The Top Companies Disrupting Retail
The seventh annual “Disruptor 50” list is out, spotlighting private companies whose innovations are “changing the world and fueling a race between superpowers like the U.S. and China."
The CNBC list ranks venture capital–backed companies, noting 36 disruptors this year are unicorns that have already reached or passed the billion-dollar mark. In aggregate, the 50 companies on the list have raised over $46 billion in venture capital, according to PitchBook data.
Amid this impressive collection of biotech, machine learning, agriculture companies and more, land four retailers re-shaping the industry. Read on to learn about each of these innovative retail start-ups filling unexploited niches in the retail market.
(5) Rent the Runway
When Harvard Business School classmates Jennifer Hyman and Jenny Fleiss, an RIS 2019 Top Women in Retail Tech winner, started Rent the Runway, their concept was simple, but it has evolved into much more. Rent the Runway (RTR) launched in 2009, and continues to set itself apart as an innovator. In May, the online fashion rental service pushed bigger into brick and mortar with the opening of its largest store yet. The 8,300-square-foot West Coast Flagship is its fifth location, featuring the new RTR Pick-Up Station, which allows customers to pick up orders without having to wait in line, RTR Drop-Off, which allows them to return rented items within a few seconds, and RTR Self-Service checkout, which enables them to check out with their RTR Pass on their phone. The store also includes perks like a complimentary coffee bar and beauty bar.
In addition, in April RTR announced it was going to start offering clothing for girls sizes 3Y to 10/12Y from designer brands. In March it partnered with West Elm to make its home accessories available for rent, which marked the first time RTR has expanded outside apparel and accessories. While there has been talk of an IPO, the company has yet to confirm a date.
The online mattress retailer, which also appeared in RIS’ 10 Hot Retail Startups, has disrupted the segment since its 2014 launch, redefining what the mattress buying experience can and should be. Now, Casper has more than 1 million customers and last year did $400 million in revenue, CNBC reports. In March it raised another $100 million in funding, bringing its total to about $340 million.
But the company’s first order of business was creating a streamlined product array, coupled with a simplified merchandising effort. The retailer developed a unique fulfillment method where a queen-size mattress gets delivered in a box the size of a standard kitchen trash receptacle. Now Casper has expanded into 20 retail stores around the country and says it has plans for 200 more, in addition to its retail partners, which include Costco, Nordstrom, Target. Its “Dreamery” locations are not prototypical stores ― no mattresses are sold there ― it is simply an opportunity for people to interact with the brand and experience the product by scheduling a nap on one of Casper’s cutting-edge mattresses.
While DoorDash isn’t a retailer itself, the six-year-old food delivery company partners with more than 300,000 restaurants, including Applebee's, Red Lobster, and Subway, to bring their food to shoppers’ doors. DoorDash empowers merchants to grow their businesses by offering on-demand delivery, data-driven insights, and better in-store efficiency. CBNC reports the company has raised $1.4 billion, including $400 million in February, and that its service is available to 80% of the country across 3,300 cities. In March the company launched a new initiative, called Kitchens Without Borders, which spotlights the human stories of immigrant and refugee business owners that DoorDash partners with and aims to inspire people to support these small businesses.
E-commerce retailer Fanatics sports exclusive licensing deals to make and sell official team merchandise, such as hats and jerseys. Launched in 2011, this year the company clinched a deal with Walmart to sell NFL jerseys, NBA T-shirts and other sports-related merchandise on Walmart.com. Under the partnership, Fanatics will be the exclusive provider of all licensed sports merchandise on Walmart.com.
Fanatics’ uses a proprietary sales system known as “Cloud Commerce,” to track every click, search, and purchase on every site run by Fanatics, as well as emails, ads, and sales from physical stores. Cloud Commerce monitors social media and the news for information on players, which helps inform the company’s retail decisions. The system automatically re-ranks products and flags unusual events. Fanatics reportedly does about $2.3 billion in annual sales but is projecting $10 billion over the next five years with a major expansion globally, and has raised $1.7 billion in funding, CNBC reports.
On-demand technology platform that allows trucking companies and shippers to connect via an app instead of relying on a broker, which utilizes email or phone calls.
Companies, including Amazon, Google, and Under Armour, use Stripe's software tools to securely accept payments from anywhere in the world.
Kabbage claims that in three steps — and in under 10 minutes — a small business can apply and be approved for a credit line of up to $250,000.
20. YITU Technology
This Shanghai-based company’s artificial intelligence technologies are utilized in industries such as public safety, health care, banking and retail.
This start-up is a global freight forwarder and customs broker powered by cloud software and an analytics platform.
Affirm uses proprietary algorithms at the point of sale to determine a person's creditworthiness.
C3’s software can read data and tell a product’s owners if something is about to break down, or the most efficient ways to use sensor data in their supply chain management.