Seth Goldman, UrbanStems CEO, joins Yahoo Finance’s Kristin Myers and Alexis Christoforous to discuss the growth outlook for the flower company and its $20 million Series C funding.
ALEXIS CHRISTOFOROUS: In case you didn't know, this Sunday is Mother's Day. Don't forget. And that means big business for the online flower startup UrbanStems. The company just raised $20 million in its latest funding round after more than doubling sales last year. Joining us now is the CEO of UrbanStems, Seth Goldman. Seth, good to have you with us. Before we get to that funding round and what's next for the company, I want to talk about this week. How is it shaping up as you move closer to Mother's Day?
SETH GOLDMAN: Yeah, Mother's Day is always a big week in that flower industry. And UrbanStems is no exception. We are going to end up having the biggest revenue week in our company's history, which is great. We're looking forward to delighting a lot of moms. Some have already gotten their flowers. So I hope you guys have loved what you've gotten. And some are going to be getting them today, tomorrow, and Saturday. We don't have much being delivered on Sunday outside of New York and DC.
KRISTIN MYERS: Now, Seth, I want to ask you about the impact of the pandemic on the business. I feel like all of my friends are now obsessively becoming plant moms and dads and getting a lot of fresh flowers every single week into their home. How did that impact growth for you guys over the past year?
SETH GOLDMAN: Yeah, well, we believe that because people are home more, that home as a sanctuary has become very important to people, as well as the inability at times to see people in person. And that that feeling of missing someone, you were supposed to go visit them in LA or New York, or wherever your loved one was, and you couldn't, so you wanted to connect with them, not just with a phone call or a Zoom call, which were great options, but still with something more meaningful. So flowers became a really important gift that people sent during the pandemic. And we saw that in talking to peers as well that those that were sending flowers online saw an increase in business.
ALEXIS CHRISTOFOROUS: Now I know UrbanStems was founded in 2014. Since then, you've raised a pretty impressive $48 million. About half of that, a little less than half of that, just happened in your most recent funding round. Can you tell us what you were going to use that capital for? And are you moving closer and closer to the public markets?
SETH GOLDMAN: Sure, so we're investing in three areas. I think it won't be super surprising. But in people, we want to build out our team, in technology, which I have some fun things that I could share, and in our infrastructure, just building more and more, especially, as you may not know, there are a couple of cities where we do have what some folks refer to as dark stores where you can't walk in, but we do deliver the same day. We want to build that out as well. So we're excited to use this money. No plans yet to tap the public markets. We're excited to really use this to create an even better customer experience and go from there.
KRISTIN MYERS: Seth, would love to hear some more of those details on some of those tech that you're planning on investing on going forward.
SETH GOLDMAN: Yeah, so when you come to our site, we're trying to accomplish two things for you as a consumer. We're trying to help you have sort of a maximum special experience with minimum effort. So in a lot of the digital side, sending flowers can feel old-fashioned or not fun or not cool or not easy. We want to make it easy, fun, and rewarding. So building out digital tools where when you come to the website, you're ushered through a journey that feels very you, very personalized, helping you get the exact right gift with the exact right add-ons, be it a candle or a chocolate or a personalized note and gift card that really sends the exact message that you are trying to convey to that loved one, or if it's a business, send to the client or to your own employee.
Behind the scenes, there's a lot of tech work that goes into that to making orders more personalized and making that flow as easy as possible. And we're going to be working on a lot of that to really continue to revolutionize how people send gifts online.
ALEXIS CHRISTOFOROUS: Taking a-- perusing the website, you've really got some beautiful options here. But prices are a little, I guess, more expensive than you might pay at a competitor. Who are you targeting here? Who is your audience? And how are you convincing people to pay that premium?
SETH GOLDMAN: Yeah, over the past four years, we've really thought about our consumer and what they want. And that's the other side of maximum special with minimum effort. That maximum special piece comes in now. So customers were telling us both with their dollars and when we spoke to them that having an order that was more in terms of the stems that we put in, finding those unique colors and specific varieties of roses or other flowers that they couldn't get elsewhere was important to them.
So we tend to cater a little bit more to people who have a point of view on the color palette they want, on specific stems that they love, like a ranunculus or an anemone. They are often seeing only in wedding bouquets or similar flowers that you don't find every day. And customers, those stems are substantially more expensive, but customers are signaling to us that that's what they want. We do have bouquets as low as $35 to $40. And we have a number at or above $100 as well.
ALEXIS CHRISTOFOROUS: All right. Well, I know you're still going to have a very busy few days there at UrbanStems. CEO Seth Goldman, thanks for being with us.