One of our favorite companies from the most recent Y Combinator batch has closed a seed round. This morning Queenly announced that it has closed a $2.262 million round, following its $800,000 pre-seed raise. TechCrunch covered the company in February, noting that the company was building something akin to the StockX for women's formal wear.
Queenly runs a marketplace that allows individuals and small stores to resell dresses after they've been worn, allowing for more women to access at a lower price point the items they want to wear to a prom, quinceañera or pageant. And as the service could help reduce net clothing waste, it could have a positive environmental impact as well.
The model has continued to find backers. According to co-founder Trisha Bantigue, the biggest check in Queenly's seed round came from Dragon Capital, an investing group that she said quickly saw her startup's potential, investing the day after they met. Notably, the seed round, which Bantigue had roughly half-filled even before its Y Combinator cohort's launch event, did not have a lead investor. Instead, she described her most recent backers as more of a collection of investors that can bring different strategic value-adds to Queenly.
Brightlane Ventures put capital in, for example. Bantigue said that they provide candidate sourcing help. She also cited Amino Capital's analytics knowledge, which will help her company's technical co-founder Kathy Zhou. NextView Ventures also invested, an investor that Bantigue said had deep experience in resale marketplaces and commerce. Interlace Ventures and SHAKTI also took part.
Queenly, long a team of two, intends to expand its staff to six full-time workers with its new funds. That means that Zhou will be supplemented by two more engineers, and Bantigue will be backed up by a head of growth and a head of opps. Six full-time staff isn't many, unless you're starting from a base of two. Then it's a trebling.
Queenly had set out to raise $1.5 million, but wound up raising $2.1 million, a number that grew to $2.262 million by the time that TechCrunch caught up with the company earlier this week.
Notably, Bantigue turned down a larger, $1.5 million check after closing around $1.1 million of the round. Why? She said that Y Combinator and its managing director Michael Seibel had warned her startup cohort against raising too much money too early. And, she explained, her team is more focused on building long-term more "sustainable" growth than short-term "hypergrowth." She cited as a cautionary tale startups that raised lots of capital quickly only to later burn out.
The new capital was raised using a simple agreement for future equity, or SAFE, at a single cap.
Queenly's model of allowing individuals and partner stores resale dresses provides it with two distinct supply sources. TechCrunch asked which is its key driver of growth. Per Bantigue, the partner selling model is still new, but thus far has yielded a simpler, and lower-friction supply source for her company.
TechCrunch was also curious about how the company handles quality, fraud and returns, especially in light of our recent, and illustrative, dive into StockX which has a related set of hurdles to clear.
Bantigue explained that her firm has two main ways that dresses are vetted. For those priced at $300 or less, they ship directly from sellers to buyers, after submitting proof photos of the condition of the dress's components. Those that cost more than $300 are routed through the company's own operation, where it can provide stricter quality control.
With more capital than it has ever had, a growing team and a large market that is largely offline today, the startup should have plenty of room to grow. Let's see how far it can get with this new investment.