Using Backyards as Showrooms, Online Furniture Retailer Outer Raises $4.3 Million

Outer, the direct-to-consumer outdoor furniture brand that uses backyards as showrooms, raised $4.3 million in a seed round led by Mucker Capital. The two-year-old Santa Monica based company has seen business boom during the pandemic as retail stores shut down and online orders surged. Suburbanites looking for a stay-cation plucked up their eco-friendly sectionals as consumers spent more time at home.

"We went from tens of thousands of dollars in monthly revenue to millions of dollars in monthly revenue," said co-founder Jiake Liu. "In April we hit profitability."

The closure of retail has given the company an opening and the rise of Airbnb has made consumers more comfortable going into strangers' homes.

Outer has tapped into the shared economy with a network of 120 showrooms in customers' backyards. The company pays its partners $50 a visit and says it has a waiting list of 6,000 applicants.

"We are catering to this new consumer who is so used to online shopping, but that doesn't take away the fact that people still need to touch see and feel a lot of products and specifically around furniture," he said. "People just want to sit in a sofa before investing $1,000."

The pandemic has brought in new opportunities.

Outer's low-slung sectionals range from $2,000 to $8,000, and are supposed to appeal to Restoration Hardware and Pottery Barn shoppers. Liu and co-founder Terry Lin, a former designer at Pottery Barn describe the design as timeless.

The products are manufactured in Liu's family-owned factory outside of Shanghai. The family, which has built furniture for retailers for years, shifted their production to source recycled materials. The new round of funding will help Outer develop better products and build a line of rugs, tables and other outdoor products. Liu also said he's focused on expanding content around outdoor living.

If working remotely catches on permanently, he said, it could help his business as people seek to work outside of urban cores to roomier homes with wider outdoor spaces.

The funding round pulled in some big names in Los Angeles consumer tech, including Honey co-founder George Ruan, GOAT co-founder Eddy Lu and Thrive Market co-founder Nick Green.

"It's truly an L.A. story and I am really glad about that," Liu said.