Anyone who has moved apartments in New York knows how difficult it can be to move with furniture. Many New Yorkers opt to just sell and purchase furniture – creating an endless cycle of spending and environmental waste. Kaiyo is an online marketplace for buying and selling pre-owned furniture. While there are a number of options for pre-owned furniture (Craigslist, Facebook marketplace, et al), Kaiyo is the only one that handles the most tedious part of the process – the logistics of the sale. The startup, founded in 2014, picks up the item, cleans, photographs, and even delivers it to the buyer, storing the items in its own warehouse until the sale, eliminating this massive pain point for consumers.
AlleyWatch caught up with CEO and Founder Alpay Koralturk to learn more about how his seventh move in New York inspired the company, how the Series A came to fruition from interest from a satisfied user that happened to be a venture capitalist, the company’s strategic plans, latest funding round, which brings the total funding raised to $7.1M, and much, much more.
Who were your investors and how much did you raise?
Tell us about the product or service that Kaiyo offers.
Kaiyo is an online furniture marketplace dedicated to great design, exceptional customer care, and a more sustainable planet. Kaiyo makes buying and selling furniture simple and sustainable by providing deep discounts on top brands to its buyers and by handling the moving, pickup, photography, cleaning, and delivery for its sellers. Kaiyo currently serves and provides white-glove delivery to the New York metropolitan area which includes New York, New Jersey, and Connecticut, as well as the Philadelphia metropolitan area. We also offer nationwide delivery through relationships with trusted third-party carriers.
What inspired the start of Kaiyo?
I got married in 2014 and my wife and I had to furnish a new apartment. This was my seventh move in NYC, so I was very familiar with the hassle of buying and selling furniture. Both my wife and I are passionate about sustainability and tried buying secondhand to furnish the apartment. It was such a frustrating experience that I thought there needed to be an easier way—something that was convenient for the customer but ultimately better for the planet.
There are other online furniture marketplaces such as Craigslist, Facebook Marketplace, AptDeco, and Chairish; however, they are not full-service in the same sense that Kaiyo is. We handle pick-up for customers free of charge, and then our in-house teams professionally clean, photograph, and store items until they are sold, plus we deliver each item to its new buyer. Keeping items in our own warehouse allows us to deliver in as fast as two days to customers in our primary coverage area and ensure a more positive customer experience end-to-end.
What market does Kaiyo target and how big is it?
Kaiyo’s biggest target market is Millennials. Many of our customers are looking to save money, and we provide them access to designs and brands that they may not otherwise be able to afford at full price. This encourages them to move away from cheaper, less sustainable, single-serve furniture brands.
What’s your business model?
Kaiyo takes a commission from the sales made on our marketplace and shares a part of the revenue back with the original sellers based on the final selling price of their item. This allows us to keep our offering free to sellers.
How has COVID-19 impacted the business?
COVID-19 has been a challenge for everyone and we were very early in adopting contactless processes alongside sanitation and sick leave policies with the safety of our customers and our teams in mind.
More consumers have been moving during COVID-19 and many experienced long furniture delivery delays. We offer the opportunity to shop and receive pieces from brands they trust in as fast as two days, giving them one less thing to worry about during a stressful time.
What was the funding process like?
While the company was not looking to fundraise, Kaiyo was approached by Moderne Ventures after Partner, Liza Benson, utilized Kaiyo’s platform and was impressed with the convenience and service. One conversation led to another and we ended up raising our Series A with them.
What are the biggest challenges that you faced while raising capital?
We can’t quite name any challenges since the round happened via inbound interest.
What factors about your business led your investors to write the check?
Modern Ventures specializes in innovating within the multi-trillion-dollar industries of real estate, finance, insurance, hospitality, and home services. All of their LPs are native to these industries and they only invest in companies where they can create synergies with their investors.
Having experienced the ease and convenience of our services firsthand, they understood how Kaiyo fulfills many unmet needs for those who are moving and do not want to see good pieces go to waste, or those who are looking to furnish in a way that is both sustainable and straightforward. This solves some key pain points for companies in the real estate and multi-family home operator sectors.
What are the milestones you plan to achieve in the next six months?
Expansion into additional markets, such as Washington D.C. starting June 1, and strategic partnerships through Moderne Ventures in the multi-family, residential and commercial markets.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Focus on strengthening your cash flow and bottom line. Ultimately, cash is king and it’s easier to raise money when you don’t need it.
Where do you see the company going now over the near term?
We’re totally focused on scaling our service and expanding to new markets in the near term.
What’s your favorite outdoor dining restaurant in NYC?
Casa Enrique in Long Island City, which is where I used to live. They have great food and a Michelin star, but also come at a significantly better price point than other restaurants of that caliber in New York City. Their outdoor dining has been expanded since the introduction of NYC’s Open Streets program.