Why we invested in Returnly
The global startup solving ecommerce’s returns problem
Today, Returnly announced their $19M Series B round, which was led by Craft Ventures and with participation from Max Levchin, the PayPal cofounder who currently runs Affirm. We participated alongside other existing and new investors. Backing diverse founders who are using software to tackle large, global problems and markets is at the crux of TheVentureCity’s investment thesis and Returnly fits right into that.
Returnly streamlines the returns process for ecommerce retailers and turns those returns into repurchases via its instant refund offering. Returns are a major pain point for both retailers and consumers alike. In the U.S. alone, Statista estimates return deliveries will cost $550 billion by 2020, a figure that doesn’t include restocking expenses or inventory losses. As many of us have experienced firsthand as customers, this process is often lengthy and inconvenient, especially for ecommerce returns. For retailers, returns are an unpredictable cost center that require building out reverse logistics operations. Returnly helps turn a loss generator into a value creator for them.
We like Returnly because it is tackling a large, global problem with a unique solution that has a clear, positive ROI for its customers. Additionally, Returnly perfectly embodies our cross-border approach to investing and company building. The founder, Eduardo Vilar, is originally from Spain and while the company is headquartered in San Francisco, their core engineering and AI team powering their machine learning underwriting for instant refunds is distributed between Madrid, San Francisco, and Chicago. This allows Returnly to bring market leading talent onboard while operating more leanly than its strictly SF-based or US-only peers.
Above all, though, our favorite part is the ‘how we met’ story. Our founder, Laura González-Estéfani, first met Eduardo in the beautiful, serendipitous way that two strangers connect when they realize they are a shared minority. Among the sea of homogeneity in the Bay Area, Eduardo and Laura were walking through the SF Zoo with their crying children, trying every possible way to calm them down — each in their native Spanish tongue. Hearing each other, the two immediately connected (once their respective children calmed down) and a friendship was born. Laura recognized Eduardo’s passion and talent for driving change and efficiencies in the world of ecommerce and provided him with his first angel investment for Returnly while she was still a Facebook employee. Several years later, TheVentureCity was born and we co-led Returnly’s Series A alongside Mundi Ventures.
We’re beyond excited to continue to support Eduardo and the rest of the Returnly team in this next phase of growth.