COVID has changed online shopping forever as consumer preferences have shifted and the convenience of quick delivery without leaving home has surpassed the in-store experience altogether. Retailers have been forced to re-evaluate the framework of their offerings and deepen their relationships with customers through digital offerings. Clyde is a provider of extended warranties that integrates directly with the checkout processes of e-commerce merchants, giving consumers a seamless and convenient way to protect their purchases while retailers are able to add incremental revenue to their online sales. Clyde works with all the major e-commerce platforms through plug-and-play integration and also offers a flexible API option for custom integrations. On the backend, merchants can monitor the entire warranty program including performance, claim status, and customer information while Clyde handles the entire claims experience. Merchants using the platform are able to increase the warranty purchase rate to 18% from the industry average of 4%.
AlleyWatch caught up with CEO and Founder Brandon Gell to learn more about the AHA moment that led to the formation of Clyde, the importance of building customer loyalty in the digital commerce era, the company’s strategic plans, latest funding round, which brings the total equity funding raised to $42.3M, and much, much more…
AlleyWatch caught up with Clyde Founder and CEO Brandon Gell
Who were your investors and how much did you raise?
We raised $41M, including $25M in Series B funding and $16M in working capital. The funding round was led by Headline, with participation from Vulcan, Spark Capital, Crosslink and other leading investors.
Tell us about the product or service that Clyde offers.
In 2017, there was a problem in the warranty space — it was inaccessible: impossible to understand. And slow. So slow. Clyde reimagined what it meant to launch, manage and find success with a product warranty program. Today, we help our partners launch omnichannel product lifecycle experiences, funded by the highest-performing warranty programs this space has seen.
Clyde is a product lifecycle platform that helps merchants maximize the longevity of their customer relationships, and enables customers to unlock the full value of the products they buy. Our core offering is an extended warranty product that allows merchants to easily sell protection plans, drive revenue and deliver unbeatable customer experiences. The platform also includes a unified claims management tool for merchants to handle all customer and product issues, regardless of whether or not they own a protection plan. With the funding, we will expand our GDPR and CCPA-compliant platform so merchants can identify and build direct relations with customers, even when they purchase through third parties.
What inspired the start of Clyde?
In 2017, I worked for a small tech startup in Ohio building a 3D scanner and was charged with building an in-house product warranty program for the brand. After six months of reaching out to underwriters and administrators, I wasn’t making any inroads. Around the same time, I also purchased an extended warranty for a product and then regrettably threw away the receipt before I registered the product. It was then that I realized the extended warranty process was broken for both merchants and consumers.
How is Clyde different?
Clyde is more than just a warranty platform. We’re focusing on the complete product lifecycle, where merchants can gain an omnichannel, holistic understanding of their products and customers alike while driving higher attachment rates and more revenue.
What market does Clyde target and how big is it?
Disrupting the $50B+ per year extended warranty market, Clyde works with brands and retailers across a number of verticals, including consumer and household electronics, scooters and e-bikes, furniture and mattresses, appliances and hardware, fitness and sporting equipment, and jewelry and watch brands.
What’s your business model?
Clyde’s business model is completely aligned with our merchants’. Clyde only makes money when our partners make money — we charge per contract sold to a consumer through a merchant partner. When a protection plan is sold, merchants collect the full sale price of the warranty, keep 100% of their margin, and remit the premium and administrative fee back to Clyde.
What are your post-COVID office plans?
We’re very fortunate that we were able to grow the team significantly over the past year and a half. While we now have team members distributed across the country, we are moving into a larger office space in New York, our headquarters, in November 2021.
What was the funding process like?
Our Series A round in 2020 was led by Spark Capital. Since then, we have made significant strides in product as the market matured over the last two years. During that time, Headline saw our vision in this market space, which led them to partner with us and invest in our team and product, leading this Series B funding round.
What are the biggest challenges that you faced while raising capital?
The warranty space is a highly competitive market with major potential. Clyde outperforms incumbents and competitors in nearly every metric with regard to how our warranty programs perform. That said, we’re executing on a much larger vision — one that doesn’t have any comparisons in the market today, so clearly wrapping our investors’ heads around the opportunity size and the GTM strategy took investment. Being product-first from day one gave our investors the confidence in our ability to thoughtfully build products that our partners need and want.
The warranty space is a highly competitive market with major potential. Clyde outperforms incumbents and competitors in nearly every metric with regard to how our warranty programs perform. That said, we’re executing on a much larger vision — one that doesn’t have any comparisons in the market today, so clearly wrapping our investors’ heads around the opportunity size and the GTM strategy took investment. Being product-first from day one gave our investors the confidence in our ability to thoughtfully build products that our partners need and want.
What factors about your business led your investors to write the check?
The $41M funding round was led by Headline, which recognized our forethought and vision in solving a major pain point for both merchants and consumers. Our platform fills an inherent gap in the product lifecycle, where the purchase of a product and the post-purchase experience of that product are disconnected. Our team has built a complete product that addresses this void, and Headline saw that.
What are the milestones you plan to achieve in the next six months?
In Q1, Clyde will announce the platform that we currently have in-market today. In the next six months, we’ll continue to invest in and expand the platform, providing merchants with a better understanding of their products and customers, while driving higher attachment rates and more revenue. Additionally, we’ll leverage the funding to fuel our expansion into new markets and categories, beginning with hiring new talent and expanding our international footprint.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Have clear goals of what you absolutely need to execute on and focus only on that. Everything else is a distraction.
Where do you see the company going now over the near term?
When we launched our extended warranty solution, it was always our intent to use that as a foundation for our complete product lifecycle platform. The funding will enable us to execute on this vision. We’ve already proven we have the tools to do this. Over the next year, we will continue to build on this success as we reshape what it means for merchants to engage with consumers throughout a product’s lifecycle.
What’s your favorite outdoor dining restaurant in NYC?
Cosme!
