PayPal Ventures Leads US$11 Million Funding Round For Retail Service Provider Happy Returns
The venture capital arm of online payments giant PayPal, PayPal Ventures, reportedly led a US$11 million investment round for the online returns service firm Happy Returns. The investment marks the largest funding round for the relatively new retail services startup, which has so far raised more than US$25 million.
Apart from PayPal Ventures, other firms involved in the funding round included Upfront Ventures and US Venture Partners. The exact amount of the companies' participation was not detailed.
Happy Returns, which was founded by retail and e-commerce veterans Mark Geller and David Sobie, offers retailers comprehensive online returns service solutions. The company has established hundreds of return kiosks with global retailers in convenient locations around the country. The firm also develops advanced returns software along with its reverse logistics services.
The company's founders revealed in a statement that the substantial investment to their company is a big deal for them and that they are taking on the challenge that PayPal has placed in front of them. The challenge for the company is apparently to make e-commerce transactions as easy and as "frictionless" as possible through impeccable service and return policies.
As of the moment, the company currently has around 350 "Return Bars" located in major malls and colleges around the country. They have established themselves in convenient locations for shoppers such as Cost Plus World Market and Paper Source. The service the company provides is particularly useful for online brands that currently do not have brick-and-mortar stores. Larger retailers can also benefit from the service, given their well-optimized routing systems.
According to PayPal's North American VP, Robert Clarkson, the firm sees a lot of potential with Happy Returns given how they have managed to revolutionize the retail market's return process. The company's services have so far made the return process as cost-effective and as efficient as possible for hundreds of merchants. PayPal is apparently happy to be working with the startup, which they hope would be able to address the growing returns problem facing countless merchants.
As retailers transition their businesses online, returns have become a major problem for some. According to Happy Returns, more than 15 to 40 percent of online shoppers return the products they buy online. This is drastically larger than the 5 to 10 percent of buyers from physical stores. Most online retailers typically use traditional mail for their returns, a practice that is inefficient and time-consuming. Happy Returns solves that problem by offering to handle every step in the process at the lowest possible cost.