Seasoned startup founders Andrew Jacobs, Joe-Bramwell-Smith and Mikkel Bergmann have announced the launch of their new disruptive Aussie retail-tech business Kitfit.
Already attracting attention on a global scale, Kitfit is a global solution for millions of consumers and eliminates issues with online shopping, saving consumers and businesses time and money.
Despite being a new venture, KitFit has global ambitions and hopes to take a piece of the $200 billion sporting apparel retail market in the next five years which represents a potential $500 million revenue opportunity for the experienced team.
To fast-track its growth the Aussie disruptor has embarked on an Equity Crowdfunding campaign with leading platform Equitise with ambitions to raise $800,000 which kicks off to the public today. Attracting early investment, Kitfit secured its minimum investment target of $149,900 during the initial private deal room phase. The equity crowdfund will contribute towards a total investment round of $1 million, $387,000 of which was previously secured before the offer opened.
The team behind KitFit captured investor’s attention early, with their strong pedigree of scaling startups and over 12 years of history working closely as a team from market-first startups and global technology companies like Yahoo!, News Corp and HotelsCombined. The Kitfit team has a combined 45 years of experience in engineering, technology, digital media, advertising and startups and has 12 years of team history and previous startup success including both acquisition and listing.
What is the story behind Kitfit?
KitFit’s founding CTO Mikkel Bergmann and Head of Software Engineering David Clark come from 6 years together at HotelsCombined, which was acquired by Booking Holdings in 2018 for AUD 200 Million. Joe and Andrew met in 2005 at a social networking startup that raised over $10 million by developing social mobile technology for Motorola Ventures and NTT DoCoMo.1 From 2009-2012 Joe and Mikkel were colleagues at NewsCorp working on solutions for digital storytelling, advertising, video and analytics across the News Corp Network.
The Kitfit project is the result of a career-long pursuit by founders, Joe, Andrew, Mikkel and David to discover better ways to connect people with products and services using data and technology. The team is driven by the reward of solving problems that help people spend more time doing the things they love, made possible by products that fit their needs and add value to their lives.
The proprietary mobile app delivers shopping experiences that are up to 50 times faster, 20 times more personalised with 10 times the fit accuracy of existing systems. For the average income earner, 70 – 90% of time spent online shopping is in the product discovery phase which means they waste 70 – 120 hours a year buying $500- $1,500 worth of products they end up returning.
KitFit Co-Founder Andrew Jacobs says the issue of “misfit” is a global problem that affects consumers and businesses.
“Globally, shoppers return over a third of all online purchases. Returns are merely a symptom of a more significant problem we call misfit. Which is essentially the misalignment of people and products. This problem represents an enormous waste of time, money and resources for both businesses and customers. It amounts to the order of hundreds of millions of dollars. As shoppers, it is hard to discover products that fit our specific needs. Kitfit solves that problem,” say Jacobs.
‘’Kitfit has a potential gross profit of $20 million from cycling and $100 million from adjacent verticals by 2025. Currently in its beta phase, the platform already has 100K followers on Instagram, over 10K of registered enthusiasts and 98 current or potential partners including the likes of Rapha and Oakley. We’re a platform that’s being developed for the community and in partnership with it, so it makes sense to us that the community should also be given the chance to become a co-owner as well,’’ he said.
The business has captured a niche area of the retail market which, once rolled out and utilised as a mainstream service, will flip the way consumers purchase products on its head. Founder of Equitise, Australia’s leading Equity Crowdfunding platform, Jonny Wilkinson is keen to see such an innovative and fresh concept join the platform.
“For us Kitfit is a revolutionary technology that is solving an issue people face every day. Despite online shopping being one of the fastest growing categories, the current systems around product discovery, like filtering, still result in pages and pages of search results and hours and hours of time spent searching for that perfect product. And despite all that time in product discovery, we still get it wrong one third of the time, creating an even bigger problem with returns and unused products. We’re therefore desperately in need for a superior solution for ‘misfit’ which is where Kitfit comes in.’’
How exactly will Kitfit work?\
The business will first launch within the cycling category and plans to expand quickly into the entire active lifestyle market and has over 172,000 monthly audience views and a global network reach of 1.48 million all before they’ve even officially launched.
Global online product return rates are as high as 40% and are a symptom of the problem of “misfit” – the misalignment of the product with the consumer based on their needs and expectations. Using breakthrough technology, Kitfit identifies proven products in use by people from all over the world and then matches them with the products that fit them best.
The visible cost of returns are tens of billions but the hidden cost is actually hundreds of billions of dollars. For retailers the most significant cost is the loss of brand advocacy, repeat purchase and even category abandonment. In addition, for every product that is returned there is an unknown amount that aren’t, adding to our landfill and wasting consumers money.
Initially, Kitfit will take a percentage fee on items purchased from retail partners and there are multiple plans for revenue streams including premium subscriptions and business intelligence for brands.
The team’s vision for the business is for Kitfit to provide fun, fast and an accurate product fit. Instead of browsing endless products and making rash or uninformed choices, Kitfit brings the best products to the consumer that are endorsed by its community and proven to fit. It does this by using a 4 dimensional model of fit based on a consumer’s social connections, interests, product/category knowledge and personal measurements and preferences.