Milwaukee-based wine subscription startup Bright Cellars has raised an $8.5 million series A round of funding from investors. It closed on Feb. 22.
[caption id="attachment_375965" align="alignright" width="450"] Richard Yau and Joseph Laurendi, co-founders of Bright Cellars.[/caption]
The startup surveys subscribers on their palate and preferences, and uses its algorithm to match them to wines and cheeses they are likely to enjoy. Customers receive a monthly shipment of products. As of 2018, Bright Cellars had 22,000 subscribers and growing, but the company declined to disclose current subscriber numbers.
Washington, D.C.-based Revolution Ventures led the equity round, and Milwaukee’s Chris Abele-led CSA Partners again invested in Bright Cellars. The startup has previously raised a total of $5.2 million from investors.
Bright Cellars was co-founded in 2014 by Richard Yau and Joseph Laurendi in Boston, and moved to Milwaukee in 2015 to take part in the gener8tor startup accelerator. The MIT grads decided to stay, and Bright Cellars has since grown to 40 employees and increased revenue by 1,500 percent. It is based out of a 5,500-square-foot office in the Ward4 startup community in the Historic Pritzlaff Building at 333 N. Plankinton Ave. CSA Partners established Ward4. Yau said the company can add another 20 to 25 employees in its existing space.
“It’s been actually a really good arrangement because if we need a larger meeting room, presentation space, whatever it is, everyone’s a Ward4 member, as well,” he said. “I think it’s going to be good for us for the foreseeable future.”
Bright Cellars plans to use the funding to better harness the feedback it gets from customers and improve upon its matching algorithm, Yau said. And he plans to hire 10 new employees over the next six months.
“With our growth, we’re really building our operations, so that’s to handle a higher package volume,” he said. “We’re building our data science capabilities, so we really want to use the data we’re collecting to continue to improve matching, to improve our member experience, to do a better job.”
Yau said the business has been focused on operations to this point, and now will work to perfect its systems.
[caption id="attachment_375966" align="alignleft" width="395"] A Bright Cellars subscription box.[/caption]
“We’re at a stage where we’ve validated the business model. We’re at a point where we understand that our member base is interested in the service and that we’ve been able to grow and now we want to really build the experience,” he said.
It is relatively rare for a Milwaukee startup to surpass the series A hurdle. Yau said Bright Cellars has been able to do so because it has secured local investors.
“I think that we’ve gotten much more support from the community than we could have hoped for or expected,” he said. “That’s really why we stayed was CSA Partners and gener8tor.”
But he’s also excited to have attracted a coastal investor with national scale as Bright Cellars grows.
“We’ve gotten to that stage where we were able to build it up to this level and I think they’re going to be able to help us get to even more scale,” Yau said.
“Wine is a massive market that has yet to be disrupted by data and technology,” said Clara Sieg, partner at Revolution Ventures, in a statement. “Bright Cellars' unique ability to integrate online and offline experiences in the consumer category gives Richard and his team data insights that will fundamentally change the way consumers shop and experience wine.”
“Bright Cellars is a great example of how a startup can grow and thrive in Milwaukee,” Abele said in a statement.