New Investment Opportunity: Tailor Brands
100% ARR growth for AI-powered business branding platform
- One-stop, AI-powered branding and design platform kick starts and scales small businesses online; 32M users in 120 countries; ~9M new freemium users in 2021
- 100% YOY ARR growth to $20M at end 2021, up from 76% YOY growth in 2020; projecting around 100% growth in 2022 and 2023; 65% YOY increase in paying customers to 169K in 2021
- 54% YOY increase in average revenue per user to $18.7 in 2021 from $12.1 in 2020, fueled by expansion of stand-alone services
- Average monthly churn halves to 1.8% in Q4 2021 from 3.8% in Q1 2021
- $25M limited pre-round SAFE with participation from existing investors
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Dear Josb,
New businesses need to establish an online presence quickly and efficiently, with clear branding and an engaging website. Tailor Brands is tailor-made for these small new companies, with automated tools that help turn an idea into a fully functioning business ready for the first customer.
OurCrowd is investing in Tailor Brands. The details here are based on information received from, and verified solely by, the company.
The Company
Tailor Brands is the world's first AI-powered branding platform, making it simple to create a unique online brand identity with no design experience and get up and running in minutes. The company has already enabled more than 32 million people in over 120 countries to kick start and scale their businesses online using a freemium model. The company is adding ~9M new freemium users each year.
The Traction
Tailor Brands' ARR grew by 100% YOY to $20M at the end of 2021, up from 76% YOY growth at the end of 2020. The increase was driven by the addition of new paying users and the expansion of new stand-alone services.
Paying customers increased by 65% YOY in 2021 to 169K. The total addressable market of small startup businesses is estimated at nearly $156B.
The company also saw a 54% YOY increase in average revenue per user to $18.7 in 2021 from $12.1 in 2020. Average monthly customer churn decreased dramatically to 1.8% in Q4 2021 from 3.8% in Q1 2021.
The company added trademark registration, LLC formation and printed apparel services in Q3 2021. Revenue from these stand-alone services, provided on top of Tailor Brands' regular plans, reached $1.1M in Q4 2021, a 277% YOY increase.
The Forecast
The company forecasts further ARR growth of at least 100% per year in 2022 and 2023, driven in part by addition of new services and inorganic growth through a new program of planned acquisitions.
The Round
OurCrowd has a $10M allocation in this $25M SAFE with participation from existing investors. Proceeds will be used to commence inorganic growth and widen the company's product offering.
Meet the CEO
We're hosting a webinar/conference call on Wednesday, March 16th, at 6PM Israel / 12 Noon New York / 9AM San Francisco for investors to meet CEO Yali Saar and learn more about Tailor Brands.
Can't make the webinar? Register and we will send you a recording of the call.
The Tailor Brands Solution
Tailor Brands offers a one-stop shop solution for every micro business, automated and easy to use. The solution autonomously scales and improves its designs by collecting data from its millions of users and applying machine learning. The company has developed proprietary human-computer guidance and design concepts that enable it to offer the best design possible to its customers. The design options grow exponentially due to no template usage, allowing for maximum personalization at a minimum cost.
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