Paddle8 Raises $34 Million in Series C Funding
The round also saw participation from existing investors including Mousse Partners, a luxury investment firm whose previous investments include Warby Parker, Paperless Post, and Bonobos; and art-world insiders including artist Damien Hirst; Jay Jopling, the founder of White Cube Gallery; and Stavros Niarchos, a collector and entrepreneur.
With an existing community of over 500,000 collectors from more than 90 countries, Paddle8 will use the injection of capital to expand its global presence both in the U.S. and Europe and to hire top talent across all major areas of the business. Particular focus will be placed on growing its engineering team, as well as bringing in category specialists from areas such as vintage accessories and design.
Additionally, Paddle8 will use this influx of cash to continue to make mobile bidding and selling even easier by investing in their app and mobile capabilities, helping to better serve their global nomad and millennial users. With a 37% increase in mobile traffic, and 10% increase in mobile bids in just the past three months, mobile will continue to be a major focus throughout 2015.
"We are truly interested in how Paddle8 uses technology to bring innovation in the art world -- which has historically been resistant to change -- through smart digital platforms. Paddle8 is a solid brand that has already established itself as a trusted source within the art community. I am impressed by its founders' creativity and analytical abilities and they certainly know their business. We look forward to partnering with them and playing a role in their continued growth and success," said David Zwirner.
Overall, Paddle8 has been experiencing a period of rapid growth, broadening the scope of the business beyond the buying and selling of fine art to incorporate auctions of design and furniture in 2014 and, more recently, vintage men's and women's accessories, music and film memorabilia, art toys and other collectibles. Total revenues in 2014 totaled $35.8 million -- a 146% increase from 2013 and ahead of any competitor in the space -- with total revenue in the first half of 2015 reaching $25M. Additionally, Paddle8 has experienced a year-over-year growth of 17% in the average sales price in for-profit auctions.
"This is a crucial time for the art and luxury markets. With collectible luxury goods rapidly attracting a larger global audience, and more people viewing high-end collectibles as a meaningful investment, the demand is only set to increase," says Edgar Berger, who has previously invested individually in tech companies including Palantir, Pillow and washio. "It's clear that Paddle8 is positioned to take a large share of the market as it's both mobile and easily accessible -- perfectly aligned with the behavior and demands of today's buyer. I see a tremendous opportunity to build on Paddle8's current success, and am excited to be aligned with a company that encourages even more people to enter the world of collecting."
"Paddle8 was founded to fill an existing gap in the market for an accessible, trusted and well-designed online marketplace for collectors to buy and sell art and high-end luxury collectibles. For us, it wasn't only about making the buying and selling process easier, it was about democratizing art and innovating in an industry that seemed resistant to change," said Osman Khan, co-founder of Paddle8. "With this investment, we'll be able to not only make the Paddle8 experience even more seamless, but also bring access to art and luxury collectibles to more people both within the U.S. and around the globe."