糖心视频

The subscription-based model that was widely embraced by SaaS companies and streaming services is now making its way to consumer goods.

, an e-commerce platform that helps consumer packaged goods companies with subscription services, announced on Thursday it raised $100 million in fresh funding led by growth equity firm .

The company works with consumer goods giants like , , and to create subscription strategies, making it easier to retain hard-to-acquire customers in an age where consumers aren鈥檛 tied to their local grocery store, drug store or .

Subscriptions = consistent revenue

Subscription services have long been heralded by the software-as-a-service companies like and entertainment services like and . But Amazon has also rolled out a subscription service for certain home goods such as toilet paper and cleaning supplies 鈥� things consumers need on a regular basis 鈥� at a discount.

鈥淚f people sign up on a subscription to get it on a monthly basis or every three months, the consumer pays less,鈥� said , an adviser at focused on women-centered DTC goods. 鈥淏ut investors like models that are SaaS models where there’s consistent revenue.鈥�

This is key for getting venture investment in consumer packaged goods, a category that became popular with the rise of known, digital-native brands and has since fallen out of favor with the rising cost of customer acquisition and supply chain issues.

Venture funding in the space spiked in 2018 with $21.5 billion, per Crunchbase data. In the years following, that number dwindled to $8.8 billion and hasn鈥檛 fluctuated much since (except for the venture funding banner year that was 2021).

Popular direct-to-consumer brands like and once had the ability to market on social media at an affordable cost. But customer acquisition costs have risen due to policy changes at social media platforms like and companies like which make it harder to track and market to specific consumers without spending insurmountable dollars.

Illustration: Dom Guzman