The startup world has a new unicorn, and its name is Away.
Recently, the online luggage retailer and direct-to-consumer travel brand has collected $100 million in Series D funding, and is now valued at $1.4 billion.
Away joins the ranks of other “unicorns” — private companies worth over $1 billion— like Slack and WeWork. Ride sharing giants Uber (UBER) and Lyft (LYFT) were also unicorns before they went public.
Jen Rubio, Away’s co-founder, attributed the latest cash infusion to a number of factors, many of which are based on function and branding.
“Everyone takes a bag with them when they travel,” Rubio told YFi PM in an interview this week.
“We found a way to build a brand that emotionally resonates with people and really connects with them. Where before, luggage brands were just selling bags, and I don’t think that’s what consumers are looking for today,” she added.
In a growing U.S. economy, it also doesn’t hurt that Americans are ramping up vacation plans — and want to look stylish doing it. According to a new national survey from Discover, 71% of consumers plan to take some sort of vacation this season, a jump from the 58% percent in 2018.
The global industry for luggage will be worth nearly $55 billion by 2025, according to one estimate by Hexa Research. That makes Away keenly aware of brand building, something Rubio and business partner Steph Korey are used to.
Both previously working for eyewear company, Warby Parker. Before creating the first Instagram-worthy baggage in 2015, the pair went straight to the source—consumers.
The company initially surveyed 800 people on what features they’d be looking for in a product. Amid lots of complaints about luggage, Away found that consumers look for a few key things: Bags should be durable, easy to carry, and easy to navigate on wheels.
Most unicorns aren’t profitable, but Away boasts a direct-to-consumer model that helps them stay out of the red.
“We’re profitable on each suitcase that we sell,” Rubio told Yahoo Finance. Even still, the company has no immediate plans to sell an initial public offering, as other unicorns have done (or plan to) this year. For the time being, Rubio said growth and expansion are the main focus.
“Even though we’re venture-backed, the type of business we want to be one day is one that makes a profit and could go public, if we want to,” Rubio said — adding that Away’s latest capital round gives the company “optionality” in the future.
In just over 3 years in business, Away has sold over a million suitcases— and is on track to make $300 million in revenue this year. It has plans to open 50 more stores in the next few years.
“We have our hands full right now,” Rubio said.
Away’s latest fund raising round was led by Wellington Management, with participation from Baillie Gifford, Lone Pine Capital and Global Founders Capital.
Sarah Smith is a Segment Producer/Booker at Yahoo Finance. Follow her on Twitter: @sarahasmith
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