Ideeli gets $41 million in new funding to expand
04.28.2011
Reuters
By Phil Wahba

Flash sale website ideeli.com landed $41 million in venture capital funding that it will use to help it offer shoppers more brands and improve its customer service technology.

Flash sales sites typically offer designer goods, including overstock and samples, at heavily discounted prices in private sales that typically last just a day or two.

Ideeli, which competes with Gilt Groupe and GSI Commerce Inc's (GSIC.O) RueLaLa, said the new investment came from Next World Capital, Cue Ball Capital and current shareholders, StarVest Partners, Constellation Growth Capital and Kodiak Venture Partners.

The site has 4 million members, up from 3.1 million members in October. Its CEO, Paul Hurley, told Reuters on Thursday that ideeli was on pace to have annual sales of $250 million for the fiscal year that will end in January, which would be about 60 percent more than last year.

The new funding will be largely spent to invest in technology that will improve customer service and tailor promotions to a customer's individual tastes and habits, and to give ideeli that capacity it needs to support its growth, Hurley said.

"We're installing systems to allow us to run a $1 billion business," Hurley said.

Hurley told Reuters in October that taking the company public in late 2011 was a possibility. On Thursday, Hurley was vaguer, saying no decisions have been made, but he noted that the company was almost big enough for an IPO.

Ideeli serves a more middle-of-the-road clientele than its larger rival, Gilt, which focuses on luxury. The brands ideeli sells include Calvin Klein, Tommy Hilfiger and Nicole Miller.