Singapore-based Pixibo provides personalised size and fit recommendations in real time for online retailers and their customers. The fashion-tech startup worked with Kindrik Partners on their recent series A raise.
We spoke to founder and CEO Rohit Kumar on Pixibo, the capital raising journey, and working with Kindrik Partners.
Rohit is an ex-Googler with experience across Europe and India, before heading to Singapore to head up operations for e-commerce advertising company Sociomantic. Between 2013 and early 2016 he launched and managed all of Sociomantic’s APAC operations and was part of the team that sold the business to dunnhumby, a Tesco company.
It was at Sociomantic that Rohit identified an issue plaguing fashion e-commerce sites. People were browsing clothes online, but very few of those visits converted into sales. “The average conversion rate is 1.5%”, says Rohit.
Pixibo’s technology was formally launched in 2018, after a few years in development. The platform makes real-time size recommendations, personalised for every shopper and for every brand and SKU. For a retailer this boosts conversion rates, reduces return rate and improves customer satisfaction. Its size recommendation engine is entirely white labelled and can be natively integrated into online stores.
“In online shopping, there’s a lot of pain points, from finding something you like, to working out which size is correct for you,” says Rohit.
“Decision fatigue can come in, reducing sales and resulting in increased return rates. The Pixibo platform works to reduce the friction felt by the consumer and the retailer.”
working with kindrik partners
“I was educating myself about series A rounds when I came across Kindrik Partners’s content online,” Rohit says.
“It was my first time doing an institutional round so I was spending more time online trying to get my head around the legal terminology and the types of things that show up. Drag alongs, tag alongs, liquidation preference clauses. There’s a lot to understand.”
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“It looked like Kindrik Partners were the best lawyers for startups,” says Rohit.
“It was clear from the content that was available online that it was their area of expertise. When I eventually needed to bring in a lawyer to help with my round, I reached out.”
on the series A round
Pixibo already had several angel investors prior to their series A round in 2018, but the startup did not have any VCs on board, so the experience was new.
“We had VPs from Google who invested at an early stage, as well as strong private angel investors. But this was the first institutional round, and it felt very different.”
A big learning was how much longer the process took. “I thought you’d just go out to market, pitch, and then get them to sign. I eventually came to understand the level of process that institutional investors require, and how this stretches out the timeline.”
“There’s a great level of detail required. From investor interest to the term sheet to drafting the shareholder’s agreement, share subscription agreement and the whole nine yards, to signing, to getting money in the bank… it can take a long time!”
Fortunately, runway was less of a concern for Pixibo. “We weren’t in a rush. We had revenue, so there was no immediate need to get funding in”, says Rohit. “We already had a recurring revenue from our licence fees we were charging. That started conversations for us with investors, too.”
working with kindrik partners
Rohit found working with Kindrik Partners and partner Lee Bagshaw provided a lot of value during the capital raising process.
“Working with Lee was great. He was very responsive to my requests and concerns and was always happy to get on a call if need be to walk through things with me.”
Kindrik Partners’s experience in capital raising in Southeast Asia was also an asset to Pixibo.
“As a first time founder, sometimes you’re like wait, hang on, why is that in there? Lee was invaluable in these situations. He understood what terms were negotiable and what terms weren’t, and was instrumental during all of the back and forth with investors.”
tips for founders embarking on their A round
Rohit has a few tips for those entrepreneurs who are considering going out to do their series A round.
- start out 6 -8 months before you need the capital: especially if it’s your first institutional round (it gets easier with a follow-on round, because you’ll have existing investors to help you get your foot in the door).
- consider a rolling close: since you’re looking for investors who are the right fit in a long-term partnership, having a rolling close allowed Pixibo to get the money in the bank from the investors who were committed, while continuing to find the perfect fit to close out our round.
- beware the temptation to think that any money will do: in the beginning, the temptation is to look for anyone with a cheque book, but then you get smarter. Find the VC’s thesis and their sweet spot, and get smarter at looking at their portfolio to see if you fit in. Who will be interested in your story?
- don’t raise too soon: Traction is important. Wait until you’re in a strong position to raise, if you can. In our case, as we’re B2B, we had clear proof points that our product works, solves a real problem for online retailers and that they are willing to pay us for it. Investors will want to see that you have put in the hard work and that capital will accelerate growth.
- have a plan for the money. You have to articulate why you need capital now, and how it will help your business.
what’s to come for pixibo
The future is bright for Pixibo, and Rohit is looking ahead to expand into new markets. “The most exciting thing about us is that we’re location agnostic. The problems retailers have in Singapore are the same ones that they have in Sydney. The opportunity is massive.”
[Note: The firm’s name was changed to Kindrik Partners in July 2020 and references to the firm’s previous name have been updated.]