Loop Commerce Grabs $16M To Simplify eCommerce Gift Giving

Loop Commerce, an eCommerce startup that simplifies gift-giving and short-circuits the need for returns and exchanges, has closed a $16 million investment round, the company announced on Tuesday (April 28).

The Series B round was led by Oren Zeev together with Dan Tierney and Stephen Schuler’s Wicklow Capital, along with a large collection of strategic eCommerce investors including PayPal, Andrew Fine, Silas Chou’s Novel TMT, Amazon executive VP Don Katz, former eBay CTO Mark Carges, Facebook strategy VP Dan Rose, former Brooks Brothers eCommerce executive Ken Seiff, former Toys”R”Us and Best Buy EVP Michael Scharff, former Michael Kors eCommerce SVP Ron Offir, KKR’s Richard Sarnoff, Chegg CTO Chuck Geiger, Magento founder Roy Rubin, SG managing partner Dovi Frances, and Blackhawk Networks board member Mohan Gyani.

The new money, the first new funding since a $12 million round in late 2013, will go to add to the current 30-member team, especially in engineering, data, sales and marketing, product and design, and keep investing in research and development for Loop’s e-gifting platform.

Loop’s concept is deceptively simple: When a customer is shopping for a gift at a Loop partner’s eCommerce site and doesn’t know some critical detail — say, size or shipping address — Loop’s system lets the customer pay for the gift, then sends an email to the gift recipient, who then comes back to the eCommerce site, completes the purchase (or exchanges the selected gift for something else) and sets up delivery.

But making it happen? Not so simple. “Challenging some of the core fundamentals of commerce turned out to be a significant task,” Loop Commerce CEO and co-founder Roy Erez said in a prepared statement. “We couldn’t have dreamed so big without the A-list people who have invested in us from the beginning and have supported us along the way. Their invaluable guidance is helping make our vision a reality — unleashing e-gifting’s potential to change the way we buy, give and receive gifts.”

Along with avoiding abandoned shopping carts and cutting out the need for gift-item returns, Loop’s system — which is currently being used by Macy’s, Lancome, Urban Decay, Diane von Furstenberg, Johnny Was, Relax the Back and Thomas Dean — brings gift recipients (half of whom are new customers) into retailers’ online stores. Retailers also get analytical insights and higher return on investment.

Launched last fall as software-as-a-service, Loop currently charges a percentage of each transaction. But it soon plans to add a premium analytics option offering retailers more data about shoppers and their purchases, TechCrunch reported.