BloomThat

Market position

BloomThat was one of several venture-backed floral startups targeting younger consumers with smartphone ordering, artisan-style products and fast delivery, competing against established e-commerce florists 1-800-Flowers, FTD and ProFlowers. Its nationwide next-day launch moved it more directly into the incumbents' territory. The company ultimately exited at a valuation below the capital invested, according to the Stanford GSB case description.

BloomThat differentiated on speed and simplicity relative to incumbent e-commerce florists such as 1-800-Flowers, FTD and ProFlowers: a short, curated menu of bouquets rather than a large catalog, an app-first ordering flow compared to sending a text message, free delivery within 90 minutes in served metros, and low entry price points enabled by selling standardized seasonal packages. Presentation details such as recycled burlap wrapping and local, in-season sourcing were part of the product positioning.

Technology

Consumer-facing iPhone application and responsive website for ordering, paired with logistics for local courier fulfillment and a hub-and-spoke distribution model integrating UPS, FedEx and local delivery companies for nationwide next-day shipping.

Go-to-market

Direct-to-consumer through an iPhone app and website, supported by press coverage, brand collaborations (for example with apparel label Show Me Your Mumu in 2016 and Lyft in 2017), promotional campaigns around gifting occasions such as Valentine's Day, and marketing tied to well-known angel investors including Ashton Kutcher and Joe Montana.

Consumers sending flowers and small gifts, including a younger, smartphone-oriented demographic; positioning encouraged casual, non-occasion gifting in addition to traditional occasions such as birthdays, anniversaries and Valentine's Day.

Geography

Headquartered in San Francisco. On-demand delivery covered San Francisco, the Bay Area, New York City and Los Angeles; next-day delivery was offered throughout the United States following the February 2016 nationwide launch. Job listings were posted in San Francisco and New York.

History

David Bladow and Matthew Schwab, former college roommates, left their jobs and moved to San Francisco to build a venture together; after examining the broader gifting industry they settled on floral delivery, gaining early traction over Valentine's Day 2013. The company was accepted into Y Combinator's Summer 2013 batch and presented at Demo Day in August 2013. It raised $2 million in seed funding in February 2014 from SV Angel, A-Grade Investments and others, and, per a Stanford GSB case study, roughly $3.6 million of seed capital over the following year plus $4 million of Series A financing in December 2014; separate reporting describes a $5.5 million Series A led by Forerunner Ventures announced in June 2015. Expansion to Los Angeles in early 2015 created operational problems, and by that summer the company was near collapse; restructuring and bridge financing from existing investors in late 2015 stabilized it, but the turnaround did not attract new outside investors. Nationwide next-day delivery launched in February 2016. FTD acquired BloomThat in January 2018 for a reportedly small amount of cash, and in September 2018 the service was paused, with final orders fulfilled through September 28, 2018.

Risks & controversies

A Stanford GSB case study documents significant operational and financial distress: problems arose after the early-2015 Los Angeles expansion, the company was close to collapse by summer 2015, required aggressive restructuring and bridge financing from existing investors in late 2015, and failed to attract new investors afterward. By May 2017 the founders were weighing shutting down versus a sale expected to yield a low valuation, below the capital invested, with uncertainty over how proceeds would be split among founders, venture capital and venture debt holders. The eventual FTD sale was reported as being for a small amount of cash, and the consumer service was paused within months of the acquisition.