Fashion tech startup Pixibo raises $1.4m to power its first experiential store

How many times have you ordered clothes or shoes online, only to find that what you bought doesn’t fit?

But not only is returning merchandise inconvenient for the customer, ecommerce companies pay a hefty price for them as well. In fact, the cost of return deliveries in the Asia-Pacific region rose to US$256.4 billion in 2019 from US$130.6 billion in 2016, as per data from Statista.

In a bid to solve this problem, Singapore-based fashion tech startup Pixibo opened its first experiential store in January at The Centrepoint mall in the city-state’s Somerset shopping district.

Pixibo Fit Centre is where customers can opt for Pixibo’s Try Before You Buy service, and this new checkout feature enables shoppers to pay for their purchases only after they had tried them on.

The Try Before You Buy service option on Pixibo / Source: Pixibo

The company hopes to reduce the time and cost spent on customers’ merchandise returns, as “about 50% of the time, when people return a product, it’s because of wrong sizing,” Rohit Kumar, CEO and co-founder of Pixibo, tells Tech in Asia. With Pixibo Fit Centre, the returned products can go back into the online fashion brands’ inventories almost instantly, he adds.

Pixibo is further planning on opening two more stores in the eastern and western areas of Singapore.

The company’s shift in strategy toward expanding into brick-and-mortar stores was made possible after it had raised US$1.4 million in its extended series A round from early-stage VC firm Atlas Venture, a source with knowledge on the matter tells Tech in Asia.

The funding will be used to further develop its Pixibo Fit Centre, for which the company has signed a two-year lease with Frasers Property. It will also be used to hire staff for 12 new positions in its sales and engineering teams.

The Pixibo Fit Centre storefront in Singapore / Source: Pixibo

“Returns for online fashion retailers present a massive problem, with 40% to 50% of clothes being returned on average. We believe the new Fit Centre will take the company one step closer to its aim of providing the world’s first comprehensive returns management solution for online fashion retailers,” said Maxim Shkvaruk, investment director at Atlas Ventures, in a statement.

Pixibo launched in 2016 with the aim of achieving zero returns for online fashion brands. It began with its software-as-a-service (SaaS) platform Find Your Fit, which uses AI to recommend the right size and fit to shoppers. The solution is used by fashion marketplaces such as Zalora in Singapore, FashionValet in Malaysia, MAP in Indonesia, and Shinsegae in Korea, among others.

The company claims that over 30 online fashion brands have already signed up for its Try Before You Buy service since its launch, and that it is on track to add 50 retailers by the end of Q1 2021 and 100 more retailers by June this year.