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BFD Expert Voices - Retail Deals

BFD Expert Voices

Amazon is testing new search capabilities for e-commerce using generative AI that will become available in the coming weeks, says a leader at AWS.

Why it matters: While Amazon has long leveraged traditional analytics and machine learning for forecasting and supply chain management, generative AI is a new foray for the tech giant.

Details: Amazon has been working on new features, currently in the test and trial phase, Justin Honaman, head of the worldwide retail and consumer goods go-to-market team at AWS, told Richard on the sidelines of the AWS Summit New York yesterday.

Near term, generative AI will be useful for better-managing customer data, improving product recommendation engines, and personalization of the shopping experience.

For Amazon customers who log onto its e-commerce website, that will mean improved search capabilities, Honaman says.

For example, a user could search using a phrase such as "running in a race in Boston in September," and suggestions would materialize, he says, though declined to be more specific.

Zoom out: The generative AI buzz in recent months, spurred by ChatGPT, has sparked an explosion of interest from retailers, Honaman says.

Top retail executives — from the CIO of luxury retailer Saks to the head of analytics at Mars — have approached Amazon with use cases they think generative AI can solve, he says.

Zoom in: In one specific use case, an apparel retailer wanted to take a dress it was selling on its website and put it on a different, specific type of model with a different, specified background, he says.

Generative AI produced an image that needed no touching up in less than 11 seconds.

Another use case is Amazon's partner Obsess, which creates virtual stores for brands. Obsess currently allows for 2D images because 3D images of products have been historically expensive to create, which Honaman says generative AI can solve.

What we're watching: Generative AI will be a key technology to making virtual reality affordable for brands.

1 big thing: Amazon leveraging generative AI for search

Photo Illustration by Sheldon Cooper/SOPA Images/LightRocket via Getty Images

GlossGenius, a salon operating software and payments startup, raised $28 million in funding led by L Catterton, valuing the business at $510 million, Fintech Deals' Lucinda Shen writes.

Why it's the BFD: The company was valued at $360 million in September 2022.

Details: GlossGenius, like restaurant software business Toast, earns revenue from subscriptions and payments.

CEO Danielle Cohen-Shohet says revenue grew more than 100% over the last 12 months to a figure in the tens of millions.

Bessemer and Imaginary Ventures also participated in the round.

The big picture: The beauty services industry was one of the hardest hit during the pandemic. Still, the Bureau of Labor Statistics projects that the industry will grow at a faster clip than the rest of the employment market in the next decade.

The BLS expects the economy to add 7.7% more jobs between 2020 and 2030. It expects growth to be 33% for the personal care services industry.

That comes as more men are seeking grooming services, and Zoom has only magnified consciousness.

State of play: The company's raise comes as a number of other salon software businesses have continued to gather funding in the last year.

Mangomint raised $13 million, as announced in December.

Boulevard raised $70 million in a deal announced in August.

Luxembourg-based Salonkee raised $28 million in June.

2. The BFD: GlossGenius gets a $500M valuation

Illustration of a hand with green money stylized nail polish.   

👕 Shein, the Singapore-based fast-fashion company, has been making overtures to U.S. brands that already have a presence on Amazon and Shopify.

The company has been offering incentives such as waiving commission fees for several months, The Information reports, citing people familiar “with the approaches.”

Some of these brands are a bit more upmarket than what’s normally associated with Shein.

3. Retail therapy

Illustration of a therapy couch with a pillow made of money.

• Goodwater Capital, a Burlingame, Calif.-based early-stage venture firm focused on consumer tech, raised $1b total for its fifth early-stage fund and third opportunity fund. https://axios.link/3QbScMk

• Haymaker Acquisition 4, the fourth blank check company led by Steven and Andrew Heyer targeting consumer businesses, raised $200m in an IPO by offering 20m units at $10. https://axios.link/43GAdRh

• Bansk Group, a New York-based consumer-focused private investment firm, raised $800m for its inaugural fund. www.banskgroup.com

• KKA Partners, a German private equity firm, raised €230m for its second fund. www.kkapartners.com

• Wex, a Portland, Maine-based logistics management company, will invest up to $100m through 2025 into early-stage companies focused on the energy transition. www.wexinc.com

🤖 Collaborative Robotics, a Santa Clara, Calif.-based robot maker, raised $30m in Series A funding led by Sequoia Capital. https://axios.link/453gaNQ

• Croissant, a Nashville- and New York-based online check-out and buyback software provider, raised $24m in seed funding from Portage Ventures, Third Prime, BoxGroup, 25madison and Twelve Below and KKR co-founders. https://www.croissant.com/

🍷 Full Glass Wine Co. acquired Winc.com, a Los Angeles-based direct-to-consumer wine membership club, from Amass Brands Group. www.winc.com

• Point Pickup Technologies, a provider of enterprise-only retail branded fulfillment and delivery services, has merged with Pickup Now, an enterprise-level last-mile delivery service focused on large item delivery and assembly. https://axios.link/3q5D74i

• Oaktree Capital Management acquired a majority stake in Magnolia Wash Holdings, a Charlotte, N.C.-based chain of car wash locations backed by A&M Capital Opportunities Fund. www.magnoliawashholdings.com

• Marico, an Indian consumer goods company, has acquired a 58% stake in Satiya Nutraceuticals, which owns a plant-based nutrition brand, for 3.69 billion rupees. Marico already owned a 32.75% stake in the company. https://axios.link/3DsXrQl

4. Retail transactions

• Leah Sutton was hired by Balderton Capital, a U.K.-based venture firm, as its chief portfolio talent officer. She was previously at Elastic. www.balderton.com

• Roy Luo was promoted to general partner of the growth investing practice of ICONIQ Capital, a San Francisco-based investment firm. www.iconiqcapital.com

• Paul Toms, Wayfair’s chief people officer, has transitioned to the CMO role. He succeeds CMO Bob Sherwin, who will leave the company. https://axios.link/3QfCHTt

• Charlie Eitel was named CEO of Serta Simmons Bedding, succeeding Shelley Huff, who is leaving the company. Eitel is a current board member and a former CEO of the company. Tim Oakhill was named CMO, succeeding Guy Longworth, who is exiting the company. This follows Serta’s recent exit from Chapter 11. https://axios.link/3Kg0UFJ

• Russell Kelly was named chief operations officer of Fourtané Jewelers. https://axios.link/3Yc11HP

• Donny Lau, former Dollar General exec, was appointed CFO of fast food franchise Zaxby’s. https://axios.link/3OytmVV

• Steve Provost, executive vice president and president of restaurant franchise Maggiano’s Little Italy, will retire at the end of August. https://axios.link/44J1nbE

• Giorgio Bianchetti Gonzalez was named chief merchandising officer of grocery chain The Fresh Market. https://axios.link/44JMINf

• Greg Hughes, the chief growth and brand officer at Beam Suntory, will become CEO, succeeding Albert Baladi, effective Oct. 1. https://axios.link/471Qy69

5. It's Personnel

Happy Thursday, Retail readers. Let's dive in.

❌ Situational awareness: Zara owner Inditex says it’s working on exiting Myanmar — a country beset by a political and humanitarian crisis — by continually reducing the number of active manufacturers there, per Reuters.

📺 What we're watching: Richard caught up on some of the movies on his watch list, including "Dungeons & Dragons," which had a lot of action, but not enough character development or backstory. 

✏️ Many thanks to newsletter editor Claire Rychlewski and copy editor Mickey Meece for today's edits.

July 27, 2023

1 big thing: Amazon leveraging generative AI for search