On a mission to help everyone feel great about their home - disrupting a £600bn market along the way
Business overview
| Location | London, United Kingdom |
|---|---|
| Social media | |
| Website | www.iamfy.co |
| Sectors | Home & Personal Digital B2C |
| Company number | 08924569 |
| Incorporation date | 5 Mar 2014 |
Investment summary
Business highlights
- UK's most loved home & living marketplace - 4.7/5 on Trustpilot
- Sales of £24m in 2021*, over 825,000 happy customers
- More rugs than IKEA, furniture than Made and art than John Lewis
- Backed by Hoxton Ventures, Forward Partners and 500 Startups
Idea
Introduction
Shopping for your home should be fun, but existing online and offline retailers struggle to deliver.
Shops, limited by space, offer narrow selections, and traditional marketplaces end up with overwhelming, impersonal shopping experiences driven by search.
Consequently, despite the home and living market being worth £600bn, just 14% of that takes place online (based on 2019 figures).
That’s the opportunity.
Traditional eCommerce was created for desktop and for search but shopping for the home is different, for two reasons:
1. It’s browse-based - shoppers often don’t know what they want until they see it.
2. Home and living is hugely fragmented, making it hard for shoppers to find inspiration, and for brands to be discovered. This makes it perfect for a marketplace.
We’re building the best way to style your space - a visual, discovery-driven shopping experience that curates the world of home and living around you.
And we’re using data, machine learning, and inspirational content to curate this assortment at scale, For You.
To our knowledge, we’re the first and only home and living shopping experience that learns your style and gets smarter as you go. Join us, and help us become the world’s number one home and living marketplace.
Substantial accomplishments to date
Since launching we have:
• Shipped over 1.75m products, generating sales of £24m in 2021, with gross margins of 65%*
• Sold to over 825,000 shoppers in over 50 countries, providing an experience they love - with an average Trustpilot rating of 4.7/5
• Raised £16m from top tier investors including Hoxton Ventures (who have previously backed unicorns Deliveroo, Babylon Health and Darktrace), Forward Partners (Cazoo), and 500 Startups (Canva).
• Built a marketplace of over 250,000 products from over 3,500 brands, meaning we now offer more rugs than IKEA, more furniture than Made and more art than John Lewis
• Launched in the US in 2018, and grew revenues to over $10m* in 2021 in less than 3 years
• Built a proprietary mobile shopping experience that uses data and machine learning to give shoppers a real-time, personalised and curated shopping experience
*Based on unaudited management accounts.
Monetisation strategy
As a consumer marketplace, our revenues come directly from shoppers in the UK, US, Europe and Australia.
We work with a broad mix of suppliers who fall into one of two categories: those who produce 1st party, exclusive products on-demand, and those who dropship their products directly to our customers.
Commission levels vary, but our blended gross margin is 65%.
Crucially, we don't purchase or hold any inventory in either fulfilment model, and we're not involved in warehousing or logistics. We own the relationship with the shopper and unlike many other marketplaces, provide end to end, high-quality customer service.
Marketplace benefits:
The home and living category is huge, unbranded and fragmented.
Being a marketplace means we can build a massive assortment of products and product categories quickly, with zero working capital requirements.
This allows us to offer shoppers an ever-larger, unique assortment of products.
We utilise real-time data and machine learning to ensure that the shopping experience feels curated, relevant and never overwhelming
Use of proceeds
The next phase of our growth plan has 4 key pillars:
1. Invest in our proprietary tech & IP to deliver an increasingly personalised shopping experience on our app and website.
2. Rapidly scale the number of products and suppliers on our marketplace, with the goal being to add 1m products to the marketplace by the end of 2023, giving shoppers more choice, and more reasons to buy
3. Invest in both paid and organic acquisition, with the aim to drive top-line revenues over £100m in the next 4 years
4. Go global and launch Fy! in more countries:
- 30% of sales in 2021 were in the US where the opportunity is massive
- 9% came from EU, despite a website and app that is 100% English - it’s time to localise and we’ll be starting with the French and German markets
Key Information
Share classes
The company has three classes of shares, Ordinary, Seed A-1 Preferred Shares and Seed A-2 Preferred Shares.
The Seed Preferred Shares carry a non-participating preference. On an exit or liquidation, Seed Preferred Shareholders will receive the higher of (i) £16.96, the price per share of the 2021 round and (ii) the amount they would have received per share if Seed Preferred Shares were converted into ordinary shares.
The remaining proceeds would then be distributed amongst all ordinary shareholders.
The Series A-1 Preferred Shares also carry broad-based weighted average anti-dilution rights.
Investors in this round, including Seedrs, will be issued A-2 Preferred Shares, which have been structured to be EIS-eligible.
Outstanding debt
The company has three outstanding loans:
1. £301,000 of revenue-based financing from Uncapped, being paid £8,000 weekly.
2. £148,000 of revenue-based financing from ClearCo being paid at a 2.5% remittance rate from revenue.
3. £424,000 of revenue-based financing from ClearCo being paid at a 2.5% remittance rate from revenue.
None of the funds raised will be used to repay these loans.
Existing Convertible Loans
1. Convertible Loans converting on this round:
The company has convertible loan notes totalling £1.38m from various investors. These CLNs will convert immediately after this round at a share price of £7.95.
We have factored the converting shares into the pre-money valuation. These additional shares increase the pre-money valuation to £41,232,302 from £38,071,555.
2. Future Fund Convertible:
Future Fund convertible loan agreement totalling £4.77m from 14 December 2020. The key terms are as follows:
- Discount: 20%
- Interest rate: 8% per annum, non-compounding. On conversion events, the company can choose to repay the interest or convert it to equity (generally without the discount).
- Valuation Cap: £35,000,000
- Redemption Premium: An amount equal to 100% of the principal loan amount
- Qualifying Equity Financing. The convertible loan will automatically convert on an equity financing raising at least the total loan amount, at the lower of (i) the lowest share price of the round less the Discount and the Valuation Cap.
- Non Qualifying Funding Round: The convertible loan can convert on an equity financing round which does not meet the size criteria of a ‘Qualifying Equity Financing”, at the election of the majority of investors under the loan. The loan will convert at the lower of (i) the lowest share price of the round less the Discount and the Valuation Cap.
- Maturity Date: 14 December 2023.
The default position is on the maturity date is that the loan will convert to equity unless the investor majority elect to redeem.
If redeemed, the company will repay the principal together with the Redemption Premium.
If converted, the conversion price will be at the most recent funding round share price less the Discount, provided that funding round happened after 20 April 2020 and was at least a quarter of the size of the convertible loan investment. If no such funding round has occurred, conversion will be at the share price of the last funding round prior to 20 April 2020 (no Discount).
- Exit: The convertible loan will automatically convert or be redeemed on an Exit with the Redemption Premium, whichever would give investors the higher cash return. If converted, the loans will convert at the lowest price per share paid in the most recent bona fide equity financing in which the company either (i) raises more than 25% of the total loan amount in new capital after 20 April 2020, less than Discount or (ii) any committed capital raised prior to 1 April 2020.
- Events of Default: The convertible loan is to be repaid on the events of default, such as liquidation or winding up, together with the Redemption Premium.
Republic Co-raise
Fy! is co-raising with Seedrs US Partner, Republic. Investment through Republic is on the same terms offered to Seedrs investors. The investment has been reflected on the campaign page using the exchange rate of $1/£0.8.
The investment round on Republic may be open longer than Seedrs, and so the company may continue to raise funds as part of this round after the Seedrs campaign closes.
Investor Perks
Please note that any discounts, rewards and/or offers listed by a company in its campaign are subject to the terms and conditions applied by that company and listed above. It is the company’s responsibility to honour such discounts, rewards and/or offers and Seedrs does not take any responsibility for them.
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