A bit more than $783 million in investment activity marked last week’s fund flow. The majority, at 72 percent, came from FinTech.
Within FinTech, banking held sway. The biggest transaction in that space and, indeed, across all investment activity, came from Ant Financial’s $200 million investment in Kakao Pay. This marks Ant’s expansion into Korea.
The second largest and also triple-digit deal came as B. Riley bought FBR for $160 million in a move that strengthens the former’s brokerage business. The deal represented a roughly 25 percent premium to FBR’s closing price of its common stock prior to the transaction.
Rounding out the triumvirate of triple-digit deals, Route 66 Ventures invested $130 million in Sunlight Financial. That deal helps Sunlight expand its solar loan activities and partner with additional installers.
Looking at the geographic concentration of activity, the U.S. was the most active region, with 47 percent of activity, followed by China at 41 percent.
OrderGroove Funds Frictionless Commerce With $20M Series C
The retail landscape is changing fast in the face of new technologies and shifts in buyer behavior and consumer demand.
“Preferences have shifted,” said Greg Alvo, cofounder and CEO of OrderGroove. “Our belief is that the shopping cart is dying. Consumers no longer want to just be transacted with — consumers want to be in relationships with the retailers and brands that know them well.”
OrderGroove is in the business of building these relationships. Founded in 2010, the company offers a Subscription-as-a-Service (SaaS)-based subscription technology platform and builds tools for brands and merchants looking to add subscription services to their retail repertoire.
Alvo equates the move to subscription services in retail to how the software industry transformed model not too long ago, moving from dedicated software offerings to SaaS.
“You saw Adobe going from a download of Photoshop to monthly payments to use the software,” he said. “The B2C industry is going through that exact same transformation now.”
OrderGroove started off with static plans for clients to allow subscribers to subscribe, Alvo said. Since then, the company has evolved to allow for more dynamic, customizable and personalizable plans based individual consumers’ behaviors, history and consumption patterns.
Current clients of OrderGroove, who use the startup’s consumer SaaS and APIs to develop subscription and other user experiences, include brands such as Walmart, GNC, Toys “R” Us and Nestle. Alvo used Nestle to describe what OrderGroove’s platform and services allow major brands to accomplish.
“Nestle’s Purina brand launched a subscription service on our platform called Just Right Pet Food,” Alvo said, “which brings you through a guided selling process. They ask you five to 10 different questions to land you on a personalized plan for your dog.”
Based on input, the process recommends a specific delivery intervals. From there, OrderGroove’s platform provides clients with subscription syndication management, user behavioral insight, campaign analytics as well as billing service.
“That’s one use case,” Alvo said. “Our platform takes care of thousands of different customer use cases to ensure that our clients can deliver on the commitment they’ve made to that subscriber.”
OrderGroove announced back in mid-January the close of a $20 million Series C round of venture funding led by National Securities Corporation.
This most recent round brings OrderGroove’s total funding to some $37 million from previous backers like Lerer Hippeau Ventures and SWaN & Legend Ventures, among others — including Scott Booth, the founder of Alibaba backer Lead Edge Capital. Alvo noted that Booth had recently joined OrderGroove’s board of directors.
OrderGroove will put the most recent round of funding to work in a few different ways, Alvo said. First, the company plans to double down on what’s working — funding more subscription-based business models and introducing new types of models that leverage OrderGroove’s API.
“We want to allow our clients to build whatever type of experience they want in whatever channel they want,” Alvo said, adding that while OrderGroove started online, the company has recently been working to expand its services into physical retail stores.
Since a majority of commerce is done offline, physical store locations still represent significant assets for retailers and brands. If omnichannel retailers can innovate quickly, they can take advantage of the 90 percent reach they still have, Alvo said. For OrderGroove’s part, the company is working to enable physical stores to consult with consumers and guiding them through a regimen, plan, bundle or other subscription services to give them a major advantage over the competition.
“Then you control that subscriber across all channels,” Alvo said. “They’re now circling your brand. So we’re taking the same platform that’s online offline, and we’re leveraging physical assets that have been around for many years but just augmenting the consumer experience to match 2017 and beyond.”
Moving forward, Alvo said that the recent funding round will allow OrderGroove to move beyond just dealing in subscriptions.
“Much in the same way the future of driving isn’t driving — it’s via driverless cars,” Alvo said, “we believe the future of shopping isn’t shopping, it’s via forms of frictionless commerce.”
OrderGroove is working to introduce a number of frictionless technologies as a means to cut down on the length of traditional paths to purchase and repurchase for consumers. The recent Series C will work to fund the company’s innovation labs, research and development teams to find new technologies that allow OrderGroove’s clients to not only defend their market shares, Alvo said, but get on offense as well.