Two weeks into 2017 and the Investment Tracker is showing some steady motion, with total fund flows comfortably in the low triple-digit range. This past week, the tally stood at $349 million, with FinTech at almost $238 million of that.
Nearly one-third of that $349 million can be traced to a single deal, as Accel Partners and other investors ponied up $100 million to Funding Circle. That capital announcement comes despite fears over what Brexit might mean for the FinTech sector across the pond in general, and the peer-to-peer lending sector continues to grow — by some estimates, at about 50 percent annually.
Snapdeal — which has been in the news as the firm looks to push growth rates higher this year and, amid India’s cash crunch, inked deals to deliver cash in the country — helped invest as much as $57 million in FreeCharge, according to regulatory filings. FreeCharge had been in talks to raise funding with, and from, firms as diverse as PayPal and SoftBank.
IZettle garnered interest from investors, too, receiving roughly $63 million, as the Swedish FinTech firm extended a Series D financing and received debt financing from Victory Park Capital. That funding will go towards boosting POS business in Europe and Latin America. In addition, the company announced that there will be a new CFO, Maria Hedengren.
Regionally speaking, on a trailing basis over the past four weeks, Europe has received the lion’s share of investments, at 51 percent, dwarfing the 21 percent tally tied to the United States.
Reverse Logistics: Optoro Clinches $30M Series D
End-to-end reverse logistics SaaS solution provider Optoro Inc. recently got a funding boost from UPS, rounding out the company’s $30 million Series D. Other participants in the funding round included Kleiner Perkins Caufield & Byers, Revolution Growth and Generation Investment Management LLP, among others.
Founded in 2010, Optoro evolved out of another business that Cofounder and CEO Tobin Moore started years earlier while in college — an eBay dropoff store called eSpot in the Georgetown neighborhood of Washington, D.C.
“We built up technology to handle receiving traded-in goods from consumers who wanted to sell online,” Moore said. “They would leverage our high ratings and our automated system to get the highest possible price for their goods.”
As that business grew, Moore said he saw a greater opportunity for his technology in the burgeoning eCommerce space. “At the start of eCommerce, retailers focused on innovation happening in the forward supply chain,” he said. “But they didn’t look at the back end, what happens when the goods come back.”
Moore said that, at the time, retailers were still relying on antiquated reverse logistics systems that were low on returns and high on waste. Statistics from the National Retail Federation show that returns cost U.S. retailers $260 billion in lost sales last year.
“Around 9 percent of all goods sold in the U.S. eventually get returned,” Moore said. “In eCommerce, the rate is much higher, and a lot of it gets thrown away. The retail industry creates 4 billion pounds of waste per year in the U.S. We realized that we could actually help make an impact with our technology.”
Nearly from the moment a returned item shows up in a distribution center, using Optoro’s solution, the software is at work. “They scan the UPC,” Moore said, “and our system immediately identifies the item, who sent it back, what the history is. Then, it informs the warehouse worker how to test and grade the product.”
Workers test and grade the headphones and enter the condition information into Optoro’s software, which then analyzes the data and advises the company where the item should be sent to generate the most value for the retailer.
“If it’s new and sealed,” Moore said, “the system would determine whether the item could be sent back to stock. If it’s open box and they don’t carry it in stock, it will look through secondary markets — our direct-to-consumer website BLINQ, our site for micro-entrepreneurs BULQ, eBay or Amazon.”
Based on the product, its condition and the potential value it could generate for the retailer, Moore said the system also considers selling wholesale, B2B overseas, donating the item or selling it to a recycler.
Optoro’s software handles the marketing and pricing of the item, generates content to describe the item, sells the item on the different sites and handles the payment collection, Moore said. It also sorts through different carriers to determine how to most effectively ship the product to the consumer. Finally, the software generates the shipping label.
Before Optoro, Moore said that retailers could expect $0.20 on the dollar for returned goods. With Optoro’s reverse logistics solution, retailers are able to see $0.40–$0.70 on the dollar for returned items. Additionally, Moore noted, using Optoro’s solution can help reduce the waste generated by retail returns by over 50 percent.
As of now, Optoro works with over 20 major retailers, Moore said. To date, Optoro has raised $119.2 million in five funding rounds. With UPS joining the latest round, the two companies are gearing up to put out a joint offering.
“With UPS,” Moore said, “we see a partner that has world-class logistics capabilities and is already working with the top 500 retailers and is touching over 1 million returns each day. Let’s pair our software and marketing capabilities with their world-class logistics network, and we can offer an unparalleled end-to-end services solution.”
In addition to working with UPS, Moore said Optoro has ambitions to branch out into the trade-in market. “Many don’t even think about the environmental impact on the the reverse end,” he said, “what happens to items once you’re done using them. One of the things in the future we’re interested in getting involved in is the trade-in market to create a more circular economy.”
Moore said Optoro wants to work to ensure that whatever items consumers are done using, whether in the returns space or the trade-in space, can be put to good use. “If you’re buying a new TV, turn in your old TV; if you’re buying a new laptop, turn in your old laptop. We can help find it a new home — get it to someone who couldn’t afford it new or get it to recyclers to be put back into new items.”