Funding dollars to subscription e-commerce startups hit a 11-quarter low in the last quarter at $35M, down 90% compared to the same quarter a year prior. Over the longer term, funding is down even more dramatically from the peak of $317M in Q3’15.
On the other hand, deals have held relatively steady, passing the 10-deal mark in five out of the last six quarters.
Investment dollars in the peak quarter for funding, Q3’15, were driven by a $100M Series C round raised by beauty products startup Ipsy, an $85M Series F round raised by Berlin-based HelloFresh, and a $76M Series C round raised by Harry’s Razor Company. The average deal size that quarter was nearly $19M across 17 deals, compared to just $2.3M across 15 deals in Q1’16.
Deal activity saw an uptick in Q1’16, after dropping to 13 in Q4’15 from 17 in the previous quarter.
Deal share by stage
Over 70% of the deals over the last 5 years went to early-stage (seed/angel and Series A) startups. However, in 2015 early-stage subscription e-commerce startups saw less deals, 30 deals, compared to over 45 in the previous year.
Late-stage startups using a subscription model had a minimal deal share over the last 5 years, 4%.
Most active VC investors
500 startups was the most active VC investor into subscription e-commerce startups, having backed over 10 unique subscription e-commerce startups, including FabFitFun, Sproutkin, and Ipsy. Accel Partners ranked second. It recently invested in companies including TeaBox and Birchbox, but its investment activity in this sector has slowed since 2011.
| Rank | Investor |
|---|---|
| 1 | 500 Startups |
| 2 | Accel Partners |
| 3 | Lerer Hippeau Ventures |
| 4 | Pritzker Group Venture Capital |
| 4 | BoxGroup |
| 4 | Great Oaks Venture Capital |
| 7 | NextView Ventures |
| 7 | Lightbank |
| 7 | Andreessen Horowitz |
| 7 | First Round Capital |
Most well-funded companies
Fashion retailer JustFab, backed by investors including Kimora Lee Simmons, Matrix Partners, Polaris and Technology Crossover Ventures, is the most well-funded startup on the list. New York-based Harry’s Razor Company ranked second.
The rankings below are based on equity financing.
| Rank | Company |
|---|---|
| 1 | JustFab |
| 2 | Harry’s Razor Company |
| 3 | HelloFresh |
| 4 | Blue Apron |
| 5 | Dollar Shave Club |
| 6 | Ipsy |
| 7 | BeachMint |
| 8 | GlossyBox |
| 9 | Birchbox |
| 10 | Plated |
| 11 | Julep Beauty |
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