Kidpik subscription boxes typically include seven items, including shoes.
Children’s subscription box company Kidpik today announced the pricing of its initial public offering of 2,117,647 shares of common stock at $8.50 per share, for aggregate gross proceeds of approximately $18 million, with trading starting this afternoon. The stock will trade on the Nasdaq Capital Market under the ticker symbol PIK.
Ezra Dabah, Kidpik CEO, has a long resume as a fashion industry executive. He continues to run Nina footwear, a family-owned company in which he acquired a majority stake in 2012. Prior to that, he led The Children’s Place for 15 years, where he grew the business from $150 million to $2 billion.
Kids apparel is an underserved market, in which Kidpik aims to gain share. “We’re extremely excited about the potential,” Dabah said. “We’re growing by leaps and bounds. In the first six months of this year, we sold $11 million worth of products or 1.1 million units.
“We have somewhat of a competitive edge,” Dabah said. “We have decades of expertise designing and merchandising everything in-house. There’s no middle man, so we’re able to deliver wonderful value.”
Kidpik offers expertly-styled boxes that contain seven items for at least three mix and match outfits as well as accessories and shoes for $98, making the average price per piece about $14. Consumers can order a box every four to six weeks or every 12 weeks, and can skip or pause their subscriptions as needed.
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“The reason I bought The Children’s Place was to bring design all the way down to the consumer,” Dabah said. “I made sure we always displayed full outfits in the stores, but consumers still had difficulty with styling. Being able to deliver complete head-to-toe outfits with Kidpik is a service to moms.”
To start the subscription cycle, customers fill out a three-minute survey about their child’s size and style preferences, choosing favorite colors, skinny, straight or distressed jeans, and fashion profile, classic, clean and simple designs, urban edge, girly or active and sporty. For girls, boxes contain handbags, hats and hair accessories.
Kidpik, which does 85% of its business in subscription boxes, started on Shopify and still offers a la cart options on the site. It also sells basics as multiples on Amazon and seasonal looks such as dressy pieces for the holidays are available on Shopify.
“We’re very excited to have additional funds,” Dabah said. “We’re looking forward to growing vertically and horizontally. We’re going to attract more members to our subscription base and add newborn.”
There’s also an opportunity to deliver fashion to teens. “We lose many customers at age 10 or 11,” Dabah said. “We have a lot of data and look forward to growing the business and adding different categories.”
Smaller boxes aren’t an option because of the cost of fulfillment and freight, Dabah said, but boxes with more than seven items is under consideration. The more consumers use the service, the more accurate the curation becomes.
Boxes arrive with the child’s name on the label, so they feel it’s theirs. “Everything is beautifully packed and personalized. They love the experience,” Dabah said, adding, “it’s more theirs than mom’s.
“Besides expertise in merchandising, it took us about five or six years to build the algorithm and make sure it’s frictionless,” Dabah added. “We’re fortunate that the average customer keeps 70% of the box. It’s a testament that our technology and algorithm are working well.”
