d2c vc funding

Quarterly D2C VC Funding

The third quarter of 2019 was a mixed quarter for direct-to-consumer brands (D2C companies) raising venture capital. While the overall amount of funding was solid, the number of companies raising was down.

 

Overall $2.2 billion dollars in funding flowed from a variety of early and late stage VCs, slightly down from Q2 2019, but a noticeable year-over-year pop from the $1.9 billion raised in Q3 2018.

 

The overall number of companies that raised capital was 161, which is lower than the 197 in the Q2 of 2019, and less than the 171 from Q3 2018.

 

Chart: Direct to Consumer Funding by Quarter

 

 

D2C funding

 

DTC Funding Trends

 

The last quarter of 2018 was clearly a magic quarter, both in terms of the number of companies that raised cash and the amount of capital raised. Since then, the trend has been pretty flat, with the amount of VC $ going into these direct to consumer companies hovering between $2.2 billion and $2.4 billion. This most recent quarter is interesting, in that the number of companies decreased – we’ll see if the number (and amount of $) goes up as more data is collected, but our current hunch is that it was possibly the beginning of a light slowdown.

 

Key Direct-to-Consumer Funding Rounds

 

So which of the direct-to-consumer startups who got funding seem the most promising? 

 

Looking at the largest funding rounds in Q3, we see a few names you probably already know well, and at least one new name to us as well. Here are the largest D2C raises in Q3 2019:

 

  1. Wish: $300 million Series H
  2. Capsule: $200 million Series C
  3. thredUP: $175 million Series F
  4. Grove Collaborative: $150 million Series D
  5. Broll & Branch: $100 million PE round

 

It’s debatable if Wish should be included, given that they are more of a marketplace or new-age eCommerce play than a true D2C brand. But it’s important enough of a round for us to feel justified including them.

 

Capsule is the company who I didn’t know much about — and that’s surprising, given how closely we are tracing the D2C telemedicine space. It’s probably because this is a NYC-based company, and since we are on the West Coast, we don’t actually see it in action. Their offering seems like a really smart one aimed at disrupting the overall pharmacy space.

 

We’ve written about Grove Collaborative before on our List of best D2C Brands — cool company, and it’s good to see them bringing in additional resources to continue their rapid growth. 

Most interesting D2C Funding rounds of Q3

 

These smaller companies caught our eye as the most interesting fund raises for Q3:

 

  • Nurx: $32 million Series C: we love the online doctor + pharmacy model, and have reviewed Nurx before. Really exciting innovation and business model that lowers the cost of healthcare and female contraception.
  • Ruby Love: $15 million Series A: another exciting “FemTech” company attacking a problem that mainstream CPG hasn’t been solving. We’ve written about a few of their competitors before, and look forward to seeing this company grown.
  • Gennev: $4 million seed round: maybe we should just rename Q3 2019 the FemTech quarter! Another awesome startup trying to use technology to improve the lives of women.
  • FitzFrames: $2.5 million seed round: a compelling use of 3D printing, FitzFrames is bringing custom 3D glasses to kids! Fun market, and we look forward to seeing this company take off.

About the data

 

Fin vs Fin is dedicated to bringing consumers the best information on the newest direct-to-consumer startups. The data from this report was culled from a list of consumer and healthcare fund raises, originally sourced from Crunchbase

 

Know any startups that should have made the list? Leave a comment and we’ll look into them! 

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