Zola Inc. the startup, led by former Gilt Groupe executive Shan-Lyn Ma, said Thursday it raised $100 million from investors including Comcast Corp. and Goldman Sachs Group Inc. The deal values Zola at about $600 million, according to a person familiar with the deal.
The round, led by Comcast’s venture capital unit, brings Zola’s total funding to about $140 million. Lightspeed and Thrive Capital also participated.
“Unlike most e-commerce businesses, I would say it features a handful of really attractive attributes,” said Ian Friedman, who led Goldman Sachs’ investment in the deal.
Zola can predict how much of a certain product it needs to order well in advance, because people fill out registries weeks, if not months, ahead of a wedding. The company avoids most returns, or what Friedman calls “the silent killer of retail,” by letting couples switch out things they don’t want. And Zola doesn’t carry inventory risk by stocking up items in its own warehouses.
That all makes the company an “e-commerce business that exhibits the predictability of a software business,” Friedman said.
Ma started Zola in 2013 after leaving Gilt, the flash-sale e-commerce company that was eventually sold well below its peak private-market valuation.
Zola’s new $100 million is more than Ma initially set out to raise, but it doesn’t change the company’s plan, she said. “One of the things we want to mitigate against is often when startups raise a large round they get tempted to spend money on things they would not have spent on previously,” she said.
The company has around 110 employees now, and plans to grow to round 150 by the end of 2018. Marketing will ramp up though, and Zola plans to spend more on TV advertising to get its name in front of millions of Americans, Ma said.