To assist eCommerce merchants with the fulfillment process, ShipBob has notched $40 million in Series C funding. The raise comes on the heels of a $17.5 million in a Series B round in 2017 and $4 million in Series A the year before, according to reports.
The newest round was led by Menlo Ventures. Other investors include Hyde Park Venture Partners, Bain Capital Ventures, Hyde Park Angels and Y Combinator. With the funding round, Shawn Carolan, a partner at Menlo, will become part of the company’s board of directors.
“We love how ShipBob lets smaller, creative merchants affordably offer fast shipping across the country,” Carolan said in a press release announcing the raise. “Customers want what they want, and they want it fast, and it takes serious technology to make it look easy.”
ShipBob was started in 2014 by two engineers, Divey Gulati and Dhruv Saxena. The goal behind the company is not to have merchants pay significant amounts of money for next-day or two-day shipping. The company aims to have them use ground shipping pricing.
To achieve that, ShipBob has six fulfillment centers across the U.S. As a result, the company is able to distribute the inventory closer to the end customer, presumably taking advantage of ground shipping. The fulfillment centers are located on the edges of metropolitan areas such as Chicago, New York and Dallas. These centers are either within cities or just outside. ShipBob’s latest center will be in Cicero, a suburb of Chicago, and will have around 100,000 square feet of space.
Other companies are making similar moves. In fact, buying land on which to build a warehouse is becoming an increasingly pricey proposition. As two-day shipping becomes heavily favored among consumers, eCommerce firms are under mounting pressure to locate their warehouses and distribution centers as close to their customer bases as possible.