Zulily, Off to Fast Start in Private Sale E-Commerce, Raises $6M More from August Capital, Maveron

8/4/10

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one or two brands. You see different brands every day—it’s part of what gets people excited to come back and see what we have.”

And though Cavens says the company is not releasing any official numbers regarding its finances or its membership, he did comment on the return rate.

“Of people that have bought—and it’s not a metric we have generally shared—we’re seeing almost 40 percent of consumers that have bought for us come back and repeat again,” Cavens says. “For being six months old, that’s a very high repeat rate…they’re coming back again and again to buy.”

And when compared to direct competitors The Mini Social, founded in 2008, and New York-based bTrendie, founded in 2009—also in the private sales market for moms, babies, and kids—Cavens points to an advantage his company has in web traffic. According to web analytics service Compete.com, Zulily’s traffic surpassed the other two within weeks of launching. As of June 20, Compete’s statistics show that Zulily’s site brought in an average of 217,544 unique visitors a month, followed by bTrendie at 54,929, and The Mini Social at 26,198.

“These two were both before us, and we’ve run by them in terms of traffic to be considerably larger,” Cravens says. “We’re very pleased with the momentum we’ve got, and we’re not seeing the competitive set keeping up with us at that point.”

As for the new funding, Cavens says the company wasn’t in need of more financial support when August approached it.

“We weren’t initially going out and looking for funding,” he says. “But we found a great team with August, and we felt like they really understood the team here, so they made us an offer, and really put some gas in the tank that will let us take off.”

Zulily plans to use the additional funds to continue to improve the experience for both consumers and retailers.

“In retail, it’s doing 1,000 little things right and not necessarily going after one big thing,” Cavens says.

One of the items on the Zulily ‘to do’ list: rolling out a mobile functionality that would allow brands to “engage more deeply with members.”

“I think there’s a great opportunity in mobile here when the sales go live. The moms may be running errands or dropping the kids off at school,” he says, adding that with mobile capabilities, they’ll be able to follow—and purchase—deals on the site from anywhere.

The company also will be hiring new staff both on the tech development side and the buying department, so that it can expand the number of brands represented and the number of events. And although Cavens couldn’t comment on specific numbers, he did add the team has grown rapidly—from four employees back in December, to more than 40 now—and he fully expects that trend to continue.

“When I look a year out it’s reasonable that we’ll be double what we are now,” he says. “We’re growing faster than we expected.”

Thea Chard is a correspondent for Xconomy Seattle. You can e-mail her at theachard@gmail.com or follow her on Twitter at http://twitter.com/theachard. Follow @

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