May 04, 2022
Hello, Retail readers!
Situational awareness: Glass Lewis is backing Kohl’s director slate.
Axios Pro tomorrow hosts a pair of live, interactive virtual events:
🌎 Climate Deals at 12:30pm ET with Jigar Shah, director of the Loan Programs Office at the Department of Energy. Register.
📺 Media Deals at 2:30pm ET with Linda Yaccarino, NBCUniversal's chair of global advertising and partnerships. Register.
1 big thing: Funding e-commerce fulfillment
Outerspace, a fulfillment and logistics company, raised $30 million in a Series B round, co-founder and CEO Ricky Choi tells Kimberly.
Why it matters: As more digital consumer brands run their e-commerce businesses through a warehouse, Outerspace is touching on a need for companies to tailor those spaces to better fulfill customer orders and improve customer service.
Context: The round, which is led by Prysm Capital with the participation of existing investors, brings its total funding to just over $40 million.
- Prysm is also a backer of Rivian and Everly Health.
Details: The funding will go toward expanding the company’s footprint and enhancing its software product.
- The company expects to cross $100 million in cumulative revenue this year, Choi says.
How it works: Choi, who founded men’s underwear and socks brand Nice Laundry in 2013 alongside Phil Moldavski (also an Outerspace founder), says he started by building a fulfillment center in-house for his brand that had tons of office space, a photo studio and lots of the cross-functional resources that a brand needs.
- “You’re doing a lot more individual things — tissue paper — things like that,” he says.
- Companies are able to deliver a better customer service response with this approach, Choi says, such as being able to switch out a product or change a shipping address in real time.
Of note: The idea has caught on with brands such as Jay-Z’s Paper Planes, Homesick Candles, Hill House and a host of others.
What’s next: “We recognized early on that real estate was going to be an important component to this business,” Choi says.
- One of Outerspace’s early investors is Tishman Capital Partners and it also counts Benjamin Harris, the former CEO of Link Logistics Real Estate, Blackstone’s U.S. industrial sector operating platform, as one of its independent board members.
- Together, they’ve helped the company navigate this tight industrial real estate market, Choi says.
The bottom line: Outerspace has about half a million square feet in real estate space. Choi expects the company to reach a million square feet by next year's first quarter.