- Drop — a personalized mobile rewards platform — announced it raised $44 million in Series B
Toronto-based Drop — a personalized mobile rewards platform founded by Derrick Fung and Darren Fung — announced it raised $44 million in Series B funding to further its mission of rewarding consumers by delivering relevant deals right to their smartphones. This round of funding was led by HOF Capital. Returning investors New Enterprise Associates (NEA), Sierra Ventures, and White Star Capital. And Royal Bank of Canada is joining as a strategic investor.
How does Drop work? Drop allows users to earn cash rewards when they make purchases from over 300 merchant partners. With Drop’s free app available on iOS and Android, it builds a personalized rewards experience from over 300 partner brands. And users earn points when they shop using the app and can redeem their Drop points for gift cards at places like Uber Eats, Starbucks, and Sephora.
Users have collectively earned nearly $19 million in rewards on their everyday purchases. And Drop connects brand partners with millions of millennial shoppers who have demonstrated an interest in their brands. With Drop, brand partners are able to acquire, nurture, and reward hard-to-reach shoppers. And the company is also able to more fully understand their customers and competitors and increase the effectiveness of their marketing spend.
“By applying machine learning to our users’ transactions, we are able to surface relevant, personalized offers for consumers as well as help marketers gain a more complete understanding of their customers and competition,” said Drop CEO Derrick Fung. “This is a big win for the brands on our platform, and also for the millions of smart shoppers who are looking for ways to earn rewards and level-up their shopping experience.”
Drop has driven more than $350 million in sales for its partners so far, which includes Postmates, Expedia, and Glossier. This round of funding comes on the heels of Drop’s recent acquisition of Canopy Labs — which is a Y Combinator-backed predictive analytics software company focused on improving and optimizing customer journeys.
The investment will enable Drop to continue to innovate its user experience, expand its machine learning capabilities, and drive further value for its users and partners. And it will also help accelerate Drop’s fast-paced growth — which includes adding new partners, users, and features, continuing to expand its Toronto and New York teams, and entering new markets including the UK and Australia.
“Derrick and his team have built an innovative product with best-in-class user growth and engagement,” added HOF Capital Co-Founder and Managing Partner Onsi Sawiris. “We are excited by the new opportunities Drop is creating for both consumers and brands and are proud to partner with them as they re-define the rewards space.”
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