By Nancy Dahlberg
South Florida's record-breaking year for venture capital just keeps roaring ahead. And it may have a little something to do with happy dogs.
A North Miami Beach-based direct-to-consumer arts and crafts supplies startup announced it has raised $24 million in Series A funding from growth equity venture firm Volition Capital. Arteza intends to use the funds to continue to expand operations.
Founded in 2015, the formerly bootstrapped Arteza offers affordable arts & crafts supplies via its direct-to-consumer e-commerce model, with 24/7 customer service, and it appears to be working. The company offers more than 750 products and has more than 2 million customers across 100 countries. Arteza heavily leverages social media, and its Creator’s Central blog provides free video tutorials and inspiration for its artistic customer base. The company is profitable, according to a Wall Street Journal report.
If this company is taking a page from South Florida e-commerce success story Chewy, it's no surprise Boston-based Volition Capital was attracted to it. Volition was also an early backer of the pet supplies e-commerce company based in Dania Beach, reportedly investing $15 million, well before its IPO. Will the ties go even deeper? Ryan Cohen, founder and former Chewy CEO, attended the recent investor meeting in Arteza's scrappy office in a North Miami Beach strip shopping center, according to the Journal.
“The arts and crafts supply industry was stale for decades, and our vision was to breathe new life into the market with a fresh approach to products, commerce, and the customer journey,” said Arteza co-founder Mike Koshatko, in a statement announcing the investment. “As a bootstrapped company with a proven business model and eye on further growth, we found a natural partner in Volition Capital. This investment and access to Volition’s expertise and guidance will keep us well-positioned as the leading D2C art supplies brand.”
As part of the transaction, Volition Capital’s Managing Partner Larry Cheng and Dave Gordon, a principal, have joined Arteza’s board of directors.
In places like Florida, investors are more likely to come across "more grounded businesses that are frankly driven by meeting customer needs rather than raising money," Cheng said in the the Wall Street Journal. Volition has invested in at least two other South Florida companies, Cortera and Verid.
Arteza was founded by Koshatko, originally from Ukraine, and Jurgis Plikaitis, from Lithuania. According to the Journal article, it expects to generate 2019 revenue in the double-digit millions – more than double last year’s revenue.
With the funding, Arteza plans to double the product line, Koshatko said. The company employs 40 in South Florida and about 100 in Belarus.
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