Transforming How We Manage Our Belongings
I’ll never forget the day Brian told me his mom’s storage provider had raised her monthly rates twice in one year. She had been a customer for over five years, never made a late payment and couldn’t remember the last time she walked through their doors. It felt like they were trying to fire their best customer. We set out to better understand the problem and found a $30 billion self-storage market with over a half-dozen billion dollar publicly traded companies that had not innovated in decades. Our goal became to deliver a much better customer experience at price parity with the incumbents. Our solution was to disrupt the industry with an on-demand model, one with a vertically integrated supply chain of movers, vehicles and warehouses.
We’ve made a lot of progress since our Seed round two years ago. Clutter has helped tens of thousands of consumers move and store what matters to them in Los Angeles, San Francisco, New York, New Jersey, San Diego, Seattle and now Chicago. We have more than 200 employees and built a supply chain of dozens of warehouses and hundreds of vehicles.
We’re excited to announce a $64 million Series C led by Atomico, with participation from our existing investor Sequoia, who led our Series A & B, and new investors GV (formerly Google Ventures) and Fifth Wall. With this funding, we are launching Clutter in more markets and continuing to invest in our proprietary infrastructure.
Continued support from our investors has allowed Clutter to offer the most convenient way to move and store what matters. Our professional movers help you safely store your belongings and our logistics platform manages and retrieves your items with the click of a button. Clutter employs people and technology to help cities be more efficient, freeing up space in homes and urban environments for new possibilities.
An Underserved Market
One in nine Americans collectively spends $30 billion/year on self-storage. This market is powered by you, your friends, your family and anyone else going through a stressful life event like getting married, having a child, moving or a death in the family. These life events typically cause us to store three types of items: 1. memories 2. assets and 3. let’s be honest, junk. The first two power the market. The perception of the self-storage market is a deeply negative one — not because the need isn’t real, but because the current operators provide very little value in return for 70% EBITDA margins.
Self-storage is an industry that’s never focused on the customer. Using its services comes with burdensome work and constant rate hikes. In exchange for $150/month (avg.), the incumbents actively try to fire you as a customer. The average operator will raise monthly storage rates 5–10% annually because their business model has a massive drawback: their supply is limited due to the CAPEX required to expand. Limited supply results in an average occupancy rate of 92% across 56,000+ facilities in the United States.
Clutter will never raise rates on our loyal customers because we have a more flexible supply chain. Far outside of city centers, we have a network of facilities in industrial zones where the real estate is plentiful and cheap. If we run out of space, we can easily and cost-effectively expand supply, allowing us to never turn down customers and in turn never raise rates. Additionally, we’re helping cities be more efficient, freeing up space in homes and urban environments to new possibilities.
Clutter is a place of many firsts: the first on-demand company to provide large item storage, the first to operate on both coasts, the first to reach positive unit economics and we now have almost twice as much capital as our nearest on-demand competitor. We’re excited to be launching in Chicago today and are actively working towards 50 more markets over the next five to seven years. Atomico, our lead Series C investor, will play a big role in this expansion as we eye international opportunities.
As Jeff Bezos always says, “It’s day one.” On this new Day One, we would like to thank our customers for supporting Clutter along the way. We have a ton more work left on your behalf, and we can’t wait to get started!