Clean Lines: Neela Sethi Young, in Jaanuu scrubs, with Shaan Sethi.

Clean Lines: Neela Sethi Young, in Jaanuu scrubs, with Shaan Sethi. Photo by Ringo Chiu.

A medical apparel startup looking to disrupt the industry has raised $5 million from investors, including former executives from ecommerce women’s clothier Nasty Gal Inc. and Nordstrom.com, the company announced Wednesday.

The El Segundo-based company, named Jaanuu for the Hindi word for “sweetheart,” had previously raised $2.6 million in seed money from investors including Brian Lee’s BAM Ventures and Ron Burkle, founder of private equity firm Yucaipa Companies.

Jaanuu, which sells fashionable scrubs for medical professionals through its website, wouldn’t disclose revenue, but said it was looking to tap into what it called a “$10 billion market.”

“The industry was considered by many to be unattractive, whereas we view it as a real diamond in the rough,” said Shaan Sethi, Jaanuu’s chief executive who co-founded the company with his sister Dr. Neela Sethi Young in 2013. “The perception is a lot of the competition is behind the eight ball.”

The latest round was funded by Dan Nordstrom, the former chief executive of Nordstrom.com; Deborah Benton, the former president and chief operating officer of Nasty Gal; Innovation Global Capital, a San Francisco investment firm founded by Yasunobu Kyogoku, the former chief operating officer of Japanese retailer Uniqlo; and Sipadan Capital, a New York investment firm.

BAM Ventures’ Lee, who serves as an advisor to Jaanuu, was attracted by the company’s organic growth, which it has achieved through a combination of digital advertising and interacting with customers on social media. The company has almost 195,000 Facebook followers.

“Shaan built an amazing business in a short amount of time without a lot of capital,” Lee said. “We saw what he was doing and believed in him first and the market opportunity second.”

Jaanuu, which has 20 employees, will use the money to hire more people, including Derrick Dinglasan, director of product management at baby product maker Honest Co., which Lee co-founded in 2011, and from which he stepped down as chief executive last month.

“Early on, the capital was used to finance the inventory,” Sethi said. “We haven’t been a stranger to being sold out on our site. This will be the first time the business is well positioned to put the pedal to the medal.”

Staff reporter Caroline Anderson covers retail, restaurants, and hospitality. She can be reached at canderson@labusinessjournal.com.