Sometimes we need the perfect way to say "I love you" or "I'm thinking of you," or even "I screwed up!" But what happens when the flowers you send don't resemble what you paid for? Start-up BloomNation hopes to nip that in the bud.
"At the end of the day we ended up getting something that was delivered in a box or looked nothing like we saw on the Internet. We got so tired we had to do something about it," pitched co-founder David Daneshgar.
Daneshgar along with co-founder Farbod Shoraka had 60 seconds to pitch their big idea to our panel of experts including: Jenny Lefcourt, Freestyle Capital Investor and founder of the WeddingChannel.com, Kent Bennett, Bessemer Ventures Partner, and Eurie Kim, Forerunner Ventures Principal. Watch the video to find out if they were in or out!
Poker to Petals
Back in 2011, Daneshgar, Shoraka and a third co-founder, Gregg Weisstein, decided there was an opportunity to revolutionize the flower industry, but they lacked the funds to make it a reality. As a bracelet winner in the 2008 World Series of Poker, Daneshgar knew he could help out. There was an upcoming poker tournament with a first place prize of $25,000. Daneshgar went for it—and won.
The founders used the winnings toward design, development and sales, and the following year they launched BloomNation.com.
The website works like a search engine. Customers input their ZIP code and filter results by occasion, color, flower type and style. The founders say no stock photography is used on the site and all the photos are the florists' actual work. When a purchase is made, BloomNation takes a 10 percent cut from the transaction.
"You're able to shop these florists' actual arrangements that represent their brand, rather than only being able to shop stock images that you find on other sites," Shoraka told CNBC. "Using other sites can even mean you're getting the florists' leftovers of flowers because there is no way for the florist or you to find out who each other are."
BloomNation also offers customers a feature called "BloomSnap," where the florist sends the customer a picture of the completed arrangement before it goes out for delivery.
The company even accepts bitcoin.
But panelist Jenny Lefcourt was concerned about revenue, and asked if the founders envisioned any other revenue sources beyond the 10 percent transaction fee.
"Supplies for the florist have become a big area for us to focus on," said Shoraka. The company plans to allow suppliers and wholesalers to list and sell its products directly to the florists.
Growing in a competitive industry
BloomNation faces steep competition from industry heavyweights like 1-800 Flowers and FTD Cos. and the panelists expressed concerns about BloomNation brand awareness.
"We're going a different route of partnering with florists and having them become our marketers," said Shoraka. Daneshgar added, "We have one-fifth the revenue, but so far we've actually had zero acquisition costs."
"The cool thing about the florist industry is that all the florists know each other. And so we've created incentive programs as well for the florist. So they're actually referring their friends in smaller cities," Daneshgar said.
The site currently has more than 2,500 florists, who all hand deliver to over 3,000 cities nationwide. While the founders would not reveal revenue numbers, they did say revenue is growing between 10 and 30 percent month over month.
So far they have raised $1.65 million from investors including Andreessen Horowitz, Spark Capital, CrunchFund and Chicago Ventures.
See David Daneshgar and Farbod Shoraka power pitch their big idea to CNBC host Mandy Drury and panelists: Jenny Lefcourt, Freestyle Capital Investor and founder of the WeddingChannel.com, Kent Bennett, Bessemer Ventures Partner, and Eurie Kim, Forerunner Ventures Principal.
—By CNBC's Erin Barry
—Comments, questions, suggestions? We'd love to hear from you. Follow us @CNBCPowerPitch and join the #PowerPitch conversation