Returnly, a San Francisco-based post-purchase based company that gives retailers a competitive advantage, has raised $19 million in Series B funding. This round of funding was led by Craft Ventures — which is a venture capital firm co-founded by David O. Sacks (Yammer founder, Geni.com founder, and former PayPal COO). Max Levchin — CEO of fintech company Affirm (and Glow co-founder, Slide founder, and PayPal co-founder/former CTO) — also participated in this round.
Plus existing investors also joined this round. With this round of funding, Returnly is going to help thousands of retailers compete effectively against Amazon. Specifically, the funding will help Returnly grow its merchant services and expand product offerings so that additional retailers can elevate their online brand, increase loyalty, and drive revenue throughout the post-purchase experience.
“David Sacks and Max Levchin changed the commerce industry forever with their revolutionary work at PayPal,” said Returnly founder and CEO Eduardo Vilar in a statement. “To attract a group of investors that created industry-defining companies like PayPal, Affirm and StubHub is an enormous validation for the solution we’ve developed to fix this inherently broken returns model. With their support, we’ll be able to accelerate growth and help merchants everywhere extend a seamless brand experience to one of the most important brand touchpoint consumers have: the return.”
Returnly works with retailers and brands to the remove the friction involving product returns. And Returnly enables shoppers to buy again using return credit before shipping the original items back. And the company settles the new order in real-time so it takes the product return risk. To handle this type of business model, Returnly developed a turn-key solution for large scale retailers along with hosted and fully personalized end-customer touchpoints such as order and returns tracking, online returns, and exchanges.
“In the age of Amazon, shoppers expect every interaction with a brand to be fast and easy – including post-purchase,” added Craft Ventures general partner Jeff Fluhr — who was previously the CEO and co-founder of StubHub. “Returnly gives shoppers the instant and seamless returns experience they have come to expect. For the thousands of retailers competing with Amazon, Returnly levels the playing field while increasing revenue and improving customer loyalty.” In conjunction with this round of funding, Fluhr is joining Returnly’s board.
As online sales in the U.S. are growing at 15% year-over-year and is expected to surpass $600 billion this year (eMarketer), return rates vary depending upon product types with 25-30% of online purchases return on average. This is nearly three times higher than offline purchases. And it creates a market worth up to $180 billion where retailers can improve experiences and drive repurchases in order to create a loyal customer base.
“Successful retailers focus relentlessly on improving the customer experience, and streamlining payments continues to be a very important part of their strategy,” explained Levchin. “For much of my career I’ve focused on improving payments at the point of sale, but what attracted me to Returnly was their shrewd focus on the post-purchase experience. Post-purchase is an increasingly important component of the shopper lifecycle, and Returnly is helping retailers optimize it.”
