Data platform provider SoundCommerce has raised $15 million in Series A funding, money that will be used to scale the business and build out a client roster that already includes Constellation Brands, FTD/ProFlowers and jewelry brand Mejuri, among others.
Developed to help consumer brands and retailers optimize and scale their omnichannel and ecommerce operations, SoundCommerce integrates data from siloed sources across a company to give decision makers a comprehensive, real-time view of the business.
SoundCommerce will use the funding to invest in technology and double the size of its team, which currently includes 30 employees. The company also plans to scale its marketing, sales and channel partnership activities.
In 2020 ecommerce accounted for 14.4% of all retail sales, a 32.4% increase from 2019, prompted in large part by the pandemic, according to eMarketer. Direct-to-consumer sales were already on the rise even before the emergence of COVID-19, but the dramatic shift in consumer spend toward online channels saw more retailers than ever before launch into the space.
“The problem that exists, regardless of the size or profile of the brand, is that the operating complexity of the DTC model is super high,” said Eric Best, CEO of SoundCommerce in an interview with Retail TouchPoints. “The typical approach is to start with the brand, the product and the marketing rather than data and operations. But as these brands start to scale, they become aware of the importance of real-time and predictive data and decisioning and the importance of being able to efficiently scale their operations. So decisions that might not matter in the early days, like where should I stage inventory across the country or across the globe, becomes super important at the point at which you need to turn a profit to survive and grow.”
That’s where SoundCommerce comes in, typically at the $10 million to $20 million revenue range, at the point when a brand needs disparate data tools to start working in concert.
Emergence Capital led the Series A funding round, and its General Partner Joe Floyd will join the SoundCommerce Board of Directors. “Against the backdrop of 2020, competitive pressure is greater than ever for consumer brands, and data capability means competitive advantage,” said Floyd. Existing investors Defy Partners and Voyager Capital also participated in the round, which follows on the $6.5 million in funding the company raised in 2019.
“The thesis under which they’re investing is that oftentimes technology providers like us build a horizontal solution, managing data in a data warehouse for every vertical industry, for every type of customer,” said Best. “We’re a very different investment for them in that we’re exclusively focused on this one vertical industry, namely consumer brands and retailers. We’ve got a very narrowly defined set of use cases that we want to support over time.”