- Australian social shopping startup Carted just raised $13 million.
- Its ‘universal commerce’ tool seeks to provide infrastructure for developers and creators to sell other people’s products and turn that into a revenue-generator.
- It’s a game-changer in the space, co-founder Holly Cardew told Business Insider Australia, fixing a problem Instagram has been trying to solve for “the past five years.”
- Visit Business Insider Australia’s homepage for more stories.
To integrate into Instagram’s shopping platform, the team at Instagram have to individually sign on each and every individual business, according to Holly Cardew.
That’s not an issue for Cardew’s startup Carted, which she founded with business partner Mike Angell in 2020, and recently raised a $13 million seed round to take on the social platform — and others in the social shopping space.
“Definitely people in our space know what’s going on,” Cardew told Business Insider Australia.
The infrastructure behind Carted was designed to be directly accessible to developers and creators, connecting them to billions of sellable products through a single application programming interface (API) – the software intermediary that lets apps talk to each other.
Essentially, the Carted API allows a creator or business to generate revenue by selling products from other brands and people without clunky intermediaries like affiliate links.
The company’s latest funding round broke records in Australian startup history, led by Blackbird Ventures, including Mike Cannon-Brookes of Atlassian’s investment office Grok Ventures, Tidal Ventures, Streamlined Ventures, and Lightspeed Ventures’ scout fund.
It also follows investment by founder of shopping rewards platform Honey, Ryan Hudson, which was recently acquired by PayPal for US $4 billion.
‘I saw TikTok was taking off’
When the pandemic hit, Cardew was locked down in San Francisco. It soon became clear there was a massive opportunity to do something new in e-commerce, she said.
Both Cardew and her business partner have a background in the space: Cardew with her other company Pixc, which provides photo editing services for e-commerce platforms, and Angell as an engineer at Shopify and as the chief operating officer of online streetwear hub Culture Kings.
“Mike and I saw TikTok was taking off, and in particular video commerce and social commerce,” Cardew said, referring to the widely reported rush to online shopping during lockdown.
What was different in their case was their unique ability to immediately identify what was missing in the online commerce ecosystem.
The duo founded an initial company, Vop, in 2020, which enabled TikTok to be shoppable for brands and influencers without leading customers to other platforms, but soon realised their tech had the potential to do so much more.
“We wanted to build a multi-vendor checkout experience in one solution,” Cardew said. “But we realised [to do this] we’d have to integrate with every single merchant.”
“So we decided to take that tech that we were providing for Vop, and release it as an API for anyone who wanted to build a new commerce experience.”
She says the infrastructure responds to recent e-commerce trends: the move for content platforms to enable monetisation, and the currently clunky process of linking commerce to those platforms.
Commerce is moving to the platforms, Cardew said, because companies want to get closer to where “the eyeballs are.”
“What we want to basically power is developers to be able to build commerce where consumers are.”
She describes the startup as an engine at the bottom layer which powers the creative layer at the top, connected by whatever software or tools creators are using in the middle.
“For a platform like TikTok or Snapchat, you would be able to buy within the platform without having to, as Cardew says, “integrate with every single brand in the world.”
Ambitions in social commerce
“Revolutionising e-commerce” has been a popular rallying cry over the past 12 months. with the head of content for TikTok in Australia announcing social shopping was her core focus in the market, following from the overwhelming success of live shopping events in collaboration with the social video platform in the US.
Australian startup LinkTree, which gives those with multiple platforms the ability to connect them up through a ‘link in bio’ tool and announced US$45 million in funding at the end of March, said building out its social commerce capabilities was a top priority moving forward.
However even social’s biggest players have struggled to scale up.
Despite two years attempting to make its social “shoppable” via Instagram Checkout with the promise of a seamless experience that would allow consumers to shop for products without leaving the app, Instagram has failed to meaningfully boost conversions for merchants on the platform.
Cardew says Instagram’s growing pains around manually bringing brands on-board was her startup’s golden opportunity.
“Instagram has been building its checkout for five years and they still don’t have every single merchant on board,” she said.
“At the moment they have to go to every single brand and say ‘hey can you sign up, can you integrate with us?’”
“We are basically powering millions of stores through one API,” she said.
One of the main pain points in the space is that “commerce is really fragmented today [and] there is no easy way to build a new commerce app,” Cardew said.
She gives an example of a beauty community that wants to make products it doesn’t own “shoppable” for its audience.
“We want to empower any developer, any founder, any creator or any platform — to turn into a commerce platform.”
“So any content platform today can turn into a commerce platform.”
In a statement announcing the funding, Michael Tolo, principal at Blackbird Ventures explained the significance of the venture as “enabling the first generation of digital-native experiential commerce.”
The ability to sell any product from any merchant on any content platform through direct checkout “fundamentally changes the way we activate commerce through online content and communities,” he said.
“This is not about incrementally improving ecommerce, it is about building the infrastructure to embed commerce within the online experiences.”
‘Australia can compete globally in this space’
Cardew sees the company, in-line with Atlassian, Canva, Linktree and others, as examples of Australia’s ability to create products that can immediately be launched globally.
“That’s what’s an advantage for Australia is we can create companies that sell globally,” she said.
Cardew said she thinks Australians in the start-up space should always pitch with a global mindset, rather than start local.
“That’s what we’re really focused on: global from day one.”
Furthermore, the enormous investment proves what herself and Angell had anticipated; that the buzz about social shopping is now rushing to meet reality.
“First and foremost I’m extremely excited,” she said.
“I think we’re in a really good position with everything that’s going on both following the pandemic and with e-commerce.”