gets a $15 gift card (or a $15 Everlane tee,) $60 gets $60 gift card, and so on. “We’re not using any of this to fund the operations,” Everlane founder and CEO Michael Preysman said in a phone interview today. “It’s our internal benchmark. We said, ‘If we hit this mark, there are a lot of people in Canada who really want Everlane.'”

Looking ahead, Preysman says Everlane is eyeing even more international expansion, with launches in the UK and Australia hopefully on deck by the end of 2013. Today, Everlane currently has more than 500,000 members in the US alone.

It’s an interesting example of how crowdfunding can be valuable even for companies that don’t necessarily need the money. Hard data about consumer intent can be hard to come by, and crowdfunding provides concrete feedback about people who are truly interested in something — people who will put money down are clearly pretty serious about wanting a product. Traditionally it’s been used by upstart projects that need the money to take the next step, but this shows that it can be a valuable data collection tool in itself.

Making a launch less of a ‘shot in the dark’

It’s a big departure from how small e-commerce companies typically handle international expansion. The status quo way to evaluate which regions to expand to next is counting the inbound requests received via email — an obviously vague way of gauging demand.

“Bigger companies can do significantly-sized user studies, but for smaller companies like us, it’s a shot in the dark,” Preysman said. “There have been a number of instances where you see startups enter, say, Europe and it just doesn’t work out.”

The risk of something not working out is not one that Everlane was keen to take. “We had a lot of people emailing us asking ‘When is Canada coming?’ But it’s not easy for us to just launch another country,” he said, noting that Everlane, which has taken on $1.1 million in venture capital, has just 19 full-time staffers who handle all design, production, marketing, and IT in-house.

The crowdsourcing move was a risk as well, though. “We spent a lot of time on this idea, wondering, ‘Is this the way to enter a country, will people get upset, will people understand, will the $100,000 number be right?'” Preysman said.

Luckily for Everlane, the response has clearly been a positive one — and it’ll be interesting to see if others follow suit.


This post has been updated to point out that each donation tier provides a gift equal to the dollar amount given.