After breaking onto the beauty scene in 2010, Birchbox has come to be known as something of a wild success in the world of sample subscription startups. And it's about to get even bigger: The startup has raised $60 million in venture capital funding led by Viking Global Investors, en route to opening its first brick-and-mortar store and making further moves internationally.
While the majority of Birchbox's revenue comes from the monthly boxes that it sells to its subscribers — filled with sample-sized potions like Embryolisse cream and Eyeko mascara — about 30 percent of sales come from the full-sized products that the startup sells on its site. And that's the whole point: Subscribers receive boxes of products tailored to their beauty needs, and then they will buy what they like through the site.
Clearly Birchbox is doing just fine. So where will this funding go? Mostly towards scaling up its operations in a big way. The startup's brick-and-mortar store is scheduled to open on West Broadway in late May. Like other online companies before it (Warby Parker, Bonobos), the Birchbox store is meant to create a new kind of shopping experience — in this case, a space for product sampling, instruction and, yes, hand-picking products for one's own box.
International is also a potential area of expansion for the company. It has already made some moves abroad, including scaling its operations by acquiring a copycat business in Paris, JolieBox, which had already acquired a competitor in Spain. If Birchbox does expand again, it will be to countries that are nearby to those it already operates in. Canada could be up next.
Perhaps the most interest news that comes with this funding announcement is the possibility of Birchbox developing and selling its own range of products. This is risky — the startup already sells so many good brands that it's set a high bar for quality — but Birchbox also has a ton of data on what its consumers like and, more importantly, still want. Those are some products we'd be happy to test drive any day.