This May, when sampling platform Material Bank announced a staggering $100 million fundraise, CEO Adam Sandow told Business of Home that acquisitions were on the horizon. A scant four months later, he’s made good on his word. Material Bank has acquired London-based procurement platform Clippings. The price of the deal was not disclosed.
“We look for ways to serve designers and make specifiers’ lives easier. [Clippings] has built a suite of products that do just that,” Sandow tells BOH. “[The acquisition] goes towards our focus towards making it easier for the design industry and taking away pain points.”
Clippings may be unfamiliar to American readers, though it’s an established presence in the U.K. and across Europe. The company, founded in 2014, has two core businesses. The more well-known is an online marketplace that seeks to bring Amazon-like e-commerce to procurement for (mostly commercial) design projects. Designers use the free online service to source product from more than 650 brands; Clippings handles the shipping and logistics and earns a margin on the sale. In that respect, the platform is similar to the crop of stateside online marketplaces that have sprung up in recent years, including SideDoor, Design Trade Services, Daniel House and Bellvine. Each has its own unique features, but all are looking to consolidate the design industry’s scattered purchasing process in one place.
Sandow says that the marketplace service will continue to expand in Europe, but he has no immediate plans to bring it to the U.S. Instead, his focus will be on Clippings’s other business: Licensing its technology to design-world brands to use as a turnkey solution to power their e-commerce. (Many of those deals are private, but Herman Miller used Clippings for its HMPro e-comm platform, which launched earlier this year.)
The plan, says Sandow, is to license the Clippings technology to the thousands of design brands that are eager to do more business online but don’t have the resources to build their own tools from scratch or modify an existing platform to work with the peculiarities of the trade. The result would be a kind of Shopify tailored specifically for the design industry.
“Our partners are asking for this. [They’re] saying, ‘We’re not a tech company. We’re not even an e-commerce business. We sell through dealers. But we’ve got to be much better online,’” says Sandow. “It’s an interesting situation where these companies need help to come into the future and they don’t want to spend a lot of capital upfront and they don’t want big teams.”
It’s not hard to see the potential synergies. As the two platforms become intertwined, businesses that use Clippings to power their e-commerce operations will likely find it fairly easy to add Material Bank as a sampling service. By the same token, a discounted or free rate on Clippings software could be used as an incentive to entice brands onto Material Bank.
“Now what we’re able to say to brands is, ‘Not only can we drive incredible leads to your sales reps [through Material Bank], but we can help empower your sales reps with better software to take orders online, to do quotes, to strengthen [your] digital performance,’” says Sandow. “We can help U.S.–based manufacturers with a deeper bench of services.”
The big-picture implications are also clear: Material Bank aims to become the default sampling engine for the entire design industry. If it succeeds, and Clippings in turn becomes the default e-commerce tool, Sandow will have built a major portion of the infrastructure that powers the industry as it slowly continues to migrate online.
Though Sandow described the acquisition of Clippings as a significant investment, he suggested that there’s plenty of cash left in the war chest and that more deals are coming. “We’ve got a big pipeline of acquisitions,” he says. “We’re just getting warmed up.”
Homepage photo courtesy of Material Bank