OIive eyes fundraise as it shifts sustainable delivery to B2B model
Olive, a sustainable delivery service started up by Jet.com co-founder Nate Faust, is eyeing a fundraise as it relaunches itself as a B2B business, the entrepreneur tells Axios.
Why it matters: Ordering goods online may save time and money, but its impact on the environment makes it unsustainable, and shoppers are noticing. Now, Olive can work directly with retailers to remove single-use packaging at the source.
What's happening: Olive, which raised funds from existing investors earlier this year, plans another capital raise end of this year or early next to accelerate the build-out of the business, Faust says.
- He declined to disclose additional details, but said to date, the company has raised nearly $20 million (comprised mostly of traditional growth equity with a little bit of venture debt).
- Invus Group, Primary Venture Partners and SignalFire sit at Olive's cap table.
What they're saying: "We’ve transitioned from our initial model, which was consumer-facing, to working with brands directly, which was something initially we didn’t think would be possible, not until we had much greater scale," he tells Richard.
By the numbers: Olive's resale business brings in between $15 million and $20 million on an annualized basis.
- Its logistics business already generates more than $1 million in annualized revenue even though it just launched.
- It's currently conducting 2,000 deliveries per week at a fee of $10 per delivery or pickup, though it doesn't get paid for all pickups.
How it (used to) work: Launched in 2021, Olive started by offering a delivery service directly to consumers, collecting and combining multiple fashion orders (from various retailers) into a single, weekly delivery.
How it works now: Shoppers placing an order with a brand offering Olive's waste-free delivery option can choose it at checkout, instead of having to directly sign up for it.
- Importantly, this also eliminates waste generated from the item's original packaging.
- Olive partners with retailers such as Rhone, e-commerce platforms like Rent the Runway, and logistics providers, namely Bergen Logistics.
Yes, and: Customers can return the purchases they don't want to keep.
- If no returns, consumers can now place other fashion items they want to toss on consignment since that reusable packaging will be picked up regardless.
- Thanks to Olive's acquisition earlier this year of Linda's Stuff, one of eBay's largest sellers, the company is able to process consignment items.
- Olive claims it helps shifts consumer behavior from “buy, buy, purge” to “buy something, sell something.”
Of note: Olive also integrates with third-party logistics providers that are utilized by most brands.
- Bergen, for example, counts several hundred DTC brands as customers, Faust says.
Flashback: Prior to Olive, Faust co-founded Jet.com in 2014, which was then sold to Walmart for $3 billion in 2016.
- He then served as SVP of Walmart's U.S. e-commerce supply chain, helping the discounter build out its digital capabilities as it played catchup to Amazon.