Teespring’s comeback story

Startup stories are often too reductive — an entrepreneur dreams up an idea, snags some co-founders, raises a bit of money, and presto: success and riches.

It’s nearly never true. Even breakout successes like Slack that may feel straightforward have complicated stories. Amongst the most valuable startups there are hidden crises and disappointing quarters. Some famous startups even had to execute a hard pivot after their original idea flopped. Slack was originally a gaming company, Twitter was a podcasting platform and YouTube wanted to be a dating service.

But not all startups that struggle and eventually make it have to completely toss out their original idea. Some just need to shake up operations before seeing the sort of success they’d hoped for.

Social e-commerce and fulfillment platform Teespring is one such company.

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From a 2017-era round of layoffs and restructuring, the company is on an impressive, profitable growth curve today.

I was part of the reporting team that covered the company’s earlier struggles, which came after it raised more than $50 million in venture capital. So when Teespring wanted to discuss the numbers behind its recent growth, I was more than curious.

This morning, let’s look at how one startup found its groove a few years after we’d figured it was a done deal.

A comeback

Rewinding the clock, Teespring’s 2017 was a difficult period. The company had sharply cut staff as sales declined, cost reductions that helped push the startup from regular deficits into profitability.

At the time, reporting indicated that Teespring’s revenue fell off after it lost some power sellers and investments in goods other than T-shirts failed to materially improve its financial results. After the layoffs, Teespring raised $5 million at a diminished valuation to get back on its feet.

Printify raises $3M to expand its marketplace for custom printing

In Riga, Latvia, an 80-person startup called Printify is reimagining the on-demand printing business.

Gone are the days where small merchants have to sell their customized products on platforms like Zazzle, Society6, CafePress, or Teespring . Using Printify, e-commerce business owners can create clothes, accessories and more fixed with their designs, logos, art or photos, then sell them directly on their very own online stores.

The “first wave” of on-demand printing companies, Printify founder and chief executive officer James Berdigans explained to TechCrunch, typically require that merchants sell their items on the provider’s platforms.

“The problem is that these merchants don’t have the capability to build their own brand,” Berdigans said. “At the end of the day, you end up building the Teespring brand, not your own brand.”

Printify, a graduate of the 500 Startups accelerator, has attracted a $3 million investment from Bling Capital, a venture capital fund launched five months ago by Ben Ling, a former general partner at Khosla Ventures.

“Printify is perfectly positioned to enable the new trend of micro and boutique brands,” Ling said in a statement. “Consumers and SMBs alike can benefit from Printify’s high-quality, low-cost, and fast printing platform — and create their own micro-brands.”

Founded in 2015 by Berdigans, Artis Kehris and Gatis Dukurs, Printify had previously raised a $1 million round following a big pivot. Initially, the business “pretended to be the manufacturer,” opting to be less transparent as a means to entice customers.

“That was a terrible idea,” Berdigans said. “Even though you aren’t lying, you end up not being a very honest company and that’s not the business model we wanted.”

Now, Printify operates as a B2B marketplace that connects manufacturers with ecommerce stores. Plus, the startup handles the mundane tasks of fulfilling orders, including billing, manufacturing requests and shipping so store owners can focus on brand building. The switch allowed the startup to begin growing 30 percent year-over-year, as well as add hundreds of unique products to its catalog.

The founders say Printify most often caters to political campaign employees, designers & artists, and influencers & “hustlers,” or people who are self-taught experts on managing digital sales. With a fixed pricing scheme, merchants know exactly what they are paying Printify but have the flexibility of pricing their own product. Other print-on-demand marketplaces, like the aforementioned “first wave” businesses, don’t give merchants the ability to determine their own margins.

“If you use Zazzle, for example, you only get a small portion of revenue share but on Printify, you pay us a small fee,” Berdigans said. “If you were selling t-shirts for $25 and the average production cost is $10, our sellers will see a 50 to 60 percent margin.”

Dozens of angel investors, including YouTube co-founder Steve Chen, Twitch co-founder Kevin Lin, ClassPass co-founder Fritz Lanman, DoorDash co-founder Evan Moore, Google AdSense pioneer Gokul Rajaram and Facebook’s vice president of product Kevin Weil, also participated in the company’s latest round.

“What Airbnb did for the hospitality industry, that’s basically what we can do for the print-on-demand industry,” said Kehris, Printify’s chief operating officer.

Lattice raises another $15M to improve performance reviews

Sam Altman’s little brother Jack is an entrepreneur, too.

Jack Altman, whose resume includes a stint as vice president of business development at Teespring, has raised $15 million in Series B funding for his startup, Lattice, a modern approach to corporate goal setting. Shasta Ventures led the round, with participation from Thrive Capital, Khosla Ventures and Y Combinator, the latter being the organization his brother led as president until very recently.

Lattice, used by high-growth companies like Reddit, Slack, Coinbase and Glossier, helps human resources professionals develop insights about their teams. Founded in 2015, Altman and Eric Koslow, like most entrepreneurs, developed the idea for Lattice out of their own pain points.

“We realized that with quarterly goal settings, OKRs, we would write them up and get the leadership together and then they would sit on a shelf and nothing would happen,” Altman told TechCrunch.

Lattice, a SaaS business, is a flexible platform that caters to startups and larger businesses’ specific cultures, management practices and varying approaches to employee engagement. The product, inspired by platforms like Gmail and Slack, is designed with consumers in mind. Lattice, the team hopes, has a look and feel that makes incumbent HR platforms feel antiquated. 

The product makes it simple for employees and their managers to complete engagement surveys, share feedback, arrange one-on-one meetings and complete comprehensive performance reviews with a larger goal of reworking the company goal-setting process entirely. No more once-yearly check-ins; Lattice enables businesses to check-in with their employees on a weekly basis. 

Lattice currently has 1,200 customers, 60 employees and was cash flow break-even for the first time in Q1 2019. With the latest financing, the San Francisco-based startup plans to invest in product development.

“Life is short,” Altman said. “You want to have work that you enjoy and an office that feels good to be at.”

Lattice has previously raised capital from investors including SV Angel, Marc Benioff, Slack Fund and Fuel Capital, Sam Altman, Elad Gil, Alexis Ohanian, Kevin Mahaffey, Daniel Gross and Jake Gibson. Lattice completed the Y Combinator startup accelerator in 2016.