Flooz.com announced Monday that it is the recipient of $16.5 million (US$) in first-round capital financing from a group of well-known Internet venture capital firms. Flooz has been described as the first service to provide online gift-giving currency.
The New York-based company, which provides coupons for more than 200,000 e-commerce products, said that the money will be used to expand its marketing activities in order to reach more consumers.
The company also said it that it will accelerate the development of its navigation and search capabilities, as well as its personalized tools for buying and receiving its coupon.
The venture capital companies backing Flooz.com are some of the more notable in the industry. The lead investor was Oak Investment Partners. Oak was joined by Brentwood Venture Capital, Maveron Equity Partners and Venture Strategy Partners LP. Former Lotus CEO Jim Manzi also invested and is a member of the company’s board of directors.
“We are fortunate to be backed by the nation’s top Internet venture capitalists,” said Flooz.com co-founder and CEO Robert Levitan. “Their support is an endorsement of our strategy to enhance the experience of online gift-giving and shopping and gives us tremendous depth and resources to add new merchants that will accept ‘Flooz’ as payment.”
Give and You Shall Receive
Flooz backers clearly believe that the product is unique — a shrinking commodity on the Internet landscape. The premise is simple: Sign up merchants who will accept ‘Flooz’ as payment and then market the site to those who view gift-giving over the Internet as the salvation of mall-weary civilization.
Users of the site can e-mail a gift of ‘Flooz’ for any amount along with a personalized card to a recipient, who then can browse online and choose from the site’s participating merchants and select a product.
So far, merchants such as Tower Records, Teva, Chipshot.com, Fogdog Sports, Books.com, Art.com and MotherNature.com have signed on as merchants.
More Relationships to Come
Flooz’ business relationships should help cement more deals in the future. Oak Investment’s portfolio includes Compaq, Garden.com, Inktomi and Office Depot. Brentwood Venture Capital has invested in Apple, Stamps.com, NextCard and WebTV, among others.
Levitan was the co-founder of iVillage.com, the women’s network. He has created online strategy for Charles Schwab, Johnson & Johnson, MGM and others.