SWaN & Legend Venture Partners led a $6.8 million Series A funding round in UrbanStems, an on-demand flower delivery service. Other participants in the funding included Middleland Capital, NextGen Venture Partners, Interplay Ventures and Sagamore Ventures. The funding will help UrbanStems expand in New York City and Washington, D.C. as well as other cities in the U.S., starting with Philadelphia and Baltimore.
UrbanStems, the on-demand flower delivery service, announced today the close of a $6.8m Series A funding round led by SWaN & Legend Venture Partners with investments from Middleland Capital, NextGen Venture Partners, Interplay Ventures, and Sagamore Ventures. The new funding will allow UrbanStems to accelerate growth in New York City and Washington, D.C. and to expand to other major cities in the US, starting with Philadelphia and Baltimore.
Online flower delivery has long been plagued by low satisfaction ratings from both senders and recipients. UrbanStems has developed an unparalleled floral gifting experience that allows customers to send seasonal bouquets hand-delivered by bike messengers within one hour, for as low as $35 with free delivery.
Like many of its on-demand startup peers, UrbanStems has hired a core team of in-house bike couriers that enable it to consistently deliver an exemplary gifting experience. The couriers even snap a photo of each bouquet outside its final destination so customers know exactly when their gift arrived and can see what the flowers look like.
As startups nationwide increasingly focus on sustainable unit economics, UrbanStems remains ahead of the curve. “From day one, we focused on designing the best possible experience for the customer,” says co-founder Ajay Kori. “We then worked backwards to figure out how to make margins sustainable, and ended up creating one of the most unique supply chains in the industry.”
UrbanStems has designed an unprecedented, vertically-integrated supply chain to reduce waste and cut out eliminate many unnecessary costs that plague the traditional floral supply chain. Kori says, “In an era where the on-demand space has rightfully come under a lot of pressure, we’re using proprietary innovation to provide both the best possible experience and one of the most affordable price points in the industry, while maintaining strong product margins.”
SWaN & Legend Managing Director David Strasser said the firm invested in UrbanStems because of its unique, scalable offering, “We are always on the lookout for companies like UrbanStems that are so disruptive that they actually change an industry while attracting deeply, even obsessively, loyal customers. When we find one of these game changers and it is led by people as smart and dynamic as Ajay Kori and Jeff Sheely, we know we are making a strong investment. I look forward to working with them to help them expand their business across the United States.”
Middleland Capital’s Alex Pessala echoes this sentiment, “UrbanStems has built an amazing brand behind a best in class product and superior user experience. During a time where ecommerce and product delivery companies are hemorrhaging due to horrible unit economics and high burn rates, UrbanStems developed a business with fantastic margins and significant growth potential.”
UrbanStems designs its bouquets in-house and works directly with Rainforest Alliance Certified™ farms to offer a limited selection of monthly arrangements designed to appeal to modern consumers. Customers can order directly from the company’s website www.urbanstems.com.
You can’t buy happiness, but you can send flowers, and that’s pretty much the same thing. That’s why UrbanStems, an on-demand flower delivery service, was created – to spread happiness by making gifting fun and easy. The company launched in Washington, DC on Valentine’s Day in 2014 to combat the typical industry blues: dead flowers, late arrivals, and crazy-high prices. In December 2014, UrbanStems expanded to New York City. In February 2015, UrbanStems raised $1.5 million in seed funding. For further information, please visit: www.urbanstems.com
About SWaN & Legend Venture Partners
Founded in 2012, SWaN & Legend Venture Partners invests in companies that are building engaging brands worthy of consumers’ passions in the fields of retail products and services; technology-enabled commerce and education; food and hospitality; and sports and entertainment. Managing partners Fredrick D. Schaufeld, Anthony Nader, David Bosserman, Todd Klein and David Strasser work closely with staff and Limited Partners to invest in innovative early and growth-stage organizations headed by top-flight teams. They seek to be active and influential in the companies, in which they invest, providing guidance, support, resources and confidence to the teams. The partners actively offer their experience, energy and deep network of friends and partners to help portfolio companies continue to build high-growth businesses. Collectively, the partners have raised more than $5 billion of institutional financing and participated in more than 150 private investments. For further information, please visit: www.swanandlegend.com
About Middleland Capital:
Middleland Capital is a Washington DC based private investment firm focused on global early-stage technology opportunities. Leveraging a unique breadth of geographic and industry experience, the firm seeks partnerships with exceptional management teams to commercialize innovative technologies, accelerate growth and build long-term value around the world. For further information, please visit: www.middlelandcap.com