TryNow - Try It Before You Buy It Software

Thanks To This Week’s Sponsor…

If you’re building the next massive startup, security & compliance are not optional; they’re vital. Check out The grnmrk Newsletter to learn security best practices and get your startup compliant today!

Company & Team Introduction

One of the biggest deters from e-commerce shopping is the uncertainty of the purchase. Do I need a large? Will this part fit? These are questions that are frequently going through our heads while shopping online. Benjamin Davis founded TryNow in 2018 to solve this problem after leaving his previous startup, Saint Haven, a nontoxic fabric clothing e-commerce brand he helped co-found with Jacqueline Sacks. TryNow’s software lets e-commerce brands offer customers the option to try items before purchasing. You don’t pay for clothes at a store to try them on, so why should you do it online? TryNow’s team has grown to ~25 employees as a globally distributed remote team.

Product Overview

TryNow’s software enables Shopify Plus stores to offer customers the option to try items before they buy them by handling all the trial tracking, analytics, charging credit cards at the appropriate time, and integrating with return management systems such as Loop and Returnly. When a company uses TryNow, they incorporate a button on the product page (similar to BNPL solutions). If shoppers checkout with the TryNow button, their credit card is not charged, and their trial begins the day the item arrives at their door. Customers can easily select to return what they don’t want and keep what they do. Merchants control their campaign and can put constraints on their trial offerings, like setting different trial lengths, limiting the cart size of Try Now Pay Later orders, and limiting entry points to the website where TryNow is available as a checkout option.

Total Addressable Market

It is hard to pinpoint the total addressable market for TryNow due to the nascency of the Try Now Buy Later market. The market is massive, rapidly growing, and has use cases spanning multiple verticals, including apparel, accessories, fragrances, furniture, and general quality satisfaction. Still, it is also important to note that TryNow isn’t a valuable solution for all purchases. For example, buying a box of Kleenex or a bag of apples with Try Now Buy Later wouldn’t make sense. There are currently over 28k merchants using the Shopify Plus platform that TryNow is targeting.

Business Model & The Numbers

To further align incentives with their customers, TryNow uses a transactional business model that takes a percentage of each product bought with their Try Before You Buy checkout button. They offer a generous 45-day trial to show the results their software can drive to grow businesses. After the trial period, the company takes 2.99% of the net transaction amount after potential returns + $0.99 per order. Some metrics backing up TryNow’s value proposition:

• 93% of shoppers give Try-Now-Buy-Later a “Love it!” rating

• Up to 24x return on investment

• 16% increase in online store sales

• 63% higher average order value

Traction

TryNow’s technology and revolutionary take on online shopping has already brought in multiple massive names in the e-commerce world, including brands like luxury watchmaker Jack Mason, Elwood Clothing, Goodlife Clothing, SHEFIT, and Snif Candles. The results that TryNow has generated for these brands are incredible. For example, Jack Mason saw a 2.4x increase in Return On Ad Spend, and SHEFIT improved their conversions by more than 2x with TryNow enabled!

Competitors

Due to being so early in their market, the competitive landscape is incredibly favourable for TryNow, with only one actual threat, the first mover in the space, Blackcart. Blackcart was founded in 2017 by Donny Ouyang and is headquartered in Toronto, Canada. Blackcart has raised two rounds of funding totalling over 20M+, including investments from 500global, Citi Ventures, and Struck Capital. Blackcart’s product is a direct competitor to TryNow’s Try Now Buy Later solution; both companies were founded around the same time, have the same 3% transaction fee, and are at the same investment stage. What separates the two companies? Their target markets: TryNow specifically targets Shopify Plus stores, where Blackcart will work with brands on Shopify, BigCommerce, WooCommerce, Magento, and Salesforce Commerce Cloud. TryNow targets the most prominent customers on the biggest platform, whereas Blackcart has a broader e-commerce presence.

Deal Terms

TryNow has only raised two funding rounds since being founded in 2018. Craft Ventures led their seed round in 2019 at an undisclosed valuation. The company also raised a 12M series A round in March 2021 from noteworthy firms, such as a follow-on investment from Craft Ventures, Shine Capital, Third Kind VC, SciFi VC, and prominent angel investors like David Sacks himself and Plaid Co-founder William Hockey.