interior define investor pitch deck - series a ($2.7m raised to date)
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May 2014 | Private & Confidential
INTERIOR DEFINE IS CHANGING THE WAY PEOPLE SHOP FOR FURNITRE.
• Multi-channel• Vertically-integrated: better pricing and
deep product personalization• Reference-generating customer service
© 2014, Interior Define, Inc. Confidential
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The $71B furniture market is highly fragmented -- and rapidly moving online
“We don’t yet know what constitutes online saturation – but there might be a clue checking out the behavior of more prosperous consumers. The most affluent customers do 63% of their furniture spending online.”
- McKinsey
2013E 2017F$0
$20,000,000,000
$40,000,000,000
$60,000,000,000
$80,000,000,000
$100,000,000,000
$62B $71B
$9B
$13B
Physical Online
“34% of customers don’t mind not touching / seeing the furniture before its bought.”
- Mintel
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© 2014, Interior Define, Inc. Confidential
Despite the market size & opportunity, there isn’t a Warby Parker or Bonobos of furniture
Low Price
High Price
Low Quality
High Quality
Gap in Furniture “The Next Big eCommerce Wave: Vertically Integrated Commerce.”
–TechCrunch
“Design interested clients are going to insist on knowing the story and the sources; they want to participate.”
– Holly Hunt
“We’re entering a new era in which customization will lead a number of consumer product categories, creating value for buyers and sellers alike.”
– Mashable4© 2014, Interior Define, Inc. Confidential
Our unique supply chain that eliminates middlemen & unnecessary markups
1. We produce items on-demand (negative working capital model) with carefully selected partners
2. Our experienced overseas team carefully inspects & packages every item
3. We ship directly to consumers in the US; in competitive lead times for made-to-order furniture 5
© 2014, Interior Define, Inc. Confidential
Which enables us to offer Room&Board quality at West Elm (and lower) prices
Kelley sofa $1,800 (including delivery)
• 106” length• Kiln-dried hardwood frame• High-resilience foam & goose-down
seating• Extra padding on arms and frame• Woven polyester fabric• Unique, full-chaise arm• Hardwood legs
Easton sofa $2,698 (before delivery)
• 106” length• Hardwood frame
(unspecified)• Spring and down seating• Thin arms• Woven polyester fabric • Half chaise arm• Plastic legs 6
© 2014, Interior Define, Inc. Confidential
Consumers are excited about our customization proposition
Sales0%
10%20%30%40%50%60%70%80%90%
100%
40%
41%
19%
Upholstery Customization
Structural Cus-tomization
Standard
ID Customization (as % of sales)Customization Options
Upholstery
Size & Configuration
Legs
© 2014, Interior Define, Inc. Confidential
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We meet customers where they want to shop
E-commerce website22%
Showroom experience52%
8
Swatch Mailer26%
© 2014, Interior Define, Inc. Confidential
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2$0 K
$50 K
$100 K
$150 K
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427 28 33
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7896
115129
166
203
Sales Actuals and Projection ($K)
ID Actual ID Forecast Bonobos
2014 ID sales projection:
$1.06M
YTD Sales (as of 5/16):
$121K
Customer Groups %
Showroom 52%Online-Swatch assisted
26%
Online Only 22%
ID actuals
We project $1M in 2014 sales based on ramp similar to relevant, lifestyle brands (Bonobos)
© 2014, Interior Define, Inc. Confidential
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“there's a large swath of consumers who feel they have
graduated from Ikea furniture but can't afford to shop at high-end
design stores.”
“Interior Define is an upholstered furniture business
poised to disrupt the industry.”
“Things We Love: Make your home your own with
customizable high-end furniture at affordable prices.”
“Interior Define Doesn’t Just Design Chairs, They Create
Works of Art”
“you can get a sofa that looks like it cost at least $2,500 for
about $1,600.”
Consumers & media are excited about our brand proposition
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“Interior Define is here to save you from
sofa regret.”
© 2014, Interior Define, Inc. Confidential
Our Team
Steve McClearn / CEO. Former VP of home appliance eCommerce & strategy at Sears. MBA Harvard Business School. Rob Royer / Founder & Head of Brand. Former Director at Draftfcb; Director of CRM at Bonobos. MS Integrated Marketing, Northwestern Univ.
Adam Rosen / GM of China office. Former Chinese Logistics & Sourcing Analyst at Target. BS Chinese, George Washington University.Jeff Osowski / Director of Operations. Former Bain Senior AC. BS Finance, University of Notre Dame.
Andy Dunn / Founder & CEO of BonobosGary Kohler / Chief Investment Officer, Blue Clay CapitalPeterson Ventures / Founded by Joel Peterson, Chairman of Jet Blue.Brendan Wallace / Former CEO of Identified – led successful exit.
Executive Team Advisors & Investors
Key Team Members
Proudly run in Chicago by a team of design junkies, brand zealots, techies, foodies, supply-chain aficionados, reformed consultants, and champions of exceptional experiences. 11
© 2014, Interior Define, Inc. Confidential
APPENDIX
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© 2014, Interior Define, Inc. Confidential
About Us• A new, vertically integrated e-commerce furniture brand
• Raising funding through a convertible note with a $2.25 million note cap. Participants include Peterson Capital and experienced e-commerce angels
Our Unfair Advantages• A supply chain that has been tested & proven over five years
• Highly involved investors & board members with exceptional ecommerce & brand experience: – Andy Dunn, Founder & CEO of Bonobos– Clint Peterson, Peterson Capital. Fund founder Joel Peterson, CEO of
JetBlue, Stanford GSB professor, and initial investor in Bonobos– Adam Wright, hedge fund, early Bonobos investor
• Leadership team with solid operating, brand, and ecommerce experience (coming from companies like Bonobos, Sears, Target, and Bain)
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© 2014, Interior Define, Inc. Confidential
The Problem: Design-conscious consumers aren’t satisfied with the current retail furniture options.
$2,698
Retail Operations: $512 (19%)
Other SG&A: $728 (27%)
Cost of goods: $1,268 (47%)
Profit: $189 (7%)
Retail Furniture
Direct (e.g. Room&Board)
Consumers are spending more time comparison shopping and looking for value. This has led to increased use of the internet, especially on mobile devices, as not only a research tool but as a channel for purchase.
– Euromonitor 2014
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Cost of goods:$1,130 (63%)
Retail Operations: $80 (4%)
Other SG&A: $320 (18%)
Profit:$270 (15%)
$1,800
© 2014, Interior Define, Inc. Confidential
Our value proposition fills a void in the market: Room&Board design & quality at West Elm (and better) prices
Splurge
$$$
Aspire$$$$$
Save or Settle
$
Best Current Option
$$
ID Prices
ID Design & Quality
Design- and quality-conscious consumer consideration-set in the fragmented US market.
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© 2014, Interior Define, Inc. Confidential
Marketing channelsEditorial PR Design Partnership
Social Paid
• Creates awareness and credibility• Spend: $8k/month
• Credibility and traffic• Spend: Minimal (rev share)
• Houzz and Pinterest. Includes paid placements
• Spend: $8k/month
• Targeted at consumers known to be in market. SEM, Shopping engine, mailers
• Spend: $15k/month
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© 2014, Interior Define, Inc. Confidential
Proposition: Designer-quality furniture at prices (actually) within reach.
Price Friendly
• No middlemen
• e-commerce driven
• Lean operating model
Furniture Made Simple
• Curated designs
• Easy personalization
• High-touch fulfillment
People Loving
• Bonobos-like customer service
• 365-day returns
• Delivery concierge
Brand Pillars
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© 2014, Interior Define, Inc. Confidential
“Great job on the website…it reminds me of a hybrid of Restoration Hardware (the photography with the exposed commercial equipment etc.) and Design Within Reach with a twist of Ligne Roset!” -- Jay Michael, Lifestyle Developer on Bravo
-- Diana Bitting, Editor of Modern Luxury Interiors
“I want you to know how refreshing it is to find fair pricing, innovative furniture and a personable business. WOW! I'll be sure to tell all of my mommy friends about your website and philosophy. I'm so impressed.”
-- Customer email
Consumers (and influencers) love our product & brand proposition
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© 2014, Interior Define, Inc. Confidential
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