Sandra Oh Lin knew it would be easy for venture capitalists to typecast her as a “mompreneur.”
It was 2011 and she was raising money for a new company, KiwiCo, that would deliver educational projects to kids. A mother of two young children, she had just left eBay where she was leading their $2 billion-a-year fashion business. Maybe, they might think, she was more interested in pursuing an altruistic passion, rather than building a valuable company.
So she made sure she was ready to parry such misconceptions up front. “I didn’t lead with any ‘I just drove here in my minivan’ jokes,” she laughs. Instead, she stressed her background in consumer products and ecommerce – as an R&D engineer at Procter & Gamble prior to her eBay experience – and came prepared with carefully-researched market projections and a detailed operating plan. “It was all about showing ‘Here’s why I’m credible,’” she says. “And only one of my credentials is that I’m a mom.”
At least one VC didn’t need such assurances. Mayfield managing director Navin Chaddha had worked with Sandra as an advisor to Poshmark, the social marketplace for fashion that went public in January 2021. “Sandra was laser focused on her mission to foster creativity in children and I could tell that she had the acumen to build a big business,” said Navin. He quickly agreed to invest in KiwiCo’s $2 million seed round, even though the company was still just an idea.
A decade later, KiwiCo is riding a wave of success for monthly-subscription box services that Sandra was early to spot. Companies such as clothier StitchFix and pet products’ supplier Barkbox have gone public and Mayfield portfolio company, Grove Collaborative, which sells sustainable home goods & personal care products, recently raised funds that gave it a valuation north of $1 billion.
While it’s only just begun to do any brand advertising and has raised only $10 million in venture capital, KiwiCo’s traction with customers puts her in that cohort. The company has already shipped over 25 million Kiwi Crates to kids in 40 countries, who receive materials and instructions for educational projects such as slime circuits to learn about electronics and flying squirrels to learn about zoology and gliding.
Each crate is targeted at a specific age group and designed by a team of educators, engineers, and makers and tested extensively with kids in the intended age cohort. KiwiCo now has 8 different subscription lines ranging from infant to what they like to call kids-at-heart. “Since the beginning, our mission has been all about encouraging kids to become creative problem solvers,” she says. “We wanted to give them materials and inspiration to gain both the skills and that creative confidence to feel like they could actually make a difference and hopefully, change the world for the better.”
While that goal was there from the beginning, success didn’t happen overnight. The idea of subscribing to services that delivered physical goods was not yet widely accepted by consumers 10 years ago. “We were doing okay, but I wouldn’t say things were awesome,” Sandra recalls. “So we never assumed that we could raise more money.”
That forced the team to be efficient from a capital perspective. At one point early on, the company cranked out three new offerings, including an app for a kind of “digital refrigerator door” where parents could store and look at their kids’ creations, without big headcount increases. When they didn’t immediately take off, they made the decision to pull the plug within a few months. “We were disciplined,” she says. “If something wasn’t working, we didn’t chase growth at all costs.”
Mayfield supported KiwiCo by participating in a $5 million Series A round of financing in January 2012. Two years later, the firm helped round up investors to come together for a small financing which gave the company much needed runway. “One of our beliefs is in being loyal to a fault with entrepreneurs,” said Navin. “That cash infusion allowed Sandra to execute on her plans and continue to build KiwiCo into a vibrant subscription business.”
The KiwiCo team kept experimenting against the huge market opportunity. Grandparents alone spend $64 billion a year on gifts for the grandkids, and parents spend $5 to $10 billion a year on arts and crafts. The toy and activities market is over $100 billion.
A turning point came in 2014, when the company introduced Koala Crate for preschoolers, Doodle Crate for 9 to 16 year old art-lovers, and Tinker Crate for the STEM-oriented. Not only did they do well on their own that Christmas, but more than 20% of customers were soon ordering more than one. That vastly improved the economics, by increasing the lifetime value of customers and driving down shipping costs, says Sandra. By early 2016, it was profitable and cash flow positive, and they haven’t looked back.
The pandemic was an inflection point for the company. Through “Zoom School,” parents got a close up view of their child’s classroom and a deeper understanding of what they were learning – or not learning. Additionally, parents and children alike were hungry for non-screen experiences after spending all day on laptops and tablets for school and work. As a result, Kiwi saw its sales more than double and its employee count grow to 200. It has expanded beyond its age-specific subscription boxes, which cost $17 or $30 a month (less for longer-term contracts), with an e-commerce site that features scores of products, ranging from a face mask coloring kit to a build-your-own electric pencil sharpener. A company unit focuses on delivering products specifically for schools and organizations, including those serving disadvantaged children.
With the acceleration provided by the pandemic, the company has anchored market leadership and has many options to explore for the next phase of their financial journey.
Reflecting on the journey, Sandra says Navin, partner Tim Chang, and Mayfield have been an important sounding board and were always ready to lend a hand when she needed it. “They have been very helpful and very supportive at the right times, which is what you want from an investor,” she says.