Responses from Chief Executive Chris Davis
How has your company evolved since it was founded?
Just about everything has had to evolve since we founded the company, except our desire to curate the best possible experience for fans of pop culture, gaming, and entertainment. We’ve grown from a handful of folks packing crates in the same space that we built the business to expanding our headquarters and warehouse spaces. We’ve also improved and expanded our partner relationships to include some of the biggest names in entertainment like Marvel, Harry Potter, WWE, Halo, and Sanrio. Finally, we’ve expanded from one product to 16 product lines serving all types of fandom.
BUSINESS: Monthly themed mystery crates
TWO-YEAR REVENUE GROWTH: 2,953 percent
2015 REVENUE: $116 million
How has the company been funded?
Loot Crate was founded with an initial friends and family investment of $25,000. We’ve bootstrapped an incredible amount of growth over the course of our first three years. This year we secured $18.5 million from venture capital firm Upfront Ventures; private equity group Breakwater Investment Management; magazine publisher Time Inc.; Robert Downey Jr. and Susan Downey’s investment fund; and the venture fund of the owner of the New York Mets, Sterling Equities. We are using this investment to expand our product offerings, strengthen our technology platform, and drive international growth, which will allow us to deliver the Loot Crate experience to a much wider audience.
What did you do to achieve this rate of growth?
Grassroots community building. Fostering an authentic, nontransactional relationship with our customers through social platforms, original content, and through our shared love of pop culture really helped separate us from competitors.
Who were your key advisers in the process?
We built a network of advisers with diverse backgrounds in product development, venture capital, entertainment, and retail that we could call upon for guidance. The team also had friends and family who were always willing to listen and help think through opportunities and challenges we faced. We also looked to the blogs and books of top entrepreneurs for great tactical and strategic insights.
How did you manage the growing workload?
We started thinking about how to structure the company and organizational design very early on. We grew from a handful of employees to more than 300. We’ve moved several times to accommodate the space needed to house all of the product we send to our growing subscriber base. We also realized we needed to bring in an experienced leadership team who could help us scale the organization and bring new perspectives to Loot Crate.
What were the biggest obstacles hindering your growth and how did you overcome them?
Finding and retaining talented people is the No. 1 priority for sustaining growth.
Is there still room to grow in your current market or will you seek to expand into new areas?
We’re looking at both opportunities – we currently have strong sales internationally but have just launched our first international office in London to develop the same community and brand presence we have built in the U.S. Also, we are looking at the most passionate communities of fans and developing new ways Loot Crate can provide a unique experience delivered to their mailboxes and inboxes.
How do you manage expectations going forward?
For our customers, it’s about staying true to our love of everything geek and gamer while expanding into new spaces of fandom. Passion is everywhere and we think Loot Crate can bring joy to many more audiences.
How has your location in the L.A. area played into your company’s growth?
Los Angeles is at the center of new media, entertainment, gaming, and commerce in a unique way that has been key for Loot Crate as we scaled the business. Culturally, there’s so much creative experimentation and energy in Los Angeles that we have been able to build a really diverse cross-functional team of incredibly talented and creative leaders, which gives us a different brand voice than a traditional e-commerce company.
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