Cotopaxi, an e-commerce startup that also emphasizes making the world a better place, has raised $6.5 million in Series A funding.
While many startup founders want you to believe that they’re idealists in pursuit of a big mission, co-founder and CEO Davis Smith told me (via email) that Cotopaxi is helping humanitarian causes in concrete ways — not just because the products are created in sweatshop-free factories, and not just because the company promises to donate a portion of its profits.
The company also ties each purchase directly to a specific impact, as Smith explained:
For example: If you buy the Inca backpack, you’re giving one week of tutoring to a child in an orphanage in Bolivia. If you buy the Sambaya fleece, you’re giving one cancer treatment to a woman in Senegal. If you buy the Cambodia water bottle, you’re giving six months of clean water to someone in Cambodia. Every product has its own unique story. Our goal is to help users of our products to feel a direct connection to a cause, country and individual story.
He added that Cotopaxi’s most popular products are its lifestyle backpacks. It’s also expanding events with 24-hour team races called Questivals, which have had 6,000 participants so far. There are plans for more than 20 events in 2015.
By the way, Cotopaxi is incorporated as a Benefit Corp., which means that even though it’s a for-profit company, it also has a legal responsibility to its broader mission. (Social network Ello is also touting its B-corp status, arguing that this will allow it to stay ad-free.)
As for whether taking on venture investors and their expectation of big returns will create any tension with that mission, Smith said:
Investors keep entrepreneurs accountable, push them, and give a nudge in the right direction – when needed. Not only that, but the success of our social mission is directly tied to the scale of our business. The larger we can grow, the larger the impact we can have. Raising venture money allows us to accomplish our social mission, of empowering those living in extreme poverty, in a rapid and scalable way.
Cotopaxi previously raised $3 million in seed funding. The Series A was led by Greycroft Partners, with participation from NEA, Forerunner Ventures, Lerer Hippeau Ventures, and angel investors including Jeff Kearl (Stance) and Josh James (Domo). [Update: Other Series A investors include Brand Foundry.]
Looking ahead, it sounds like Cotopaxi will remain focused on backpacks and outerwear, but Smith said the company is also developing “a number of new and innovative products outside of these two primary categories.”