Online gifting service Loop Commerce was in limelight earlier with a $7 Mn Series A funding round. It was done by high profile investors such as Chuch Geiger (Formerly CTO at PayPal, Ask.com), Oren Zeev and Mark Carges. On December 10th 2013, the company announced that they had added an investment from PayPal to the Series A round.
Loop Commerce was co-founded by Roy Erez (CEO) and Alex Sirota (CTO) in 2012. The company has received a funding of $8.2Mn through investors such as Don Katz, Roy Rubin, Andrew Fine, Michael Scharff, Mohan Gyani, Barry McCarthy, Oliver Jung, Frederic Court, Harris Barton, Gary Ginsberg, Ori Sasson, Novel TMT Ventures and SG VC. Their latest funding from PayPal was undisclosed but the amount adds up to $5 Mn. This brings the total funding amount to $13.2 Mn.
“We are impressed with the Loop Commerce team, approach and technology. Improving the online gift-giving and -receiving experience is of great importance to both retailers and consumers,” said Don Kingsborough, VP, Global Strategic Development for PayPal. “We believe Loop Commerce represents the next stage in the evolution of the multi-billion dollar gift-card industry, empowering retailers and creating new opportunities through next-generation gifting experiences.”
How does it work?
- The solution works by integrating with a retailer’s website. It essentially makes the gift-giving process a collaborative one.
- Loop Commerce basically creates a separate checkout process for consumers purchasing gifts.
- When a shopper wants to gift an item to a friend, they go through Loop’s checkout process, sending a notification to the recipient asking for shipping, sizing, and color preferences.
- The recipient then receives a link in their inbox where they can select the specifics of whichever item the gift-giver chose — say the style preference or color of a shirt — and then order the item.
- If your friend does not like the product you picked out for him, he can exchange the item before it ever ships, thus saving the retailer time and money.
“Others just got it wrong,” said Roy Erez, CEO of Loop Commerce. “Gifting is not a social app or a mobile app or whatever it is. And that’s really what the majority of companies were trying to do.” The company aims to put gifts at the forefront of the shopping experience. Its solution appeals to retailers by promising to increase their potential customers and reduce the amount of returns they receive.
Loop Commerce has been in private beta since November, and the team has not yet set a date to open up the service to retailers according to CEO Roy Erez. However, they have added merchants to their test roster over the previous month.
Don Kingsborough, previously founder and CEO of gift card and prepaid payments network Blackhawk Network, is set to serve as PayPal’s observer on Loop Commerce’s board. PayPal’s recent investments include Restaurant ordering platform OLO, Japanese personal finance app Moneytree and service bill payment startup BillFloat.