There are no shortage of startups trying to use online tools to make gift-giving easier for the buyer and the recipient. Karma recently raised funding for their digital gifting platform, and tools like SocialGift are trying to make it easier for groups to manage funds and give gifts. Today Wantful announced that they’ve raised $5.5 million in Series A funding for their customized gift platform, which acts as a personalized gift card. The round of funding is led by Polaris Venture Partners, with participation from Greylock Partners and several angel investors.
Wantful founder and CEO John Poisson said the funding will allow his team to expand on the original vision, which he said is to “help people give amazing gifts.” “We expect to dramatically increase the number of products, but also give you new interesting ways to put those together, and new interesting ways to deliver those to people,” Poisson said. He said the traction since launching in October 2011 has been strong, though they don’t share the number of gifts that have been created on the site. “The average order sizes are exactly where they were at the holidays. We’re seeing the normal spikes that you would expect at something like Valentine’s Day, but birthdays and thank you gifts continue to be really strong for us,” he said.
Wanful targets anyone who wants to give a bit of flexibility to a recipient instead of giving one item of their choosing. It allows users to send a booklet filled with curated gift options, allowing the recipient to choose their favorite item, which is then shipped directly to them. Users fill out a profile about the person they’re buying for, and answer questions about the person’s tastes. Once the questions are answered, users choose their price point (from $25 to $500, which includes the product’s delivery) and can either let Wantful populate a selection of gifts, or browse through a curated collection and select their own choices.
Gifts appeal to a wide range of interests – from $100 worth of baby back ribs and sauce, to a $250 basket of premium Belgian chocolate and caramels, and everything of the non-edible variety (watches, backpacks, kitchen gadgets). Once all 16 potential gifts have been chosen, users have the option to customize the booklet’s front cover and add a message, and can then send to the recipient via Facebook, email or snail mail (for an extra $5 charge, plus shipping costs).
The San Francisco- and Brooklyn-based company previously raised $2.4 million in two rounds of seed funding from investors including Greylock, Path’s Dave Morin and Foursquare’s Dennis Crowley. The new funding will be used for hiring, product development, and adding more products to the catalogue, with about 700 new products being added this month. Since launch they’ve partnered with about 400 brands and currently have thousands of products in the catalogue.
Wantful has a wholesale retail relationship with its brand partners, so actually owns the gifts offered through the site, rather than operating under an affiliate model. Poisson says the margin structure for gifts is “quite interesting.” While users can create a gift anywhere in the world, the site only ships to U.S. addresses, but Poisson said they’re looking to expand internationally. In addition to today’s funding news, the company also announced that they’re adding Polaris Venture Partners principal Ryan Spoon to the board – Spoon also heads up Dogpatch Labs in Palo Alto.
Combining a digital gift platform with a way to reach niche artisans and products isn’t a new approach – Karma, Etsy, Elfster and Wantist are just a few examples of communities that highlight products and give the ability to send gifts. “We think they’re interesting mobile plays that focus on that impulsive, lightweight, gifting,” Poisson said about Karma and similar solution Wrapp. “It’s not really the business we want to be in, we want to help you give a wider range of gifts more thoughtfully and have a stronger business model underneath all that.” According to a Tower Group report, the e-gifting market will triple by 2014, so Wantful is likely one of many startups that will emerge to try to capitalize on this growing market.