Today Montreal-based ecommerce startup Frank & Oak announced it has raised $5 million in Series A funding from Lightbank, the VC firm started by Groupon’s founders Eric Lefkosky and Brad Keywell, with participation from BDMI and Rho Ventures. The company launched in February 2012 to design, manufacture and deliver custom men’s clothing and accessories at a price point that’s typically under $50.
Frank & Oak evolved out of now-defunct men’s clothing startup Modasuite, which launched in 2010 was backed by Real Ventures and other investors (Real Ventures has provided a follow-on investment as part of today’s funding round). That company aimed to provide bespoke men’s clothing online, similar to companies like Indochino, and co-founder Ethan Song said that they decided to change focus after realizing that the bigger opportunity was in creating an online style magazine for men paired with a custom line of clothing and accessories.
“Everything that Frank & Oak is about is making a great lifestyle accessible to as many men as possible, so that’s when we decided to pivot our business model and work on a product that we felt was more accessible, more editorially-focused, more interesting, and could really create that delight month after month with our users,” Song said in an interview.
Unlike subscription ecommerce startups like BeachMint, users don’t have to sign up for a monthly subscription, rather Frank & Oak releases a new collection of items every month, and users can buy as much or as little as they want. Aimed at men ages 20-35, the site features clothing and accessories, starting with shirts but since branching out to ties, pants, and other items. It also offers editorial to accompany the items for sale, showcasing top picks from the site, videos and Q&A. Members can also join the Hunt Club, which gets them free shipping, 10 percent credit back on each purchase, and at-home try-on (Song said 15 percent of Frank & Oak members are part of the Hunt Club).
Song said they decided to own the entire supply chain rather than curating items from other designers to keep the price point low, and to have more control over everything from fabric to fit. “There’s a huge trend towards vertical integration, both online and offline,” he said. “We offer really accessible menswear at a great quality, you can’t do that if you’re selling other people’s products.”
The funding will be used for hiring (the company is now 20 people, up from seven at launch), and for expanding into new product categories. Song said the funding confirms their momentum, and though they’re not releasing any user or revenue numbers, they report the site has experience double-digit growth month-over-month since launch.
With no shortage of ecommerce and brick-and-mortar retailers for men to shop at both in person and online, not to mention bespoke clothing sites and boutiques, Frank & Oak is far from the only moderately-priced online men’s retailer. Song says retailers like Gap and Banana Republic are their biggest competitors, though they’re trying to differentiate by providing editorial and a personalized experience.
Song said they’ll be focusing on expanding the product line over the next few months, and they’ll also be releasing a mobile app. Right now they only ship to the U.S. and Canada, though Song said they’ve had demand from Europe so are definitely looking to expand down the line. While the price point is typically around $50, Song said they won’t necessarily stick to that number, as long as the value fits the price tag.
The company told the Montreal Gazette in September that they expect to end the year with $6 million in revenue, and if they can expand their product offerings while also eventually going international, they could be a go-to destination for men who want stylish clothes at a reasonable price point without having to brave the malls or buy from big retail chains.