Zola, a fast-growing company that invites newly engaged couples to register their guests, shop from 600 different brands, and create customizable checklists, has itself received something a bit extravagant: $100 million in Series D funding.
Earlier investor Comcast Ventures led the round, which also included new investors NBCUniversal and Goldman Sachs Investment Partners. The five-year-old, New York-based, 110-person company has now raised $140 million altogether.
We talked last night with founder and CEO Shan-Lyn Ma to learn more. Ma is a former executive with the e-commerce companies Gilt Groupe and Chloe + Isabel who originally started Zola to reinvent the traditional registry process but who now sees an opportunity to eventually address every need a young couple may have, from caterers to Cuisinarts, to eventually, perhaps, even home mortgages. Our chat has been edited lightly for length.
TC: You’re a decent size-company at this point. Is everyone in New York?
SM: The vast majority, though we also have a small number in Charlottesville, Virginia. Earlier this year, we acquired the assets of a small wedding startup that had shut down and brought some of that team into Zola.
TC: Have you made other acquisitions? Will you now with this giant new round?
SM: No, and it’s possible, but the bigger vision is to cater to couples from the day they get engaged, into their first years of marriage. We’ll be using the funding to accelerate the product development of more wedding planning tools for couples, so we can be that go-to destination.
TC: How are people learning about Zola?
SM: The biggest growth driver has been people who’ve gone to a wedding where Zola was the registry that the couple used. One hundred and fifty people on average see the registry, and if those visitors believe it’s a better product, [they come to us, too]. It’s built-in virality.
We also picked Comcast Ventures to be our lead investor because Comcast and [fellow investor] NBC are market leaders in media with wide reach. They’ll help us with our marketing and awareness goals, which is a big opportunity and area of focus for us in the coming year.
TC: How many people have used the site to date?
SM: More than 500,000 couples have used our wedding registry or else managed their guest list through Zola.
TC: Zola started as a wedding registry product. Now, it’s a full-fledged marketplace, connecting engaged couples to 600 brands and 60,000 products. Are you making a percentage off each sale?
SM: It’s more like a retail model. Couples can register for items or buy them for themselves; we sell to them at retail prices and buy at wholesale.
TC: Are you buying these products and housing them?
SM: No. We learned from our past experiences in other e-commerce [companies] the pitfalls and land mines, and Zola was built to avoid those problems. We have virtually no inventory and we have virtually no returns, and those are the big reasons why e-commerce is such a tough business.
TC: Can you elaborate?
SM: We’ve built our in-house proprietary drop-ship platform that allows us to connect directly with brand partners to offer their products on Zola. So when an order is placed, we are interfacing with the customer, but when it comes time to ship, we transmit that order to the brand’s warehouse, and they ship directly to the customer.
The reason returns are so low is because we built the registry in such a way that we give couples flexibility to not ship something to themselves until they’re sure they want to receive it. We had the insight that couples don’t want to receive gifts until after they get back from honeymoon. That way, they can see what’s being given to them and do a virtual exchange through the platform if they like, as well as ship themselves the things they definitely do want.
TC: Are brands giving you a discount for promising to buy a certain amount of their products over the course of a year? Why do they let you pay wholesale?
SM: We’re delivering to them a millennial audience and getting their brands in front of couples just as they are deciding on their brand preferences for the rest of their lives. We also deliver a certain degree of predictability to them. We can forecast how much of each product they should expect to sell through Zola in a month’s time
TC: Will we ever see Zola-branded products?
SM: The only instances where it may make sense for us to develop our own product is if we see demand for something that we can’t get through a brand.
TC: I’ve heard you talk about going after the wedding market, which is a $100 billion market in revenue in the U.S. alone. But you also talk about catering to the every need of couples who are just getting hitched. Does that mean connecting them to caterers and travel experiences and mortgages?
SM: Our ambition is to serve couples on that journey, so all of those things are top of mind, and we believe we can help them in unique ways because of the insights we [glean] thanks to our registries and checklists and other wedding planning tools.
TC: How do you weigh profitability versus growth? Do have a timeline for the company to turn profitable that you can share?
SM: One of the big lessons our leadership has learned from past startups and e-commerce [companies] was to build a sustainable business model — and one that can be healthfully profitable in a reasonable time frame.
Right now, we’re investing for growth. But we’re marching toward that goal where we are a huge company, serving companies across the entire wedding-planning journey, and have a business that supports that mission. Absolutely.