BloomNation raises $1.65M to disrupt floral industry

The $34 billion category dominated by 1800Flowers has a new contender

In a world where new middlemen are emerging across all industries one would eventually have to blossom in the floral industry.

And one has. BloomNation, a Los Angeles-based marketplace connecting conumsers with local artisan florists, announced it's raised $1.65 million in funding from Andreessen Horowitz, Spark Capital, Chicago Ventures, CrunchFund and MuckerLab, where it was incubated earlier this year.

"The idea is we’re building a community to allow consumers to find unique floral designs," said Farbod Shoraka, CEO and Co-Founder of BloomNation, whose background is in investment banking, having worked on deals that led him to understand the big floral giants, such as 1800Flowers, the standard of this $34 billion category. 

Shoraka explained that the florists don't have an incentive to do their best job and the consumer may or may not receive the flowers they chose. And that's a problem. Here's how it works. "1800Flowers puts up a catalog and a consumer clicks flowers to buy. Then 1800Flowers routes that order to a local florist. But they don't know if a florist has those flowers. A lot of times they'll cut corners," Shoraka said. In this instance, which happens often he said, florists aren't delivering their best and customers aren't receiving what they ordered.

The reason this happens is because florists are anonymous to the consumer so they don't have accountability to the consumer nor do they have incentive to keep that consumer from going back to them. Sure, they have incentive to keep 1800Flowers happy. But the big floral giant typically takes a 50% fee, meaning the local florist gets 50% of the retail price, said Shoraka.

With BloomNation, local florists would be visible to the consumer so consumers can have a relationship with them directly and build customer loyalty. They also receive 90% of the commission. BloomNation provides a turn-key presence that allows florists to build a website, have a shopping cart and have social marketing tools. There's also nice-to-have features like allowing florists to take a snapshot of the flowers and send to the customer just before they're ready to be shipped out.

By giving up only 10% of the retail price, a local florist would be hard-pressed to give up all the tools that BloomNation provides. And for consumers, BloomNation also opens up the door to many other potential florists and not just the 20,000 brick-and-mortar ones across the country that can often be expensive. 

"We're empowering a lot of studios and wedding and event florists by giving them a virtual store," said Shoraka.

Today, BloomNation has 2000 florists in about 3000 cities.