Michael Barlow wants to know where his couches are at all times.
“If we play furniture Tetris right, then we’re really optimizing the utilization of our assets and minimizing our overhead,” said Barlow, CEO of Fernish, a furniture rental startup.
The LA company announced on Wednesday it raised $15 million in Series A funds, with plans to expand into new markets, hire top talent and build out its backend system for organizing operations. Over the next year, the 40-person company plans to double its headcount, adding to its marketing, data, engineering teams and more.
“It’s a really interesting time in terms of the job market because you have so many people, who are so talented, who may not have been on the market looking for jobs in any other circumstance,” Barlow said.
The COVID-19 pandemic has changed who is working where, Barlow said. A record number of people are working from home and, over the past two months, Fernish has experienced a 300 percent increase in orders for office items, Barlow said. The company has doubled its number of desks, office chairs and shelving SKUs available in response to the surge in demand. Barlow said the company’s offer of temporary ownership appeals to the workers’ general sense of uncertainty.
“The rental solution that we offer is unique in a sense that, especially in the home office space, I don’t know how long I'm going to be in this circumstance,” Barlow said. “This is a great solution for three, four, five months.”
Over the next year, Fernish aims to make its service available to temporary renters outside LA and Seattle. He said the upheaval brought by the coronavirus has made him unsure of what market Fernish will enter next, but that the model would work well in areas like San Francisco, Denver and Chicago.
“If you would’ve asked me two or three months ago, ‘What’s your next city to go to?’ I’d be like New York,” Barlow said. “But now, it’s very unclear how quickly New York will bounce back and if it’s actually going to be as dense of a city or as attractive a market.”
As orders grow, the company plans to invest in its homegrown enterprise resource planning, or ERP, software, which it uses for managing and tracking inventory, customer records and financial accounting. The ERP system essentially lets Fernish play furniture Tetris by tracking, say, where a sofa is at any moment, knowing what condition it’s in and understanding when the item is expected to return to the startup’s warehouse.
The company aims to build out its ERP’s asset tagging system, which would allow a warehouse worker to scan a piece of lamp, for example, and measure every aspect of its life cycle, including its time in transit and cost of delivery, and communicate to the customer when they can expect their new lighting to arrive. Fernish also aims to integrate its ERP system with its marketing engine.
“It’s a marrying of a bit of a process with technology here,” Barlow said.
The Series A round brings total investment in Fernish to $45 million. Khosla Ventures led the round, with participation from Techstars Investments, RET Ventures and Tapas Capital. Intuit cofounder Scott Cook, HotelTonight cofounder Jared Simon, Zillow cofounder Spencer Rascoff, Scopely cofounder Eytan Elbaz, former Invitation Homes CEO Fred Tuomi and Jeff Wilke, Amazon CEO of worldwide consumer, also participated.
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