One Kings Lane, an ecommerce company for home decor, has raised $50 million in Series D financing led by Institutional Venture Partners (IVP) with additional investment from Kleiner Perkins Caufield & Byers (KPCB), Greylock Partners, Tiger Global Management, and new investor, Scripps Networks Interactive, the home to TV shows like HGTV and The Food Network. This brings the total amount raised to $117 million.
One Kings Lane is a flash sales site for home decor, fashion accessories and more. The company is the brainchild of former merchandiser and fashion executive Susan Feldman and digital media exec Ali Pincus (who happens to be the wife of Zynga co-founder and CEO Mark Pincus). Launched in 2009, One Kings Lane differed from some of its competitors like Gilt and RueLaLa by focusing on a single vertical: deep discounts on all things home. Each day the site launches up to 3,000 new home products assembled around inspirational decorating themes.
And this bet has paid off. The company, which has over six million members (up from four million a year ago), is projected to hit $200 million in revenue this year (up from $100 million in 2011). At the last round of fundraising in 2011, One Kings Lane was valued at $440 million post-investment. While CEO Doug Mack declined to reveal the exact valuation in this round in a conversation with TechCrunch this week, he did say that it was an up round, and that the valuation had a “nice step up.” Not surprising considering over the past year, revenue has grown 100 percent. Mack had previously told us that One Kings Lane is on track to be profitable in the next year or two, and more than 75 percent of sales come from repeat customers, which speaks to the loyalty and engagement of their customer base.
He explained that while One Kings Lane still has plenty of money on hand to last them well through next year, they company decided to take new funding to continue to aggressively expand the business.
“One Kings Lane has proven to be the leading new commerce company for the home, “ said General Partner Sandy Miller of IVP said in a release. “One Kings Lane truly understands the consumer, and delivers innovative shopping experiences and unique products that deliver tremendous value, which has allowed them to build an incredibly loyal customer base, and attract new customers.”
Over the past few years, One Kings Lane has doubled down on curation. The company has long offered Tastemaker Tag Sales, which allows well-known interior designers and celebrities to select sales of home decor items from around the world. One Kings Lane has also expanded to offer an eBay-like marketplace, which allows vendors and designers to post pre-vetted antique and vintage products on the site. Additionally, One Kings Lane has started selling its own brand of items, such as candles.
The company has also been able to participate with a number of successful marketing and development opportunities, including a significant part of the hit Bravo TV interior design reality show, “Million Dollar Decorators”. Considering the strategic investment from Scripps, which has its own home and garden network, we can expect more TV marketing partnerships coming from the ecommerce company.
Most recently, One Kings Lane has dabbled in its own content on TV–commercials. The company started placing commercials on a number of networks, including those owned by Scripps. We’ve embedded the commercials below. Mack says that the commercials have worked for both driving sales as well and brand exposure. “The commercials pay for themselves with the increase in revenue and the brand building is a bonus,” he says.
The new investment will be used towards additional brand building efforts and partnerships.
In terms of product, mobile has been a big growth area for One Kings Lane. Currently, more than 25% of monthly revenues are stemming from mobile purchases. Mobile is a significant driver, and 50% of traffic on Thanksgiving Day came from mobile. Mack says the new funding will be invested in product development, particularly around mobile technologies and personalization.
He explains that the company has already built the database around mining the information necessary to personalize the experience and now it’s just a matter of creating meaningful products and experiences around the technology. Over the past two months, One Kings Lane, which has a total of 350 employees, has added 20 people to its technology team and plans to add more talent.
Another area where One Kings Lane will be putting cash is towards merchandising, and continuing to make sure that the site has high quality, and hard to find items for sale.
One Kings Lane has proved that the niche commerce model can create a sustainable business in an Amazon world. Most recently, another niche ecommerce site Zulily, a flash sales site for moms, raised $85 million, and was valued at $1 billion in the round. This just proves that with the right merchandising, curation, audience and technology, commerce doesn’t always have to be about unlimited product availability. Sometimes less is more.