The Desire Company started because the founders recognized the market was missing a recognizable and trusted source for authentic product reviews, says co-founder and CEO Eric Sheinkop.
“Consumer trust in social media influencers has declined, and the overwhelming problem of fake reviews and misinformation continues to be a source of confusion and frustration for shoppers, contributing to the $750 billion of product returns in 2021,” Sheinkop says.
Working directly with brands and retailers, The Desire Company matches them with the right experts — athletes, nutritionists, make-up artists, chefs and more — to trial, test and review products, producing video reviews for use at the point of sale and across digital marketing channels. These partnerships are driving an increase in conversions, time on site and marketing effectiveness, resulting in a six times revenue increase for the company in the past 12 months.
With proof of concept established, a validated business model and traction with its key audiences — retailers, brands, experts and shoppers — The Desire Company sought funding to drive both its reach and growth. The original plan had Sheinkop looking to do a capital raise with The Desire Company’s own board, but then Valor Equity Partners expressed interest.
“They wanted to come in and help lead our Series A,” Sheinkop says. “So, we made it a little bit bigger than we were originally planning to do and Valor led it all, along with Cleveland Avenue. And Don Thompson was one of our first Investors — former CEO of McDonalds — and he founded and leads Cleveland Avenue. So, we just got this great opportunity.”
In the early going, Sheinkop says he wished he had a better explanation of what The Desire Company does and maybe even hired a third party to help.
“When you're doing something brand-new you know everybody says, ‘I'm The Airbnb of this, or I’m the Uber of this.’ Well, we were doing something that we couldn't even point to anything,” Sheinkop says. “We were filling an absolute gap in the retail landscape and in social media marketing landscape with experts in product education, and it was very hard to explain what we were trying to do, looking back.”
With a total $14 million raised since inception, and a $78 million valuation as of its last round, the company has driven growth through key hires and strategic marketing, and has opened a new studio in Chicago to increase production capabilities to meet growing demand. Now that the word is out, The Desire Company is looking for its Series B.
“We're really having a lot of success now with enterprise-level partnerships with retailers and that's what we're building our team for,” Sheinkop says. “So, we want more partnerships being built into the media networks at Best Buy and things of that nature.”
Sheinkop spoke on the Smart Business Podcast about his new approach to social influencing and how he learned from mistakes with previous capital raises. Hit play to catch the full conversation.
Revenue increase for who? The Desire Co.? Or clients?