Lulus, an e-Commerce fashion retailer, has closed a $120 million investment from IVP, a venture capital and growth equity firm, and Canada Pension Plan Investment Board (CPPIB), a global investment management firm.
With the funding, Lulus plans to support growth initiatives like building out its East Coast fulfillment center, entering new categories such as shoes, and increasing its headcount.
Mother-daughter team Debra Cannon and Colleen Winter founded Lulus in 1996 to cater to shoppers in their twenties, but more than two decades later the company has thrived on its ability to attract Millennials, particularly through social media channels.
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“It would be very hard to go out to Instagram, YouTube, Pinterest — look for fashion in our demographic — and not find something from Lulus,” said Winter, CEO of Lulus, in an interview with CNBC.
“Instagram captured an impressive 96% of total social media interactions for retailers over the last year alone,” said Alizah Farooqi, Content and Marketing Associate at Gartner L2 in a blog post. “Through the platform, Lulus gains another advantage. More than 85% of the brand’s online clothing is Lulus-branded. When the Lulus Instagram handle shares these items using the hashtag #LoveLulus, 1.3 million followers become increasingly loyal to the brand.”
The California-based fashion brand began as a brick-and-mortar boutique in California before fully shifting online in 2010. The company has no short-term plans for brick-and-mortar stores, but Winter isn’t ruling that out, revealing that “core outlets” are a possibility in the future.
Lulus also prides itself on being data-driven to help it more efficiently order clothes, sidestepping the burdensome costs of unused merchandise.
IVP has a history of investing in innovative consumer companies like Glossier, HomeAway, The Honest Company, Snap and Twitter, making Lulus a fit for the firm. As part of the company’s investment, Eric Liaw, General Partner at IVP, will join the Lulus Board of Directors.
“Lulus’ business is exposed to a number of long-term growth drivers that align with CPPIB’s Thematic Investing strategy,” said Poul Winslow, Managing Director, Head of Thematic Investing and External Portfolio Management, CPPIB. “Lulus’ proven track record as a successful retailer targeted to Millennial women and as an early participant in the e-Commerce space demonstrates their ability to thrive in the rapidly changing retail segment where customers are increasingly shopping online.”
Lulus Raises $120 Million On The Back Of Strong Millennial Following
