If you’ve seen the ads for Soap.com on the subway or noticed a growing number of deliveryman hauling boxes with the Soap.com’s colorful logo into apartment buildings, that’s Quidsi. It’s the same Jersey City company behind the mega-successful delivery sites Diapers.com (for baby care), BeautyBar.com (cosmetics) and Wag.com (pet care). Soap.com sends you stuff you don’t have time to pick up from the drug store.
It’s e-commerce play in an app economy that may be more closely associated with the dotcom era, except, you know, with much better margins. Quidsi, launched by friends Marc Lore and Vinit Bharara, is also known for its Zappos-rivaling customer service and rapid-fire delivery times, a particular obsession of Mr. Lore’s. That might be why Amazon, which owns Zappos, purchased Quidsi for $545 million last November.
Quidsi is now a wholly-owned subsidiary, but operated independently from Jersey City. Betabeat talked to Mr. Lore about the right reasons to sell, what he misses (and doesn’t miss) about startup life, his angel investing philosophy, and his latest vertical, YoYo.com for kids toys, which launches today.
A lot has changed since the last time we spoke!
The strategy of Quidsi remains the same. Basically it’s all the disposables shipped to you—70 percent of the country overnight–and the rest in two days, so super fast ship times, great return policy 365 day no question asked, average speed of answer continues to come down on calling customer service. We believe we have the right model of getting all the benefits of a mass merchant by having a shared shopping cart and shared account and a shared shipment, but all the benefits of a specialist by having these different websites where we can really take advantage from a merchandising standpoint by tailoring the taxonomy to the specific vertical.
So you’re using the same shippers and warehouses for economies of scale?
Yeah exactly, we leverage all that on the back end. On the front end, we have these very specialized, personalized designed sites. For example on YoYo, we’ll have hand-picked and child-tested toys that we think are great by age, so if you’re looking for a quick gift, it will be easy to find the top toys in any price range or age group. We have a really interesting toy finder that really takes the user interface to a whole ‘nother level—the wish list functionality and stuff. Moms that are already shopping with us on a regular basis will now be able to add to their basket seamlessly–up to 20,000 toys.
How’s Soap doing right now? I’ve been seeing a lot more boxes delivered to condos in Brooklyn.
Soap’s doing great. It’s a little over a year old and it’s way ahead of where Diapers was and Wag is doing better than Soap did in its first two months. So each site seems to be doing better than the one before it.
Do you have any metrics you can share?
You know I love to share that stuff, but I can’t really, now that we’re part of Amazon, give you any financial details. Quidsi is the holding company that Amazon acquired and home to all the different brands. Along with the launch of YoYo today, we’re launching our corporate site, Quidsi,com, which will give background into all the brands and culture of the company.
How does the arrangement with Amazon work?
We operate fairly independently here out of the East Coast. They’ve given us some leeway here to carry our vision as we laid it out. We’re pretty happy about the way things are going. You definitely have oversight, but they’re given us a lot of rope to execute the vision that we’ve put forth.
I noticed you ventured into angel investing recently. Is that something you’re going to be doing more of?
Yeah, it’s definitely something I hope to be doing more of.
You and Vin invested together, right?
Yeah, Lot18, they’re a great company, I think they’re going to do really well.
What are the type of startups you’re looking to invest in?
I don’t think there’s any one thing we’re looking for expect for a small team with a big upside potential and a lot of momentum, but I think the team is the only constant that you’ll find across our investment.
Do you plan on staying with Quidsi longterm?
Yeah, we have no plans to leave. We’re still having fun, we want to see this vision all the way through. There are a lot more sites in the pipe that we want to see launched.
Why do you think Quidsi has fared well as an M&A deal for Amazon?
I think they probably bought us and we probably sold for all the right reasons. It’s a good marriage. A lot of times companies buy companies and don’t know why they buy them or they do, but they want them to change how they were operating, which always causes friction. That hasn’t been the case.
What were the right reasons to sell?
We saw an opportunity with Amazon to increase the probability of getting there and to increase the speed at which we could get there. It’s kind of hard to pass up the opportunity. I’d be lying if I said it was exactly the same. There are certainly things that you miss, but on the flip side, there are things that I don’t miss.
What don’t you miss?
I don’t miss having every year to go out and raise money and go out and sell the VC community and to deal with all the aspects of going through the process of raising money. I don’t miss that. I do miss the excitement and risk-taking element that comes with whether you’re going to make it or not or raise the money you need—the unknowns.