Fintech & e-commerce Retail and Direct To Consumer

Arfa Becomes Chord, Acquires Yaguara, Bags $18M Series A For D2C Platform

Commerce-as-a-service software company Arfa made some big announcements Wednesday: a name change to Chord, an acquisition of software company Yaguara and an $18 million Series A raise.

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Co-founders CEO Bryan Mahoney and chairman and COO Henry Davis started New York-based Arfa in 2019 after working together at Glossier and seeing the challenges entrepreneurs faced in launching their brands. The company’s commerce platform focused on creating the next generation of direct-to-consumer brands.

“Glossier had a tech team of 65 people, and a trend we were seeing was the next wave of tech-enabled brands, but they needed the right tools,” Mahoney told Crunchbase News. “They needed the right technology to give D2C companies the ability to enhance their businesses. We are the infrastructure company for them: We make it possible to not only collect first-person data, but they don’t need to be a tech company to do it. They can be tech-enabled.”

While developing Arfa’s software, Mahoney and Davis realized the potential for the D2C industry at large and decided to focus exclusively on selling its technology and data products.

That, combined with the acquisition of Denver-based Yaguara, and the pair decided to make a clean start as Chord.

“Arfa was born to create brands, but we thought changing the name would make a clean start,” Mahoney added.

They developed Chord to enable entrepreneurs avoid the heavy and disproportionately expensive technical lift required to create unique customer experiences, the challenges of accessing and using proprietary data, and the ever-increasing cost of customer acquisition and retention.

The company offers a headless commerce stack combined with a data component that Mahoney calls commerce-as-a-service, enabling entrepreneurs and operators to get in on the competitive e-commerce landscape without investing millions of dollars building up technology and data teams.

The concept of “headless commerce” is one of the buzzwords gaining traction in the growing e-commerce space. To Mahoney, it means brands being able to scale quickly and not hitting some of the traditional roadblocks when it comes to gathering, analyzing and using data.

Companies focused on the space are also gaining attention from investors. On March 4, Webscale, a multicloud SaaS tool that provides access to technology enabling e-commerce businesses of all sizes to automate their processes on the cloud securely, closed on $26 million in Series C funding led by BGV, STCAP Ventures and Mohr Davidow Ventures.

Eclipse Ventures led the Series A and joined existing institutional investors, including Foundation Capital, WhiteStar Capital, Forerunner Ventures, Index Ventures and Thrive Capital, as well as a group of angel investors. Mahoney said funding to date for the company was $18 million.

“Chord is taking advantage of the tailwinds of e-commerce, which includes a fundamental shift of API,” Matt Mulvey, partner at Eclipse Ventures, said in an interview. “It also comes down to the team. Bryan and Henry have run e-commerce companies and brands before. We were looking to take advantage of headless, but felt like the whole phenomenon was missing ‘a brain’ of how to take all that technology and buzzwords, feed all that data and flexibility across omnichannels, and then serve those insights back to the owner or brand. Enter Bryan, who was building e-commerce for over 20 years.”

Meanwhile, Mahoney expects to deploy the new funds into technology development and data, as well as to build out Chord’s team, which now includes Leslie Lorenz, former director of data and analytics at Lululemon, who is joining the company as vice president of data.

Although Mahoney wouldn’t disclose growth figures, he did say that Chord is working with a number of beta customers in the trenches and expects to end the year with a product that is evangelized by agencies and engineers and sells itself.

“We want to be known as the Stripe of headless commerce,’” he added. “It is a playbook we are happy to copy, and we are on track to do that.”

Illustration: iStock

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