As Susan Feldman waited outside the Southwest Airlines arrivals terminal at Los Angeles International Airport in October 2008, she had a nervous feeling in her stomach, which she compares to blind date jitters.

Except this wasn’t your traditional blind date. Feldman was meeting Ali Pincus, her soon-to-be co-founder, for the first time. They had spoken over the phone after a mutual friend set them up to discuss the overlap of e-commerce and home goods, but they hadn’t met face-to-face. Feldman and Pincus both recall feeling a combination of nervousness and excitement.

This wasn’t your typical founder story, but four years later, their brainchild, One Kings Lane, would become a business with over 4 million members, with expectations of over $200 million in revenue for this year.

Feldman first started exploring the idea of applying flash sales to the home retail space in 2007. As a merchandiser, she was working in retail and observing the emergence of a flash-sale distribution model, pioneered by Vente Privee, and adopted by others, including Gilt. At the time, the model was mainly a vertical play in apparel, but she saw an opportunity to bring this to home goods.

This impetus was partially born out of personal frustration. She had recently moved to LA from New York and was in the process of decorating her home. Being a New Yorker, she was unaccustomed to the idea of driving from store to store to find individual pieces for her house. And she hated paying regular price for anything. During that experience, Feldman realized that in the home decor space there was no place to get deep discounts on designer goods.

As Feldman further explored the idea of flash-sale meets home decor, she realized the need for a more tech-savvy co-founder. Linda Stone, founder of BlogHer, set her up with Pincus in 2008, which brings us back to Feldman waiting at Arrivals outside of LAX.

From Strangers To Founders

Pincus says she couldn’t stop talking in their initial conversations about the possibility of starting the company because she saw how disruptive a company like One Kings Lane could be. And Feldman’s background in merchandising and creative seemed like the perfect complement to her business development and digital media skills.

The pair quickly found a good attorney, wrote a business plan, figured out who would host the website, hired designers to actually build the site, and then started taking meetings with vendors. Pincus and Feldman started pitching them in December 2008, and found that these companies were eager for ways to distribute inventory.

As the economy continued to implode, consumers tucked away their wallets, leaving retailers and brands with massive amounts of excess inventory. OKL was pitched as a channel where they could possibly sell these goods, but also maintain a luxury brand value.

This wasn’t going to be an Overstock or Walmart. Feldman realized that these brands wanted to move inventory quickly and discreetly, so that a brand wasn’t going to be featured on the website for weeks and months at a discounted price. That’s one of the reasons the site launched as a members-only platform initially. As Pincus tells me, it was about being at the right place at the right time.

From the start, OKL operated at warp speed for a startup. Pincus says her husband, Zynga founder Mark Pincus, gave her and Feldman advice that is still part of the OKL product culture. Mark advised his wife and her co-founder to be quick and nimble in seizing the opportunity. Feldman recalls that Pincus told her the first to market will win, the second will do well, and it will be tough for anyone after that. In other words, they needed to move fast.

They took Mark’s advice to heart. The fledgling startup outsourced all design, and web management so if it didn’t work they could just walk away. In 2008, funding wasn’t easy to raise, so they negotiated deals with partners. For example, the photographer who initially took photos of products for the site was paid with office space. They put thought into each meeting with vendors, bringing gifts like candles and always sending handwritten thank you notes afterwards.

Then there was the matter of naming the business.

Pincus tells me that she and Feldman wanted to use a street address for the site’s name. One Hawthorne Lane was one of Pincus’ favorite streets in San Francisco, but an advisor said that Hawthorne was a bit long for a natural Internet brand. Kings Road is one of Feldman and Pincus’ favorite roads in LA, and exactly five months after the two met face-to-face at LAX, One Kings Lane was launched in private beta to select friends.

Similar to other flash sales sites, the starting point for the sale was the email. Via an “ambassador program,” Feldman and Pincus reached out to friends and asked them to invite their friends, and their friends’ friends. They even incentivized sharing with gifts (i.e. an Hermes throw blanket) to help.

At launch in April 2009, OKL had exactly 5,000 members. The startup was then featured in email newsletter Daily Candy and went up to 25,000 members in a day. At the time, I sent the URL to my mom, an interior design junkie, who immediately called me with excitement about how she’d never seen Ralph Lauren candles and accessories with such deep discounts. My mom wasn’t alone in her enthusiasm. OKL immediately scaled a loyal user base and now has over 4 million members.

Curating Commerce And Attracting Investment

Along the way, Feldman and Pincus’ baby began to catch the eye of investors looking to get in on the flash sales e-commerce model. But as Pincus explains, pitching VCs on a niche e-commerce site was sometimes challenging, especially when it came to selling the Silicon Valley elite on the power of a site that sold candles, rugs, furniture and more. And it was powerful. “If investors didn’t get it, their wives definitely did,” Pincus recalls. In fact, Greylock partner James Slavet, who lead the firm’s investment in OKL in 2011, says he found out about the site through his wife.

The company originally caught the eye of Kleiner Perkins partners Bing Gordon and Aileen Lee in late 2009, and that year, One Kings Lane raised a round from Kleiner, First Round Capital and angel investor Reid Hoffman.

Lee said one of the things that attracted her initially was One Kings Lane’s design aesthetic. Between the logo, the look and feel of the site, and the communication they had with customers, One Kings Lane had a distinct vision, and more importantly, a soul, which is rare for an early stage company, she explains.

Lee also liked how the curation aspect of the site helps keep the merchant at the heart of the company. Hoffman agreed and explained that the site’s curated commerce strategy was what made OKL distinct when he was considering investing. “The physical world is made a lot more efficient by the electronic world but there is tons of noise, and startups have to figure out how to make people’s lives better. One Kings Lane uses curated commerce in a category that is fundamental to people,” he told me.

Hoffman views OKL as more than just a flash sales site, and believes the site is playing a role in making women’s lives easier by culling these home and lifestyle items. He believes that OKL is providing its demographic with a go-to site they will continue to need as long as they have a home and want to make it a more beautiful place.

One of the key parts to One Kings Lane’s curation strategy is Tastemaker Tag Sales, which allows well-known interior designers and celebrities to select sales of home decor items from around the world. As Pincus and Feldman explain, people don’t typically have access to an interior designer and this sale helps bring themed, styled collections to the masses.

Nathan Turner, a well-known, celebrity interior designer, has curated several Tastemaker Tag Sales and traveled with Feldman to India and other areas to help find items for these sales. Turner himself didn’t really understand how powerful the sale could be at first, as he admits he didn’t buy much home decor inventory online for his clients. But when the sale went live, and everything he curated and picked was sold out within a few hours, he quickly realized the power of OKL.

“It’s about taking brands in interior design and making them accessible to people. Not everyone lives in an area where they have access to these items, and OKL opens the door to this world,” Turner says. Now Turner says he uses the site to shop all the time for clients.

“When we launched no one was talking about curation but it is part of who we are and what we do,” says Feldman. Now One Kings Lane is seeing potential in adding editorial content alongside curated items to help members understand how to use or place an object in their home. The site has started featuring videos and pieces on how to fold a fitted sheet, or how to put a perfect bookcase together and more, contextualizing sales. Pincus explains that One Kings Lane wants to make members feel like they are on a treasure hunt every day.

Finding Focus Beyond Minimum Viable Product

One of the strengths of OKL is its niche focus and brand. Feldman explains that the site’s target is a woman, who loves her home, loves decorating and entertaining and tends to be in her early thirties to late fifties. Think of Feldman and Pincus as the bookends for their customer base.

For Feldman, merchandising was her bread and butter and while the site launched with decorative objects at first (i.e. candles); OKL quickly expanded to rugs, furniture, and other home decor after seeing the positive response from customers. At the start of the site, Feldman would actually print out pictures of each item to be sold on a given day and cut them up into grids to match the layout on the web page.

“From the very beginning, OKL has been about product and merchandising. We don’t just take anything that comes our way. We vet out every product, and vendor personally,” says Feldman. To date, the site has worked with a total of 2,000 vendors, says Feldman.

Tourance, a merchant that creates luxury throws, blankets, pillows and more, has been a vendor of One Kings Lance since 2010. Founder Phuong Thanh says that she didn’t know what One Kings Lane was when she came across the company at a gift show, but thought it was an interesting idea after explanation. In the past two years, Tourance has held over 10 events on the site. In fact, Thanh says that besides sales from the site, she’s received a significant amount of incoming inquiries from interested designers and stores who saw the items on OKL. And Tourance was able to triple revenue in 2011 thanks to One Kings Lane’s sales.

Even niche businesses draw competitors, especially when they’re on to something. And challenges have come in many forms for One Kings Lane. In the site’s early days, Feldman and Pincus outsourced web management, fulfillment and more. Then two years ago, they realized that it made more sense to create and manage these operations in-house. The company had to migrate from its vendors onto the newly-built platform, and create the infrastructure to support operations and the web platform in-house. When the company eventually switched over to the new platform a few years ago, they braced themselves for a drop in sales, downtime and more. But OKL managed to plug along as usual.

Gilt has been aggressively expanding into home; recently revamping the vertical with an acquisition as well as a complete redesign focused also on curated content and commerce. Fab, a flash sales site focused on design, is exploding and RueLaLa, HauteLook, Beyond The Rack and many others feature daily sales on home items as well.

Feldman is focused on the OKL vision, rather than the competition. She says the introduction of Gilt Home has not had an influence on One Kings Lane’s traffic or sales. She also sees Gilt, which also offers full-price items, as entering into a different market by moving away from discounted items. And while she says Fab is doing some interesting things in terms of e-commerce and content, she feels that its audience skews younger, and more male.

Feldman can focus on OKL’s merchandising and creative future, in part because of her strong, complementary partnership with Pincus, who is focused on business development and deals.
The team scored a huge development and marketing deal when it found itself as a significant part of the interior design reality show, “Million Dollar Decorators”. One Kings Lane also partnered up with actress Gwyneth Paltrow to promote her new cookbook and held an event in New York in her honor.

Feldman and Pincus have the freedom to focus on their passions, mainly because of CEO Doug Mack, who joined the company in 2010 and has been leading the company into triple digit sales growth ever since. Mack co-founded Scene7, a rich media platform provider for the e-commerce industry, which was eventually sold to Adobe.

Lee says that the secret of One Kings Lane is that it has one of the best teams in consumer Internet ecosystem. In addition to Mack, the site has also hired longtime eBay execs Dinesh Lathi as CFO, and Yulie Kim as head of Product.

Personalization, Mobile And The Future

The number of products offered on the site has grown 300 percent in the past year and Mack is looking for other high-leverage ways to grow the business, focusing on expanding talent and operations in two main areas—merchandising and technology. International expansion is also a potential huge growth area for the company and One Kings Lane is actively looking to build a global brand, but wants to turn this on in a meaningful way, he explains.

One Kings Lane also wants to expand its own channels for distributing products to its members. One recently launched feature is an eBay-like marketplace, which allows vendors and designers to post pre-vetted antique and vintage products on the site. However, there is no auction component, and all items have a fixed price. This, of course, expands the number and diversity of products on the site.

One untapped area for the business is personalization. It’s not easy for users to filter out items that aren’t interesting, or to search specifically for items that are. Over coffee with Pincus, Feldman, and Mack, I confided in them my weird, unnatural love for elephants. To my husband’s chagrin, I litter our apartment with books, figurines, art and even candles shaped like elephants. I would totally love to be alerted (by email or even a push notification) when an elephant-related good is featured on the site.

They all agree that personalization is inseparable from the future of curated commerce. Turning purchase data and other forms of intent into a personalized experience would provide more value for members so long as the team can preserve the serendipity that customers have grown to love.

Like any fast-growing startup, the question is where to focus a fixed amount of bandwidth and talent.

Mack says that personalization is on the list, but it will take time to build a much deeper infrastructure to store and retrieve the right data. Mobile commerce is another interesting opportunity, especially when you consider the opportunity to buy local goods from local designers. OKL has an iPhone app, but considering the loyal community of shoppers, and the personalization element; there is much more that can be done in this area as well.

While thinking deeply about the product’s future, Mack has been able to quietly scale the fundamentals. The startup, which Mack says is on track to be profitable in the next year or two, saw $100 million in sales last year and expects to more than double that number this year. More than 75 percent of sales come from repeat customers, which speaks to the loyalty and engagement of their customer base. Investors are looking carefully at these numbers.

And liking what they see. In the fall on 2011, One Kings Lane raised $40 million in new funding from Tiger Global Management, Institutional Venture Partners, Kleiner and Greylock, bringing the total amount raised to over $65 million. The site was valued at $440 million post-investment. Greylock’s Slavet brings the startup’s success back to Pincus and Feldman. “In this generation of e-commerce companies, the ones that have been successful have been those where the product sensibility emanates from the founders.” Pincus and Feldman are these founders.

But beyond their product and merchandising instincts, they have an enviable founder relationship that they describe as sisterly, more than collegial.

Since the day Feldman waited anxiously outside of LAX for her future business-partner, she and Pincus have not only been able to convert their passion into a highly-successful business, but also build a team that shares their love for merchandising and curation. Future entrepreneurs will learn from OKL’s product, but moreover, they’ll learn from its story.

Article courtesy of TechCrunch

Jetsetter, the exclusive travel community for globetrotters, seems to be on a roll. In recent days, the company has announced a dozen some new corporate partners, a handful of new sale formats to entice customers, and new distribution partnerships with high-profile sites like Kayak, The Economist and the vacation rental service HomeAway.

But while many think of Jetsetter as a flash sales for travel site, it’s been finding growth in other verticals: curated recommendations and personal service.

Launched back in September 2009, Jetsetter was the first flash sales site for travel, and has now outlasted much of its earlier competition. Unlike online travel bookings sites aimed at helping users find the cheapest flights and hotel rooms, Jetsetter’s angle is different. It targets not the everyday traveler, but the affluent one.

“Jetsetter customers tend to be six-figure incomes, college-educated professionals, and they tend to come from major urban markets – New York, San Francisco, L.A., Boston, Chicago,” explains Jetsetter CEO and founder Drew Patterson. “These are people for whom travel, and their experiences in travel, are an important part of their sense of self,” he says.

Targeting the elite customer has, so far, paid off. Jetsetter now has 2.2 million members, and has sold over half a million room nights worldwide. On the company’s website, members can take advantage of flash sales on travel, which offer savings of up to 50% off. The site runs anywhere from 20 to 40 of these sales per week. There’s also an online concierge service for bookings to help customers with travel planning.

The available inventory for travelers now includes over 650 hotels and resorts in Jetsetter 24/7, its full-price retail offering, which today accounts for over 30% of the company’s revenue. There are also nearly 300 homes in Jetsetter Homes, an increasingly popular vertical for the company, with 500 more in the process of being added.

“The non-hotel category of lodging has been exploding,” says Patterson, noting consumers’ interest in companies like Airbnb and Inspirato, for example. “Consumers are hungry for something other than hotels. It’s nice to have common space, a kitchen and living room versus bedroom,” he adds. But Patterson says that it’s still hard to book vacation homes online, not only because there aren’t many systems that support online booking, but also because of security issues.

“There are concerns and risks around financial settlement,” he says. “Typically you’re wiring funds with a homeowner, and you’ve never met this person before. You haven’t seen the product before. There’s a fair amount of risk and uncertainty involved in that.”

Jetsetter wants to step in to be the middleman for those transactions, taking on the financial risk, he says. They curate and vet the properties, even going onsite to visit them. That helps to establish trust with their users.

In addition to vacation rentals, Jetsetter’s personal travel planning offering executed 600 trips last year, despite having only launched in June. Today, there are approximately 400 trips in progress, which consumers booked thanks to the recommendations from Jetsetter’s network of over 200 correspondents – experienced travel experts and writers who visit the hotels and partners on Jetsetter’s behalf.

It’s this focus on curation, personalization and recommendation that’s proving to be a growing part of Jetsetter’s business. One third of the company’s revenue came from retail in January, as customers seem willing to pay full price when recommendations are involved.

Jetsetter is also going after customers through other verticals, specifically through new distribution partnerships like travel site Kayak.com which will see all 650 Jetsetter hotels made available for bookings, as well as with the vacation rental website HomeAway, which is testing Jetsetter integration with 150 homes. The company is also working with The Economist on an exclusive 6-week campaign of flash sales curated for the outlet’s readers, which includes distribution through The Economist’s homepage, newsletters, social media and mobile.

New sales formats have been recently introduced to provide a variety of experiences for Jetsetter customers. One, the “Mystery Monday” model, will provide deeper discounts to customers willing to book before learning the hotel’s name. It’s not all that unlike the blind bookings Priceline offers, but the hotels selected are of high quality, like The Ritz-Carlton, the Four Seasons, and The Surrey, all of which made an appearance in January.

There are also two-to-three night getaways called Jetsetter Weekends, focused on a collection of inns and B&B’s outside of Jetsetter’s top seven markets (N.Y., Boston, D.C., Miami, L.A., San Francisco, and Seattle). Meanwhile, new “Style Steals” offer discounted rooms at hip, boutique hotels. Jetsetter also says it occasionally runs sales for properties that prefer the voucher format like the Trump Hotel Collection, The Peninsula Hotels, Marquis Jets, and Groundlink, for example.

With all these sales formats combined, it seems that you can no longer call Jetsetter just a “flash sales site” for travel, even though it has an association with sister site Gilt Groupe, known for its flash sale properties.

“We obviously have a flash sale part of the business. That’s hugely important because that was our roots,” says Patterson. “But we also found that customers would write us early on and say, ‘I missed the sale. You emailed me something last week and it seemed great, but it’s not up there anymore. Just tell me what it was. It looked great and I want to go buy it.’”

“We said, Huh?’” he laughs. “But we had enough of these that it seemed like consumers really seemed to trust our judgment. That judgment is an important part of our business and our brand.”

And flash sales?

“Flash sales can inspire consumers and give them ideas for where they should go,” he says.

Article courtesy of TechCrunch

Flash sales giant Gilt Groupe is announcing major expansion plans to today, with the company’s e-commerce offering extending to over 90 countries. Additionally, Gilt will offer international customers free shipping for a limited time.

Gilt’s international sites will offer daily flash sales on women’s men’s and kids clothes and accessories, as well as home decor items through its Home vertical. Each sale contains a limited amount of inventory and lasts roughly 36 hours. Gilt says that nearly 50 percent of merchandise is sold during the first hour of a sale. The company’s recently launched luxury retail site for men, Park & Bond, will be made available to international customers next month.

Also starting next month, Gilt members outside of the U.S. will be able to shop and purchase from from their mobile devices through Gilt’s mobile website and iPad, iPhone and Android applications. Gilt says it is working with FiftyOne, an e-commerce platform that helps power international expansion and operations for online retailer, to enable international transactions, currency conversion, and international delivery.

International expansion is a big move for Gilt, so it should be interesting to see how the availability in over 90 countries around the world effects the company’s revenue. Gilt closed a $138 million round at about a $1 billion valuation last May and is on track to do $500 million in revenues this year. And an IPO may be in the company’s near future.

Article courtesy of TechCrunch

Flash sales giant Gilt Groupe has been steadily expanding its flash sales platform into a full-fledged e-commerce and curated content platform that reaches all major retail verticals including fashion, food, men’s clothing, and now the home. Today, Gilt is launching a brand new destination for home accessories and furniture, called Gilt Home.

While Gilt has been offering home goods via its flash sales site, this new platform includes a completely revamped site that adds editorial content and boutiques curated by renowned interior designers. In addition, the site offers four ways to shop: daily flash sales, “shoppable” editorial features, curated collections by top designers, and luxury collections.

Interestingly, Gilt Home will offer both flash sales, which cover designer goods at steep discounts over a limited time, as well as traditional full-priced merchandise that can be purchased at any time. The new site will include over 400 brands across multiple categories and from many designers including Missoni, Anichini, Frette, Matouk, and Michael Aram.

And brands previously only available to the designer trade will now be offered directly to consumers including William Earle, Stark, Kyle Bunting, Ted Boerner, Rotsen, Espacio and A. Rudin, with additional brands being added over the coming months. The launch includes over 2,000 products in the core assortment and new items will be added daily. New flash sales will continue to launch every day at noon.

One of the key elements of Gilt Home is access to designer curated content and pieces. Earlier this year, Gilt actually acquired Decorati, online platform for both interior decorators and consumers who are looking for professional design advice and guidance. Decorati’s founder, interior designer Shane Reilly,, is now a lead designer for Gilt Home. The new platform is also led by General Manager Jason Goldberger, Editorial Director Tom Delavan (formerly editor-at-large of domino magazine), and Divisional Merchandising Manager Alexander Ogof.

The designer boutiques incorporate a curated assortment of products, original lifestyle content and a “shop the room” experience. The product selection will include items from the designers’ own personal inventory and existing Gilt products, with a focus on items exclusive to Gilt.

Similar to Gilt Taste, the flash sales giant is also trying to bridge the gap between e-commerce and editorial with the launch of Home. Editorial content will revolve around how-to’s, trend reports, advice-related columns and in-depth features on designers.

The success of One Kings Lane has shown that a flash sales site for home décor, furnishings and accessories with a niche model can bring in revenue and a major valuation. The Kleiner Perkins-backed site also offers editorial content, and designer curated sales. And Fab.com, a flash sales site for design items, is also growing fast.

Clearly, there is definitely room for a few competitors in this space. And Gilt has shown that the blend of editorial, curated e-commerce and flash sales can work for certain verticals, exemplified by the company’s travel vertical Jetsetter.

Article courtesy of TechCrunch

Luxury group buying service Gilt Groupe is joining the mega-round bandwagon today with a new $138 million funding, led by Softbank, which took nearly half the round. Goldman Sachs, New Enterprise Associates, Draper Fisher Jurvetson Growth, Pinnacle Ventures, TriplePoint Capital and Eastward Capital also participated, as did existing investors General Atlantic and Matrix Partners.

Gilt Groupe operates a growing family of flash-sales sites, including the original Gilt, Gilt Home, Gilt City, Gilt Children, Gilt MAN, and Jetsetter. Members are offered discounted prices for a limited time, which drives demand. Gilt was one of the earliest flash sale sites, and now there are dozens of copycats. (HauteLook, a smaller flash sale site, was acquired by Nordstrom for $270 million last February).

Social commerce, in general, is attracting a lot of capital. Groupon raised $1 billion earlier this year and is on its way to an IPO. LivingSocial raised $400 million at a $2.9 billion valuation. Those two focus more on local commerce and require a certain number of consumers to commit to a deal before it goes into effect, whereas Gilt acts more like a merchandiser picking the products it thinks its members will want to buy.

Gilt is smaller in revenues than Groupon—on track to be more in the $500 million range than the $2 billion+ range that Groupon is in—but is growing rapidly. A big round like this is usually a precursor to an IPO, which is the next logical step.

Article courtesy of TechCrunch

The group buying industry has sprung out of nowhere over the past two years. A new report (embedded below) by daily deal aggregator Local Offer Network puts the U.S. gross revenues across the industry at $1.1 billion last year, and estimates gross revenues will grow 138 percent to $2.7 billion in 2011.

Groupon alone, according to other sources, is expected to bring in between $3 billion and $4 billion this year, up from $760 million last year, but those numbers are worldwide. If you figure at least half of Groupon’s revenues come from the U.S., you can get a sense of how much it dominates the market—capturing anywhere from about 50 to 75 percent of expected industry revenues this year.

But that still leaves as much as half left over for other group buying sites, such as LivingSocial and Gilt Groupe. And those are just the big dogs. Local Offer Network tracked 90,000 deals across 322 group-buying sites in the U.S. since January, 2010. And that doesn’t even include so-called private sale sites.

In the first quarter of 2011, it tracked 117 new deal sites, which is about double the number of entrants a year ago. The churn rate for these sites is about 25 percent, meaning that is how many fail, are bought, or go dormant.

The number of deals being offered is also accelerating. Last year, there were about 63,000 deals in the U.S. through group buying sites. In the first quarter of 2011, there will be an estimated 40,000. Groupon accounts for less than half of those published deals.

The categories that dominate are Food and Drink (27%), Beauty, Spa & Massage (19%), Fitness & nutrition (7%), Sports & Recreation (7%), and Home Products & Services (5%). The biggest cities for daily deals are Chicago (where Groupon is based), New York City, San Francisco, Boston, and LA.

Local Offer Network gets all of this data in a variety of ways, including business relationships with about half of the group buying sites, data feeds, APIs and web crawlers.

Article courtesy of TechCrunch

In one of the larger exits so far in the flash sales business, retail chain Nordstrom has acquired flash sales site HauteLookfor $180 million in Nordstrom stock and three-year earn-out of up to $90 million. HauteLook has raised $41 million in funding.

Thanks to the immense popularity of members-only, online sample sales, HauteLook has grown to 4 million members since launching in 2007. The site offers massively discounted sale events in women’s fashion, men’s fashion, accessories, kids’ clothing and toys, travel and home and beauty.

The basic idea behind the flash sales model is this: designers ad retailers, such as Marc Jacobs or Versace, place excess inventory on a sale site at 50 to 70 percent discounts over a several day period. The sales are private, available only to members, with upcoming sales from brands announced via emails. You can get invites from other members or request invites via the site.

The flash sales space is definitely competitive; and the amount that HauteLook sold for isn’t entirely surprising. Two years ago GSI Commerce bought RueLaLa in a deal valued at $350 million. Gilt Groupe, has been raising huge amounts of money, growing its user base at a rapid pace and turning a strong profit. In December, Gilt raised another $15 million, bringing the company’s total funding to nearly $100 million. At one point Gilt was valued at $400 million but that number has surely increased over the past year. And an IPO could be in the near future.

One Kings Lane, has also recently raised a large amount of money and is growing like a weed. And there are a number of independent players like Ideeli, BeyondTheRack and others who are still growing at a fast clip.

The concept has even attracted retail giants like eBay, Saks and Neiman Marcus, which are now jumping on the bandwagon to offer their own private sales, a market which Nordstrom clearly wants to enter the space. I wouldn’t be surprised if other larger retailers snap up niche, smaller flash sales sites over the next few years.

Article courtesy of TechCrunch

Gilt Groupe has made a name for itself, particularly in the United States, for operating a successful flash sales site that offers its members products and experiences at heavily discounted prices for a limited period of time.

Now, the company is turning to traditional e-commerce for its next trick.

Gilt this morning announced that it will be debuting a full-price men’s business as a dedicated website in Summer 2011 (to coincide with Pre-Fall 2011 collections).

The company says the new site, the name of which hasn’t been disclosed yet, will offer a selection of men’s apparel, accessories, athletic gear, gadgets, and more. Aside from a “state-of-the-art shopping experience”, the site promises to throw editorial content into the mix.

John Auerbach, currently General Manager of Gilt Groupe’s $100 million+ Gilt MAN business, will be President of the new site. Brooke Cundiff, formerly Director of Men’s Brand management at Gilt rival Rue La La and Associate Divisional Merchandise Manager of Saks Fifth Avenue, will become Divisional Merchandising Manager of the new business.

Brian Kalma, formerly head of user experience at Gilt and prior to that head of user experience and web strategy at Zappos, will be in charge of user experience for the new site.

Gilt Groupe says the mixture of brands on the full-price site will be similar to the curated assortment currently available on Gilt MAN, and items will live on the site according to seasonality in contrast to its current flash sales model.

Kevin Ryan, founder and CEO of Gilt Groupe in a statement says the company has already signed up 400,000 male customers and 350 brand partners to date.

Online fashion retail stores seem to be having quite an upswing of late, with Google launching Boutiques.com and eBay running a one-stop-shop for all things fashion.

Article courtesy of TechCrunch

I’m a big fan of members only flash sales sites; which take a Gilt-like model to sell high-end clothing, hotel rooms, home goods and more at 50 to 70 percent off retail prices. So when decided to try out Exclusively.In, a members-only shopping site for fashion, jewelry and home decor from Indian artisans and designers I was intrigued to see if a niche-site could draw a fair amount of traffic from a broader audience. It looks like Accel seems to think so—Exclusively.In has just raised $2.8 million from both Accel Partners and Helion Venture Partners.

The site features high-end traditional Indian apparel as well as more modern, Indian-inspired clothing. And the startup includes scarves, jewelry, handbags, crafts, paintings, photography and other home goods made by Indian designers.

Since Exclusively.In’s launch June, the company’s co-founder and CEO Sunjay Guleria says the site has experienced strong demand from a broad base of consumers, not just the Indian diaspora, as “Indian-infused” fashion and decorations go mainstream.

While Guleria declined to name how many members the site has, he did say that over 65 percent of its members make repeat purchases with the average purchase hovering around $250 ion the site. Currently Exclusively.In ships orders directly from India to the U.S., but will eventually expand to Canada, the U.K. and India in early 2011. The site is also looking to expand to other verticals, such as travel. Over the past few months, Exclusively.in has featured deals from the Taj Hotel Group for the company’s hotels all over the world.

It’s certainly interesting to see that niche flash sales sites like Exclusively.In are growing and finding a loyal userbase, and a vote of confidence from well-known investors. Gilt’s revenue was expected to reach close to $500 million this year, so even as a niche site, Exclusively.In could pull in decent sales. Or it could be a possible acquisition target.

One thing is for sure. My wallet is a little lighter after my visit to the site.

Article courtesy of TechCrunch

Beyond the Rack, a members-only sample sale site, has raised another round of funding today. The startup has just announced a $12 million round of funding from Highland Capital Partners and BDC Venture Capital. This brings the Beyond The Rack’s total funding to $16.5 million.

Similar to Gilt Groupe, HauteLook and Ideeli, Beyond the Rack is a members-only shopping site that offers steeply discounted (from 50 to 70 percent) on designer brand clothes, accessories and other goods. The site says that its revenue growing over 30 percent per month and currently has 1.5 million members, doubling its userbase from six months ago.

Beyond The Rack launches up to eight new sales events every day, with each event only lasting a few days. The model has done fairly well in the space, with similar sites seeing rapid growth. There’s the rumored acquisition of European sample sale site Vente-Privee by Amazon for an estimated $3.01 billion. And sample sale sites Gilt and Ideeli have recently raised large amounts of funding. While the flash sales space is full of worthy competitors, clearly there is room for a number of sites to operate.

Article courtesy of TechCrunch