Austin’s Cratejoy Helps Local E-tailers Manage Subscriptions

Eileen Griffith realized that she and her husband were in a rut—and so were her friends.

“Everyone was having the same conversation: What do you want to do?” she recalls. “Everyone was so busy to plan something so it always ends up with take out and Netflix.”

Seeking alternative social excursions, Griffith in September of last year co-founded Fox Society, an Austin, TX-based website that serves as part event planner and personal concierge. Clients pay a monthly subscription fee and have Griffith and co-founder Audrey Dyer take care of the details. “You choose the date on the calendar, but everything else is up to us,” she explains.

Creating the experiences—front row at a drive-in with a gourmet picnic basket or in-home pastry lessons with wine pairings—was the easy part. But managing incoming queries, marketing, shipping, and data analytics with a hodge-podge of blog software got tricky.

“Audrey and I would not consider ourselves technologists,” Griffith says. “We were using 20 different services for a payment processor, outside tech help, something else for messaging. It was hard to keep track.”

In February, the women tried CrateJoy, another Austin startup that sells software platforms specifically tailored to small subscription retailers. Griffith says they signed onto Cratejoy’s platform within two weeks.

Amir Elaguizy, Cratejoy’s CEO and founder, says the startup is “democratizing the technology needed to run a subscription business.”

Nearly 300 other e-retailers have joined Fox Society on Cratejoy’s platform, enabling the startup to raise $4 million in a Series A round from Charles River Ventures in October. The startup will use the money to hire engineers to further develop its software, and to support the recently launched beta version of the site. Previously, Cratejoy raised $2.2 million in seed funding from SV Angel, Y Combinator, Capital Factory, Andreesen Horowitz, Maverick Capital, Start Fund, and ACE Venture Fund.

Cratejoy, too, follows the subscription model, its plans beginning with a 1.25 percent fee on each transaction. For more premium features, Cratejoy charges monthly rates that range from $59 to $299, along with a smaller transaction fee.

The monthly subscription nature of startups like Fox Society require more specialized software than what is used by general online retail, says Elaguizy, who previously started Market Zero, a poker software company that was acquired by Zynga in 2011.

“It’s completely different (for subscription businesses) when you’re dealing with conversion rate, inventory churn, cart abandonments,” he says.

Cratejoy, which had participated in both the Y Combinator program and Capital Factory’s incubator, recently moved into its own office across the street from the Capital Factory in downtown Austin. On a recent visit, the space was crammed with cardboard boxes of various sizes, some with a variety of contents—ties, vitamins, or paleo food shipments—spilling out.

Cratejoy has a subscription for each of its clients. Elaguizy wouldn’t tell me exact numbers, but says he and his wife personally spend “a couple of hundred dollars” a month on e-retail subscriptions of their own, including ones to Griffith’s Fox Society, as well as beauty supply retailer Birchbox and Barkbox, a monthly box of treats for man’s best friend. “I feel it’s important to support each of our businesses,” Elaguizy says.

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