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Birchbox raises $10.5 Million in Series A Funding
Birchbox, a start-up company functioning as a makeup discovery retail platform has recently announced the fact that it has managed to raise an amount of $10.5 million in the series A of funding. This first funding round has been led by Accel Partners, with the participation of First Round Capital, Harrison Metal, Forerunner Ventures, Lerer Ventures, Sam Lessin, Consigliere, Gary Vaynerchuck, Dave Morin, Stanford University Endowment and Andy Dunn.
The company, which is similar to other firms such as BeachMint, Blissmobox, Foodzie and Babbaco, has developed a subscription box of the month model which allows members to receive makeup and beauty products. This means that each and every month there are members who receive a box of premium samples of cosmetics from retailers such as Kiehl’s, Laura Mercier, Smashbox, Nars and Cargo which are sent to their homes.
But these are not the only advantages this site provides to its members as the company also delivers members pertinent tips and tutorials about the featured samples on the company’s site. Moreover, when a customer is persuaded that he or she wants to purchase a full-size product, he or she then also gains discount point for future purchases as long as they also provide a list of new members which are afterwards invited to join the club. The idea behind this type of promotional discounts is that of making client discover and appreciate new brands and new products which are available at a smaller price if bought on the site.
The element which makes Birchbox special is that the company sends a promotional package of products each month to all of its clients. Moreover, these promotional samples are chosen based on the preferences of each of the customers, by taking into consideration the profile filled in by the client at the moment of the opening of the account.
The company has been founded by Hayley Barna and Katia Beauchamp, both graduates of the Harvard Business School. Birchbox has been launched about one year ago at, by this moment, it already has a base of subscribers of about 45,000 persons, all of which are paying a subscription of $10 per month or of $110 per year. Moreover, the analysis of the most recent data shows that the company increases the number of subscribers by 50 percent every month since eleven months ago.
Theresia Gouw Ranzetta, from Accel Partners, declared the following: “The team has forged partnerships with some of the world’s leading cosmetic brands to give consumers a fun, monthly beauty sampling experience. We believe Birchbox has many opportunities for continued growth, and we look forward to aiding their success.”
There are numerous retailers who are interested in the “box of the month” type of promotion due to the fact that there are numerous women who want to try the products before purchasing them. The company is going to be even more successful than it is due to this fact and to the one regarding the fact that this type of promotion allows women to discover new products they might be interested in.
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