Scrubs Maker Cleans Up

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A medical apparel startup looking to shake up the $10 billion U.S. industry has raised $5 million from former executives of e-commerce women’s clothier Nasty Gal Inc. and Nordstrom.com, the company announced last week.

The El Segundo business, named Jaanuu for the Hindi word for “sweetheart,” had previously raised $2.6 million in seed money from Brian Lee’s BAM Ventures and Ron Burkle, founder of private equity firm Yucaipa Cos., among others.

Jaanuu, which designs and sells fashionable scrubs for medical professionals and others through its website, wouldn’t disclose revenue.

Co-founder and Chief Executive Shaan Sethi, a former investment banker who previously worked at Yucaipa, said the traditional makers and sellers of scrubs had failed to keep up with the times in terms of fashion and e-commerce.

“The industry was considered by many to be unattractive, whereas we view it as a real diamond in the rough,” said Sethi, 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, which Jaanuu said will help the company add to its staff of 20, was funded by Deborah Benton, the former chief operating officer of Nasty Gal; Dan Nordstrom, former chief executive of Nordstrom.com; 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.

Lee, who serves as an adviser to Jaanuu, said he 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,” he said. “We saw what he was doing and believed in him first and the market opportunity second.”

Benton, who has also advised Jaanuu for the past three years and sits on the board of Venice-based flower delivery startup Bouqs Co., said potential customers include dentists, veterinary technicians, and aestheticians, in addition to those in health care, which the U.S. Department of Labor said in a 2015 report would be the fastest-growing job sector through 2024.

“Not only is it an extremely massive market, it just happens to be the fastest-growing market,” Benton said.

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