It's a Happy Day for Happy Returns as PayPal Acquires Another LA Startup

Ben Bergman

Ben Bergman is the newsroom's senior finance reporter. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks.

It's a Happy Day for Happy Returns as PayPal Acquires Another LA Startup

PayPal Inc. has gobbled up another Southern California startup.

After acquiring Honey, a modern twist on coupons, in 2019, PayPal announced Thursday it has purchased Santa Monica-based Happy Returns. Terms of the deal were not disclosed.


The company allows online shoppers to return items at one of 2,600 physical stores like Paper Source and Cost Plus Market in 1,200 metro areas instead of the more cumbersome process of having to pack up and mail items back to a retailer. That allows independent retailers to have a shot at competing against the likes of Amazon and Walmart.

"Today, the box-free, in-person return process we pioneered is now table stakes in ecommerce," co-founders David Sobie and Mark Geller wrote in a blog post announcing the deal. "Hundreds of brand partners use our returns software and reverse logistics services, and our momentum is accelerating, enabling us to bring delightful returns experiences to a growing population of online shoppers."

PayPal first made a strategic investment in Happy Returns in 2019 and the company plans to further integrate Happy Returns as part of its transition from a payments platform to what it calls a "digital commerce enablement engine."

While Honey helps users before they make a purchase, Happy Returns comes in after they buy something. Ecommerce sales shot up during the pandemic, as did item returns. Online sales often frustrate retailers because the return rate is much higher than in-store purchases.

The 2019 B Round valued Happy Returns at $55 million, according to Pitchbook data.

The exit is a coup for Upfront Ventures, which led Happy Returns' 2015 seed round at a $6 million post-money valuation.

"In the nearly seven years since they started the business, venture and tech deal dynamics have gone through an incredible evolution, and return logistics software was not a slam-dunk sale in the early years," Upfront partner Greg Bettinelli wrote in a blog post. "It's a true testament to David and Mark's skill and resilience that they continued to build Happy Returns feature by feature, logo by logo, always keeping an eye toward operational and cash efficiency without sacrificing customer experience. They made returns a thing."
https://twitter.com/thebenbergman
ben@dot.la

Subscribe to our newsletter to catch every headline.

Cadence

LA Tech ‘Moves’: Adtech Firm OpenX Lures New SVP, Getlabs and DISQO Tap New VPs

Decerry Donato

Decerry Donato is dot.LA's Editorial Fellow. Prior to that, she was an editorial intern at the company. Decerry received her bachelor's degree in literary journalism from the University of California, Irvine. She continues to write stories to inform the community about issues or events that take place in the L.A. area. On the weekends, she can be found hiking in the Angeles National forest or sifting through racks at your local thrift store.

LA Tech ‘Moves’: Adtech Firm OpenX Lures New SVP, Getlabs and DISQO Tap New VPs
Photo by James Opas | Modified by Joshua Letona

“Moves,” our roundup of job changes in L.A. tech, is presented by Interchange.LA, dot.LA's recruiting and career platform connecting Southern California's most exciting companies with top tech talent. Create a free Interchange.LA profile here—and if you're looking for ways to supercharge your recruiting efforts, find out more about Interchange.LA's white-glove recruiting service by emailing Sharmineh O’Farrill Lewis (sharmineh@dot.la). Please send job changes and personnel moves to moves@dot.la.

Read moreShow less

This Week in ‘Raises’: Miracle Miles Lands $100M, Fintech Startup Tapcheck Hauls $20M

Decerry Donato

Decerry Donato is dot.LA's Editorial Fellow. Prior to that, she was an editorial intern at the company. Decerry received her bachelor's degree in literary journalism from the University of California, Irvine. She continues to write stories to inform the community about issues or events that take place in the L.A. area. On the weekends, she can be found hiking in the Angeles National forest or sifting through racks at your local thrift store.

This Week in ‘Raises’: Miracle Miles Lands $100M, Fintech Startup Tapcheck Hauls $20M
Image by Joshua Letona

In this week’s edition of “Raises”: An L.A.-based footwear company closed $100 million to boost its expansion into the global market, while there were Series A raises for local fintech, biotech and space startups.

Read moreShow less
RELATEDEDITOR'S PICKS
LA TECH JOBS
interchangeLA
Trending