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From The Dorm Room To Shark Tank To Augmented Reality

Thanks to smartphones, everything we do is easier than it used to be. At least, nearly everything. Moving is still a hassle. Buying furniture can be cumbersome between taking measurements, transportation, and finding the best price. And what if you want to see how that new couch would go with the rest of the room? Can’t exactly test it out.

That’s where Hutch comes in.

By using augmented reality technology, Hutch can show users what their room would look like with different pieces of furniture and layout designs. Through the app, which launched in February, users can also buy furniture and have it shipped directly to their home.

Benzinga sat down with Beatrice Fischel-Bock, the CEO and co-founder of Hutch, to learn more about the company and the entrepreneurial journey that’s taken her from her college dorm room to where she is today.

Benzinga: What is Hutch? What do you do?

Fischel-Bock: Hutch is a way to make buying furniture as easy and enjoyable as possible. So with Hutch, you take a photo of any space that you need furniture for or décor, and we send you back that space with a design.

You get a sense of scale, proportion, how it all looks together, and you can shop directly from that. You can find similar items, different budgets, different price points, and that is how you can design for your home.

The idea being that it does not have to be a whole room. If you have a boring office at work, boring desk at work, you take a photo of your desk, and we populate your photo with fun vases and candles and this and that to make it more beautiful, and you can buy any of that or you can try again with a different style.

Benzinga: How did you get started, and where did you get the idea to begin with?

Fischel-Bock: Originally, it was two co-founders and myself. We met at George Washington University in D.C. in college, and the three of us were in the interior architectural and design program. So we were the token friends that everyone asked for help.

So our junior year, everyone was moving into their first apartments in D.C., and we were getting all these questions. “Here’s a picture of my new apartment. What do you think I should buy?” That’s when we realized how easy it was to scale a room just by seeing a photo. So we decided, “why don’t we get paid for this kind of work,” and so we started our first company called ZOOM Interiors, which was a virtual interior design company.

Beatrice Fischel-Bock

Beatrice Fischel-BockYou paid $150 up front, and then we would put a look together and order all the furniture and send it to you. Then as we started to think about graduation and what was next for us, we realized we wanted to go much more mobile, and 75 percent of people who were using ZOOM Interiors were on their phones.

We realized how important it was to find a way to go fast and possibly free, if not bring the price way down. So we decided, we weren’t in business, so we didn’t know much about the VC world and that kind of thing. What we did know was Shark Tank, so we applied for Shark Tank. We got on the show. It was an intense journey, but what we got out of it was that Sean Rad, the founder of Tinder, watches Shark Tank. He is an angel investor, and he reached out and said he was interested. So we met him and he introduced us to our other two partners now, Ben and Ethan, who have a tech and product background.

So it was an interesting group that came together, and that was a year and a half ago when we started Homee. That was all conversation-based, and a feature we added is now what Hutch is today. We decided to later focus on the feature that everyone loved so much and that was taking a photo and getting a look back.

Benzinga: What was your initial funding?

Fischel-Bock: So obviously it all started with Shark Tank. We were on the show for some funding, but it wasn’t the right deal. Then we got introduced to the VC world through Sean and our partners and raised our original amount in September of 2015, so a year and a half ago, a pre-seed of $250,000 from Foundational Capital in San Francisco, and that allowed us to really get going and actually build the product. Once it was done we raised another $1.8 million, $2 million I guess in December, six months after getting that pre-seed amount, and then we started interfacing with clients, and six months later raised $5 million for our next round, and that was in July of 2016, so six months ago.

Benzinga: If it’s free for your clients, what is your business model? How are you making money?

Fischel-Bock: So we make money when you buy the furniture. We buy at wholesale prices and we drop-ship [from the manufacturer] direct to our consumers that we sell at comparable retail pricing. We don’t hold any inventory because of drop shipping, which has come about in the last five years, and there is more and more manufacturers out there who are able to drop ship just one piece at a time.

Our average orders are $1,500, which is the high price point. Our margins are anywhere between 10 percent and 25 percent. It depends on what retailer or manufacturer we are using.

Benzinga: How many clients have you helped so far?

Fischel-Bock: So with Homee, we had 40,000 conversations with clients, so we hit a lot of people. We’ve had a few thousand since we launched [on February 2].

Benzinga: Do you have a five-year plan? What types of steps are you going to make to continue to grow?

Fischel-Bock: We would really like to own the entire experience of buying furniture. Not only the hard-to-find furniture for your home...all the rest of it. Assembling the furniture, actually putting it in the right places, we would like to own it A to Z. So actually be able to deliver everything in one day, already assembled, placed in your home. That’s a big goal.

The other big goal for the product is to go even more lifestyle, so maybe we could do other things. Taking a photo of your outfit, take a photo of your face for glasses. We see this as also great for furniture, but also a general need in e-commerce, a different way of approaching the crazy millions of options online that are available to us.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.