The global baby stroller market is estimated to be $3B per year; the high chair market is estimated to be in the millions each year. Yet, when you think of these products, you don’t think about a particular brand. Lalo is a direct-to-consumer modern baby and toddler brand focused on offering design-oriented premium products. The company offers an innovative, versatile, and growing line of baby products that include strollers, high chairs, play tables, bibs, and tableware. Unlike others in the space, Lalo focuses on building direct relationships with customers, allowing them to use this data to serve the needs of parents as their families grow and evolve. Although the pandemic limited traveled and affected the demand for strollers, the startup, founded in 2019, was able to increase revenue by 320% in 2020.
AlleyWatch caught up with CEO and Cofounder Greg Davidson to learn more about the inspiration for the business, the company’s strategic plans, latest round of funding, and much, much more.
Who were your investors and how much did you raise?
Our seed round closed at $5.6 million and was led by Amanda Schutzbank and Deborah Benton of Willow Growth Partners. Additional investors included businesswoman and philanthropist Yael Cohen Braun, Dave Health, CEO of Bambas, Super Angel Fund, and business consultant and former senior partner of Boston Consulting Group, Michael Silverstein.
Tell us about the product or service that Lalo offers.
Lalo makes beautiful, functional, and safe products for babies and toddlers. Our products range from The Chair, our best-selling 2-in-1 high chair/play chair combo, play tables and kits, and tableware.
What inspired the start of Lalo?
I was catching up with Michael at dinner almost three years ago and mentioned how my friends that were starting families were struggling with what baby products to buy. We started surveying parents and quickly realized that most could call out specific baby products they liked, but not brands. From there we knew there was a huge opportunity to create a generational brand in this space.
We set out to change the way families shop with thoughtfully designed products, intuitive e-commerce, and a parent-first approach. As a digitally native brand, we’ve implemented a strong connection with consumers into the brand’s core, which is evident in the < 2 percent return rate across our products.
What market does Lalo target and how big is it?
Lalo makes premium baby products. The baby goods market has been growing steadily and with the shift to e-commerce, Lalo is poised to continue gaining market share as customers turn to brands that can serve them online.
What’s your business model?
We’re building a strong omnichannel business with a strong direct-to-consumer foundation.
How has COVID-19 impacted the business?
The pandemic was an accelerant for our business. With parents still needing our products to keep their little ones safe and developing, they turned to us because we could serve their needs online. We saw a 320 percent revenue increase in 2020 and grew our customer base by 360 percent despite the pandemic
What was the funding process like?
Fundraising for each round is its own unique experience, but doing it during the pandemic added an additional layer of complexity. In fact, we never met our lead investor until after the deal closed. For us finding the right investor was key, so our internal diligence process took a bit longer. Ultimately, we landed on the best lead in Willow Growth!
What are the biggest challenges that you faced while raising capital?
We started conversations in Q4 2020, and at that point, there was still a lot of uncertainty around e-commerce, supply chain as we were still living through the pandemic. Ultimately Lalo’s vision of re-inventing the shopping experience for parents looks beyond the pandemic and getting investors out of the short-term mindset and thinking as big as we were.
What factors about your business led your investors to write the check?
We created Lalo ultimately not to just deliver outstanding products but to ultimately reinvent the shopping experience in the category by building a generational brand that can connect with parents across milestones that both the parent and children go through together. This vision to change the category for the better and the ability to stay in our customers’ lives outside of one product was what gave our investors the confidence to invest in Lalo.
What are the milestones you plan to achieve in the next six months?
We have several exciting new launches in the pipeline and are excited to continue growing our base and have our products in the homes of many more families.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Have a mentality that it is more important to survive than thrive. By doing so you will become more creative and also more in-tune with the day-to-day operations of your business. Keeping the lights on is the most important factor of progressing and if you are not moving forward the opportunity for that new capital will never surface.
Where do you see the company going now over the near term?
You can expect Lalo to continue moving deeper into products in your home, while creating new supporting products for our current hero SKU’s.
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