Kleiner Perkins to Invest $40 Million in Toronto-Based Tulip.io -- Update
August 22 2017 - 11:37AM
Dow Jones News
By David George-Cosh
Tulip.io Inc., whose mobile software allows sales associates and
retailers to engage more effectively with customers, has raised $40
million in a new round of venture-capital financing led by Kleiner
Perkins Caufield & Byers.
The financing, which marks Kleiner Perkins' largest investment
in a Canadian technology startup, will help Tulip double its staff,
expand to retailers in Europe, South America and Asia as well as
develop its software for other industries such as the hospitality
sector.
Toronto-based Tulip provides a platform that gives sales
associates real-time access to consumer preferences and customer
data on a mobile or tablet device. The company's software is
already being used by major U.S. retailers such as Hudson's Bay
Co.'s Saks Fifth Avenue and Coach Inc., and is used across 25
countries and in 7 languages. It is also a member of Apple Inc.'s
Mobility Partner Program alongside International Business Machines
Corp., Cisco Systems Inc. and SAP SE.
While customers are increasingly going online to buy goods,
in-store purchases remain a strong driver of retail sales,
according to a recent survey published by Deloitte and commissioned
by Tulip. Roughly 70% of survey respondents said more than half of
their sales come from physical stores.
To help stem losses from online competitors, Tulip assists
brick-and-mortar retailers to train their sales staff to provide a
more personalized shopping experience with their customers. A major
U.S. retailer reported a 4% increase in year-over-year sales and a
2% customer conversion rate in stores using Tulip's technology,
according to the company.
"The main focus with this capital is us, with Kleiner, thinking
we can go international faster if we can fund some of that growth
ahead of plan, " said Ali Asaria, Tulip's Chief Executive.
In addition to the investment round, Mood Rowghani, general
partner at Kleiner Perkins, will also join Tulip's board. Mr.
Rowghani said he visited three stores in California that use
Tulip's technology before agreeing to invest in the company and
believes its platform can help bridge the divide between
traditional retailers and e-commerce.
"Traditional retailers have this treasure trove of intimate
knowledge of their customers," said Mr. Rowghani. "It's a huge
opportunity if they're armed with the right tools and be able to
marry it with digital technology. Tulip is at the core of that
experience."
Tulip was founded in 2013 after Mr. Asaria stepped down as CEO
of Well.ca, a Canadian-based e-commerce website that specializes in
beauty and wellness products. Tulip has previously raised about $11
million from a series of investors, including SoftTech VC,
Chicago-based Jump Capital and Fung Capital USA, and has about 130
staff in Toronto and Kitchener, Ontario.
Before founding e-commerce companies, Mr. Asaria cut his teeth
as a software developer at BlackBerry Inc. where he created one of
the company's first games for its smartphones. The executive
declined to comment on Tulip's current valuation.
"We have a long-term 20-year plan for this company," Mr. Asaria
said. "We want to build one of the largest enterprise companies and
we want to find investors that are interested in that long-term
alignment." He added that the size of the funding round should be
enough to sustain the company's growth for the next five years,
after which it will explore a possible IPO.
The investment also marks the latest sign of a maturing Canadian
technology sector with Kleiner Perkins being the latest major U.S.
venture-capital firm to invest in a Canadian startup. Last year, a
fund managed by Goldman Sachs Group Inc. led a round of financing
with Toronto-based Hubba Inc., while artificial intelligence
developer Element AI secured a $102 million Series A round of
funding led by Data Collective in June.
U.S. investment in Canadian technology startups reached 1.06
billion Canadian dollars (US$842 million) last year, more than
triple what was spent in 2010, according to Thomson Reuters.
Write to David George-Cosh at david.george-cosh@wsj.com
(END) Dow Jones Newswires
August 22, 2017 11:22 ET (15:22 GMT)
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