Loop Grabs $10 Million to Make E-Commerce Returns Easy as 🥧
If you’ve been to a Target or Walmart the day after Christmas, or sent back a product you purchased online, you know how tedious returns can be. It’s especially tough for e-tailers that spend so much time processing returned Snuggies and Ninja Blenders that little time is left to connect with dissatisfied customers and build (or maintain) brand loyalty.
🛒 🛒🛒 However, one company is throwing all of e-commerce for a Loop by addressing perhaps the biggest and most overlooked opportunity for online merchants: the post-purchase journey.
Loop, an e-commerce SaaS platform focused on building Love after Purchase™, just raised 10 million big ones to redefine post-purchase customer engagement and drastically improve the efficiency of returns. The round, featuring FirstMark Capital on lead vocals, Ridge Ventures on guitar, and Lerer Hippeau on drums, will help scale Loop’s flagship product, Returns, that cuts the time merchants spend managing returns by nearly 90 percent. That is a serious time-shave for merchants who are scratching and clawing to out-duel competitors and keep pace with his majesty, Lord Bezos Prime.
Laggy return processes can be attributed to the existing returns infrastructure that was built for the pre-internet era, back when Mom Jeans were in vogue, merchants had fewer returns, and commerce happened mostly in one direction. But because today’s click-and-done buying experience makes shopping easier than ever, returns and exchanges will only increase and force brands to adjust accordingly. Returns shipments alone will cost $550 billion by 2020, up more than 75 percent from the four years prior, and if that doesn’t confirm that returns are the new normal, these numbers may do the trick:
🔹 41 percent of consumers buy variations of a product with the intent of returning
🔹 42 percent have returned an online purchase in the last six months
🔹 89 percent have returned an online purchase in the last three years
Ridge is proud to back a solution to this problem in Loop, a company that not only realizes the need for an Extreme Returns Makeover but understands that modern brands see purchases as the first step in a long-term relationship with consumers.
Loop provides a 360-degree view of post-purchase logistics and fully automates returns for merchants, who see a 50-percent shorter return cycle. The skinny? More conversions, more refunds turned into exchanges, more revenue. In fact, Loop customers have seen a 60-percent conversion rate from refunds to exchanges in certain verticals — a welcome sight for direct-to-consumer companies that lose 20 percent of sales to returns.
🎖 If you know Ridge, you know we dig founders who have been there, done that, and are doing it again. Yes, Loop has an amazing product and the stats to back it up. They also have an A-Class team led by CEO Corbett Morgan, who built fintech solutions for Klarna, among other impressive doohickeys; President and COO Jonathan Poma, who learned the ins and outs of e-commerce from running Rocket Code, an agency that created apps for the nascent Shopify ecosystem, including Loop; and founding engineers, Brandon Schmidt, Steve Kemper, and Chris Pinchot, who launched the product from Rocket Code at day 1.
This pedigree will come in handy as Loop continues to own and redefine life after the Buy button. Consumerism is fundamentally changing, and we’re excited to support a company that is ushering in the next wave of modern commerce and making life easier on brands like BuzzFeed, Allbirds, and even our friends at Chubbies — who, by the way, originally introduced us to the Loop troop.
Needless to say, we are pretty happy with our investment and don’t anticipate a return any time soon (except on the balance sheet). For more information, check out TechCrunch’s coverage of Loop’s funding news.
🎉 Congrats, Team Loop!
