People are not only shopping digitally more than ever. They’re also shopping using their mobile phones more than ever.
And for mobile-first companies like Snapcommerce, this is good news.
Snapcommerce, formerly known as SnapTravel, has raised $85 million in what the company describes as a “Pre-IPO” growth round to help further its mission of “changing the way people shop on their phones.”
The Toronto, Ontario-based startup has built out an AI-driven, vertical-agnostic platform that uses messaging to personalize the mobile shopping experience and “deliver the best promotional prices.” While it was initially focused on the travel industry, it is now branching out into other consumer verticals – hence its name change.
Inovia Capital and Lion Capital co-led the new growth round, which included participation from Acrew DCF, Thayer Ventures, Full In Partners, and existing backers Telstra Ventures and Bee Partners. The financing brings Snapcommerce’s total raised since its 2016 inception to over $100 million. Its last raise — a $7.2 million round from Telstra and NBA star Steph Curry — took place in 2019.
The startup was founded by tech entrepreneurs Hussein Fazal, whose previous company AdParlor grew to $100+ million in revenue, then sold to AdKnowledge back in 2011; and Henry Shi, who previously built unmentioned and worked at Google, where he helped launch YouTube Music Insights, according to previous TechCrunch reporting.
Snapcommerce launched its first travel-focused product in 2017. It works by using chatbots to interact with customers via messaging apps such as SMS, Facebook, and Whatsapp. But the company also has human agents ready to help if people need more assistance, in the past essentially serving as on-demand travel agents.
Its service is not just for hotels and flights, but also to help people book restaurants and activities.
“Our focus has been on building that personal relationship,” Fazal said. “Many people end up coming back to us when they travel again.” Over 40% of its sales in 2020 came from repeat customers.