Fig and Bloom has been quick to launch, but will the delivery factor inhibit its potential to scale?

In October of last year, Santa Monica-based floral delivery startup BloomNation, founded in 2011 by David Daneshgar, Gregg Weisstein and Farbod Shoraka closed a $5.5 million funding round after years of bootstrapping the company. That round included well-known investors such as Andreessen Horowitz, Spark Capital, Chicago Ventures, Mucker Capital, and CrunchFund. At the time, I felt there was yet to be a platform in Australia that replicates exactly what BloomNation is doing. Other than Fast Flowers, which was founded by Jonathan Barouch (now founder of LocalMeasure) in 2005 and sold to 1300 Flowers (FlowersCorp) in 2010, there isn’t a platform that has gained any significant traction or reputation for being a platform for all florists. In fact, our most successful and well known online floral companies are Roses Only (acquired by FlowersCorp last January) and Granda Flora – both of whom have developed their own brand and design style that is perhaps not suited to mass production across thousands of floristry stores. There stills exists however a lot of room to integrate technology and the floral industry together across multiple verticals. There have been some attempts to create tech startups with a floral focus over the last couple of years. Perhaps one of the most notable was in 2013 when student entrepreneur Kate Klavins (Adelaide) launched her new venture Floragram which allowed people across Adelaide to purchase a surprise bouquet for $25, including delivery. That startup was launched as a part of the Flinders University Venture Dorm program in Adelaide. Even though Klavins was able to validate her idea through paying customers, eventually Floragram made its last delivery in September of 2014. The premise was right, the product was good - but I would argue that the financial model was where the startup ran into trouble as there was nothing in place on the platform that forced stickiness with customers. Three weeks ago, another new player entered the space and has chosen to avoid both: (a) dealing with florists; and (b) a business model that hopes for repeat orders. Melbourne founded Fig and Bloom is a new floral subscription service that allows customers to have flowers delivered to the home or office on a weekly basis by signing up to a number of different plans including a non-contractual month-to-month plan at $25.00 per week and an up-to-six-month contract period at a discounted rate of $19.00 per week. The idea came about when founders Kellie Brown and Dan Groch were talking about different business models that could work in the subscription space a little over a month ago. Realising that she and many of her friends always bought fresh flowers for their homes and offices each week, Brown suggested that it would be a great idea to automate the process. Turnaround from idea to the service going live was within a couple of weeks and the startup now has a steadily growing base of paying customers within Melbourne's metropolitan area - this is currently the only location the startup is fully operational. Having said that, the plan is to expand nationally over the coming months as the customer base in Melbourne strengthens. What is setting the service apart from companies like Roses Only is the point of difference when it comes to product. "We just wanted to make bouquets that had a point of difference," said Brown. "We want to do different stuff. The things that have been doing really well for us are products like ornamental pineapples and unusual flowers. Competitors like roses only do what they do well, so we like that we offer something quirky that they are not offering." I don't know if I necessarily agree that Roses Only is a competitor per se. I see what they do more on the 'gift' side of the market, whereas Fig and Bloom operate more in the everyday 'lifestyle' space. Part of Fig and Bloom's scalability strategy is keeping their range simple - this means a particular set of flowers that are changed through the seasons. Brown has utilised her fashion background to build upon connections that she already had with growers, buying and sourcing directly from them, and says that as they grow, it will be important to have localised relationships in each territory the business is set up in. For fresh cut flowers, a central distribution centre would not work as well, especially with the land mass that needs to be covered in getting products around Australia. Right now, Brown and Groch are taking care of the deliveries themselves. However Brown told Startup Daily that this process will be outsourced as the company reaches that point of scalability. It is at this point, in my opinion, that Fig and Bloom will either choke or flourish. There are a number of delivery strategies that could be implemented from outsourcing to a traditional courier model to even piggy backing of existing infrastructure that startups like Bluechilli's Liquorrun or recently launched DriveYello already have in place. While fundraising would certainly make figuring out the challenges of this process easier, Brown says that she is not entirely sure yet whether they will go down that path, although makes a point to mention that Fig and Bloom is definitely open to having those conversations. It is worth noting that both Brown and Groch have startup experience under their belts. Groch is part of the team that launched performance management tech platform Doceo and through that has taken on investors in that business. And Brown still has a venture in the background she claims has a pre-launch valuation of $1 million but is not speaking about publicly at this stage. Startup Daily can confirm that it is in the fashion industry, however not necessarily technology based and investors are part of that conversation. Allegedly 'red tape' has been inhibiting the business from moving to the next phase. At this point in time, Brown says her focus in on growing Fig and Bloom. The venture is seeing high growth and conversions via social media channels such as Instagram; and Brown says that social media has been a pivotal part of the entire journey thus far, mentioning that she and Groch are also partners in life after meeting on mobile dating application Tinder.