Fabric raises $140M led by SoftBank for its headless eCommerce platform; now valued at $1.5 billion
Seattle, Washington-based e-commerce tech startup Fabric announced today has closed a $140 million Series C funding led by Japan’s Softbank, with participation from Forerunner Ventures, Glynn Capital, and existing investors Redpoint Ventures, Norwest Ventures, and Stripes.
Fabric said it will use the cash infusion to ramp up product development and expand into more markets. The announcement comes less than a year after the company raised $100 million in a Series B round led by private-equity firm Stripes in 2021. The latest round brings Fabric’s valuation to $1.5 billion, making the startup a member of the highly-coveted unicorn club.
In conjunction with the funding, Fabric also announced that Robert Kaplan from Softbank will join its Board of Directors. In 2021, fabric achieved 4.5x YoY revenue growth as the company cashed in on the pandemic-fueled surge in demand for online shopping.
Founded in 2017 by CEO Faisal Masud, the Seattle, Washington-based Fabric offers a “headless” commerce platform as a service to retailers, merchandisers, and sellers to streamline their e-commerce operations. Fabric’s software helps these companies customize their websites and offers back-end technology for online payment transactions. Fabric’s customers include apparel retailer Chico’s FAS Inc (CHS.N), fast-food giant McDonald’s Corp (MCD.N), and Jessica Alba’s The Honest Company Inc.
The term “headless” gets its name from the idea of chopping the “head” (the front end, i.e. the website) off the “body” (the back end, i.e. the content repository). Headless e-commerce separates the front- and back-ends of e-commerce websites and applications, which allow brands greater flexibility and faster page-loads.
“We truly appreciate the vote of confidence that Softbank and our other world-class investors have in our vision, our execution and our experienced team,” said Faisal Masud, CEO of fabric. “This round will allow us to increase the velocity of our innovation and product development while we continue to create technology that, unlike our competitors, bends to the needs of our customers, not the other way around. Fabric truly is the future of digital commerce and our new customers Chico’s, McDonald’s, TriMark, L’azurde, and most recently The Honest Company, are embracing it.”
As economies around the world begin to put the pandemic behind them, brands and retailers are shifting focus to creating exceptional customer experiences and are ditching monolithic, restrictive, and inflexible systems for modern, composable, API-driven technology.
“Retailers need to meet modern consumers wherever they are – whether online, offline, mobile, social, or any future entry point. This means merchants of all sizes, and especially mid-market and enterprise, need the right commerce platform to keep pace with evolving trends,” said Robert Kaplan, Investment Director at SoftBank Investment Advisers. “We believe that fabric has built the industry’s best API-first modular commerce platform and accompanying commerce applications to give merchants unrivaled power and flexibility, all in a manner that reduces the pain of migrating over from legacy, outdated commerce platforms.”