Short news cycles tend to feed off dramatics. So, even though e-commerce sales have cooled from the peak of the pandemic, Cart.com has maintained its bullish outlook on digital amid the hysterics touted in some headlines.
The Austin-based technology company clearly has a stake in the conversation. Cart.com, in the simplest terms, offers brands the ability to sell across channels, from Amazon to Instagram. It also provides related services on, among other things, fulfillment, marketing, analytics and channel management. Think of it as the conductor in an orchestra of multiple vendors, advisors and applications needed to scale a digital business.
“It’s kind of interesting because in 2020, 2021 Covid kind of accelerated the digitalization of the economy by 10 to 15X,” Cart.com CEO and co-founder Omair Tariq said. “There are some estimates that say we’ve brought eight to 10 years of growth into these two years. And then in 2022, when some of these companies are growing 5 percent versus 75 percent, people are freaking out and I’m like, wait, but the CAGR. Math. So we’re actually very, very bullish on the digitalization of the e-commerce enablement of the economy and we believe, if anything, the trend is going to get stronger over the next few years.”
One need not look farther than the next generation of shoppers to see that, Tariq went on to say.
“If you look at anybody from 5 to 25 years old, and if you ever see them without technology or their phones or their iPads, then I’ll give you a dollar,” he said.
The implication of the statement is the CEO’s money is safe given the company’s bet that digitalization will only accelerate in the future. The only difference is the rate of that growth is clearly not what it was during the pandemic.
Cart.com takes the premise of growth a step further, with the acknowledgement that future selling is multi-channel and there’s no going back. That’s also where the company sees its competitive advantage—not in competing with the likes of Amazon or Shopify, but in creating a technology solution around omnichannel selling.
The company’s new product released Tuesday, dubbed Cart Channels, aims to make it even easier for brands to plug their products across more than 2,000 selling, social media and advertising options, while also managing pricing. Cart Channels touts a single tech interface as opposed to multiple, further streamlining the back-end process enabling digital commerce.
Cart.com’s not built for the seller that thinks having a great online store is good enough because, as Tariq put it, consumers don’t think that way anymore. Shoppers are not favoring any one retailer or marketplace over another, making no one selling channel more powerful than another so that, even if brands are seeing a rise in social shopping, for example, it doesn’t mean other platforms can be tossed aside.
“You have to make sure your product is visible in literally every nook and cranny that these new generations are shopping in,” Tariq said.
Investors clearly see a similar future.
Cart.com in February pulled in $240 million in debt and equity funding, bringing its total raise to date to about $380 million. At the time of the raise, the young company’s headcount had swelled to more than 850 employees with more than 6,000 brands on its platform, including Guess, Ubuntu Life, The Man Refined, Howler Brothers, William Murray and Rowing Blazers.
“Citi Ventures is excited about the future of commerce and we were particularly impressed by how quickly and seamlessly Cart built a comprehensive platform to power e-commerce,” Citi Ventures managing director Luis Valdich said at the time of the February funding. “Omair’s industry expertise and M&A playbook have enabled the company to rapidly identify targets, execute acquisitions and fully integrate new partners into Cart’s unified platform.”
Citi, Visa and Legacy Knight Capital Partners were all part of the latest equity round, while J.P. Morgan and TriplePoint Capital provided the debt financing.
In the fall of 2020, when Tariq and co-founder Jim Jacobsen decided to launch Cart.com, the market was in a different place. Consumers, under shelter-in-place orders, turned to online shopping and delivery in droves. What was happening made digital’s case clear, if it hadn’t already been within companies.
Jacobsen is the former CEO of cooler and insulated drinkware company RTIC Outdoors, while Tariq was an early employee of Blinds.com before it was acquired by The Home Depot in 2014 on undisclosed terms.
Blinds.com operated off a similar philosophy as Cart.com: commerce everywhere and, because of that, Tariq said Blinds.com owned 60 percent of the online market. And, while serving as operating and finance chief of Blinds.com after it joined the Home Depot fold, Tariq saw the value in having a connected infrastructure on the backend to make it easier to sell product in many places.
Two trends abounded in the marketplace during the pandemic that fueled the decision to launch Cart.com, the CEO said. First was the digitization of businesses that required multiple applications and service providers. What resulted was a technology and operations stack Tariq likened to Frankenstein. The other trend was the overlapping or adding of selling channels for brands.
“Our competitive advantage and value proposition is that we are the only company in the world that allows you to sell your product on all the marketplaces, on all social channels, on your direct-to-consumer website, on wholesale distribution,” Tariq said. “And we do that both technologically and operationally.”
Today, at about two years old, Cart.com is growing rapidly.
Tariq said the business has doubled every six months since its start, and in some cases tripled. It counts 10 fulfillment facilities and just signed a lease on another 1 million square feet. It’s likely to add another 1 to 2 million square feet to its real estate portfolio next year, according to Tariq.
Acquisitions have also helped scale. The company counts eight to its name so far, the most recent of which was DataFeedWatch in March. The acquired business helps brands distribute, promote and manage their products’ digital listings in places such as Amazon and Walmart.
For the most part, Tariq said the company is currently focused on building out the existing business due to its growth rate, but tempered the statement saying it will also be opportunistic when it comes to raising capital or acquiring new targets if it’s right for the business.
“Cart.com is sitting really, really pretty from a balance sheet perspective,” he said on the subject of additional capital raises.
Buying up businesses in the fintech space could make sense to provide capital advances to brands, something Cart.com does not currently do, or anything else that would be additive to the company’s existing offerings, he added.
Ultimately, the vision shaping the company’s strategy is easy to remember. “We want to create radical simplicity,” Tariq said.