location based blog: 6-Month-Old Startup Lot18 Closes $10 Million Series B Round

Monday, May 2, 2011

6-Month-Old Startup Lot18 Closes $10 Million Series B Round

philip james lot18

Last week we told you New York-based startup Lot18 was already doing $1 million+ in sales.

Investors seem to be impressed with that figure, because the wine flash sales site just raised a $10 million Series B round.

It took two months to round up the cash; investors include NEA Ventures and FirstMark Capital, which led the Series A round.

"When we launched in mid-November, we originally said that we would start raising the B round when we had our first million-dollar month," cofounder Kevin Fortuna tells us. "We thought that would be later this year."

"The revenue numbers blew past expectations from the day we launched [on November 10]. November was a half month and we did $80,000 in sales. Based on the February numbers we saw, we knew March would be a million-dollar month, and April was way bigger than that."

Fortuna says Lot18 will use the money to grow its 60-person staff. It's hiring 35+ positions and is mostly looking for engineers and designers. To accommodate everyone, Lot18 will put money toward a larger office.

Another portion of the money will be dedicated to developing an excellent experience for both customers and wine partners. It will also be spent launching other sales categories.

"We’re going to be investing in other merchandising opportunities for wine, but wine will stay our main focus," Fortuna tells us. He mentions wine accessories and liquor sales are likely in the near future. The travel category is another thought.

Fortuna says he expects Lot18 to be profitable one year from now. Then again, at the rate Lot18 is growing (50,000+ new users per month), profitability could come much sooner than that.

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