UrbanStems Announces $1.5 Million in Funding

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On-demand flower delivery start-up in Washington, D.C. and New York City closed on a seed round led by Middleland Capital, Sagamore Ventures and NextGen Angels.

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We are excited by the opportunity to continue spreading happiness throughout DC and New York with our premium-yet-affordable floral arrangements, delivered at a moment’s notice.

UrbanStems, the start-up delivering hand-crafted bouquets on demand in Manhattan and Washington, D.C. and looking to disrupt the oft-maligned online floral industry, announced today that it has completed a $1.5 million round of seed funding, including investments from Middleland Capital, Sagamore Ventures, NextGen Angels and Great Oaks Venture Capital.

Since its launch in Washington, D.C. in February 2014, UrbanStems has elevated the process of sending same day flowers online and expanded to New York City in December 2014. Users order online in a few clicks - and starting this week through an iOS app - from a selection of exclusive seasonal bouquets, priced from $35 with free delivery and no fees. The long-lasting bouquets are delivered by bike couriers within an hour or at any specified time.

UrbanStems distinguishes itself from established players and other startups in the floral delivery space through its innovative vertically-integrated supply chain originating from eco-certified farms in South America, enabling it to provide an unparalleled customer experience. Flowers are cut off the stem and arrive in company owned delivery hubs in less than 48 hours, allowing for consistent quality and unparalleled freshness, in addition to cutting out some of the most significant costs associated with traditional flower delivery.

“Ordering flowers hasn't really changed in the last couple of decades besides a crude addition of phone and web to the traditional neighborhood florist”, said Middleland Capital’s Alex Pessala, who will be joining UrbanStems’ board. “This industry is in dire need of an ecommerce brand that can scale quickly and efficiently, while providing a much needed improvement to customer experience.”

The company, which has nine full-time employees, was founded by former college roommates Ajay Kori and Jeff Sheely after both were fed up with underwhelming product quality and frustrating customer service when trying to send flowers via traditional online flower options.

“The urban consumer market is experiencing a tremendous amount of disruption. Higher quality for a lower price, and on-demand service is becoming the standard, not the exception,” said Sagamore Ventures Managing Partner, Demian Costa. “UrbanStems was particularly interesting for us, given our roots in the flower delivery business.” Sagamore Ventures is the investment arm of Under Armour Founder and CEO, Kevin Plank. As a University of Maryland undergraduate, Plank ran a flower delivery business on Valentine’s Day each year that earned him $17,000 - which eventually became the seed money for Baltimore-based Under Armour.

“As proud members of the Washington-Baltimore tech community, we look forward to doing our part to help our region continue to grow into a nationally-recognized hub for innovation,” said co-founder Ajay Kori.

With this funding, UrbanStems will continue its expansion into additional cities in 2015 and invest in marketing and key new hires. In the year since UrbanStems launched, it has enjoyed exceptional growth, increasing its sales by double digits month over month.

“We are excited by the opportunity to continue spreading happiness throughout DC and New York with our premium-yet-affordable floral arrangements, delivered at a moment’s notice,” said co-founder Jeff Sheely.

About UrbanStems
UrbanStems is a DC-based technology company that believes sending flowers should be easy and affordable. They offer long-lasting bouquets sourced from eco-friendly farms in South America, delivered within an hour from their website or forthcoming iOS app. Delivery is confirmed with a picture of each bouquet in front of the recipient’s building, and bouquets start at just $35, with free delivery and no fees - less than half the cost of a typical floral delivery. Since launching less than a year ago in Washington, DC, UrbanStems has seen explosive growth, increasing its sales by double digits month over month.

About Middleland Capital
Middleland Capital is a global private investment firm focused on early-stage technology opportunities. Leveraging a unique breadth of geographic and industry experience, the firm seeks long-term partnerships with exceptional management teams to commercialize innovative technologies, accelerate growth and build long-term value around the world.

About NextGen Angels
Founded in Washington, D.C. NextGen Angels is a community of young and influential angels who invest in exceptional entrepreneurs in D.C. and in New York City. The group works together on behalf of their portfolio companies to help them build the next great companies of the future.

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Jeff Sheely
UrbanStems
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