Disco Raises $20M Series A led by Felicis Ventures to Unify the Next Generation of Online Merchants
Today, Disco (formerly known as co-op commerce), has announced a $20M Series A led by Felicis Ventures with participation from Shopify, Sugar Capital, Bessemer Venture Partners, Indicator Ventures, RiverPark Ventures, and several others, including Ankur Nagpal's Vibe Capital, Packy McCormick's Not Boring Fund, and a slew of DTC founders and operators. Disco was created with the sole focus of empowering the world's ecosystem of independent brands to limit their reliance on big tech platforms for acquiring customers by working together. Disco serves many of the largest merchants in DTC across a variety of categories, including the likes of Parade, Lovevery, Made In, Girlfriend Collective, Faherty, Rhone, Caraway, Milk Bar and many more.
Disco has raised $26M to date and will use the fresh round of capital to continue to create a flourishing ecosystem of brands and innovative products as well as grow the team considerably. The company, now 27 people strong, anticipates scaling to 75 by year end, including engineers, product specialists, marketing experts, customer success, and sales.
"Unlike centralized marketplaces where merchants have limited visibility into their customers, we are building a future where independent brands can join forces and benefit from their collective power," said Conner Sherline, Founder and CEO of Disco.
"By giving them the tools and data to work together across partnerships, marketing, and merchandising, Disco is unlocking a massive opportunity for merchants to attract and retain new customers at scale."
As more and more businesses move online, costs of acquiring customers on digital channels have skyrocketed, resulting in brands desperately searching for new ways to drive awareness and gain new customers.
Disco believes that uniting the millions of independent brands in the eCommerce ecosystem and giving them tools to work together across partnerships, data, and merchandising is the silver bullet that can solve for the massive hurdles brought into play across targeting and acquisition.
Partnerships to expand a brand's reach are great in theory, but hard in practice and challenging to manage without contextual placement, streamlined collaboration, and tracking. Disco is on a mission to craft a better way for brands to work and scale together.
The company's founder, Conner Sherline, previously held senior roles at Facebook, Instagram, and Affirm. Over the 5+ years he was at Facebook, he saw costs rise on the platform over 30x. At Affirm, he learned the power of the eCommerce websites and the captive attention that exists further on in the check flow. These career defining experiences landed him on the first product at Disco, the post purchase network that recommends complementary brands to consumers across over 600+ DTC brands after they've made a purchase.
Every time a brand shows their customer another brand, they earn distribution for their brand, incentivizing them to cross-promote each other more frequently, establishing a virtuous circle of acquisition that drives results.
"Disco is an absolute no-brainer for Shopify brands. Implementation takes 10 minutes -- and from there it's all passive incremental revenue!" - Dan McCormick, Head of Finance at Parade.
Disco's post purchase network learns which brands pair best together and what customers have the highest propensity to buy from a specific retailer. In its first year of business, Disco saw over $1B of transactions across its brand network and over 40M shoppers.
In the next chapter of Disco's journey, the company will leverage network insights and machine learning to improve and expand on its product suite to offer brands more strategic and effective ways to attract and keep the right customers.
"The most exciting thing about Disco is how it empowers brands to work together to improve acquisition and personalization at scale. With iOS 15 and a cookieless future, digital marketing is now largely operating in the dark. SMBs are most affected because they have limited access to data and resources of larger businesses. Disco's product suite is designed for this cohort to combat these existential threats. And that is incredibly exciting and inspiring." - Niki Pezeshki, General Partner Felicis.
Within its short 18 month history, Disco has increased its product offering significantly and is now a full product suite and platform that supports upsells, cross-promotion, audiences, intelligent insights, seamless brand partnership and much more to come. Disco, a Shopify Plus Certified App, also integrates with any online storefront, including those utilizing Shopify, Magento, WooCommerce, Big Commerce, SalesForce Commerce Cloud, WordPress and even custom builds with more than 600+ independent brands.
"Disco has been an effective extension of our paid marketing spend. By enabling targeted, post-purchase merchandising with other relevant brands, Lovevery has been able to realize a healthy ROAS." - Natalie Reed, Sr. eCommerce Manager at Lovevery.
About Disco Disco is a network of brands that work together to learn more about their customers, increase merchandising distribution and lower customer acquisition costs. Through their advanced AI-driven partnership software, Disco makes recommendations to millions of consumers across hundreds of brands each month. Members of the Disco Growth Network include leading direct-to-consumer brands like Rhone, Lovevery, Parade, Made In, and Faherty. To learn more about Disco, visit: disconetwork.com.
About Felicis Founded in 2006, Felicis Ventures is a venture capital firm investing in companies reinventing core markets, as well as those creating frontier technologies. Felicis focuses on early stage investments and currently manages over $2.1B in capital across 8 funds. The firm is an early backer of more than 41 companies valued at $1B+. More than 91 of its portfolio companies have been acquired or gone public, including Adyen (IPO), Credit Karma (acq by Intuit), Cruise (acq by General Motors), Fitbit (IPO), Guardant Health (IPO), Meraki (acq by Cisco), Ring (acq by Amazon), and Shopify (IPO). The firm is based in Menlo Park, CA. Learn more at www.felicis.com.
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