After raising US$18.5 million in Series A funding earlier this year—led by Upfront Ventures with participation from Breakwater Investment Management, Time Inc., Downey Ventures, M13 and Sterling VC—four-year-old Loot Crate is planning a significant expansion.
The L.A.-based e-commerce platform delivers themed mystery boxes to subscribers around the world. Each crate contains seven licensed products—many of which are exclusive to Loot Crate—and features everything from comic books to collectible figurines. It also recently created a new online channel for fans and now includes access codes for exclusive web content (including games and short films) in each mystery box.
“As we expand the company, we’re looking at new verticals, new opportunities in [various fandoms],” says David Voss, Loot Crate chief creative officer. “We are in the gaming space, which has a huge fan base, and we’re in the pop culture fan base. We think things like music and sports are very interesting-looking opportunities for us.”
Crates range in price from US$11.95 per month to US$130 for limited-edition premium boxes, and they ship to more than 600,000 subscribers of all ages.
Loot Crate typically works with two types of partners. There are intellectual property owners like Warner Bros. and Disney/Marvel that work closely with the company to provide products for established fan bases in what is typically a royalty-based relationship.
The other sees Loot Crate work with manufacturers to create exclusive products for Loot Crate community members, also known as Looters.
Some subscriptions—such as licensed Halo and Firefly programs— adhere to the same theme every month. Others—like the original Loot Crate box sub—change themes on a monthly basis. For example, February’s “Dead” box was themed around the releases of Deadpool and the new season of The Walking Dead.
In addition to examining aspects of pop culture not yet incorporated into a crate (i.e. music), Loot Crate is pursuing building long-term relationships with what it calls “cherished” brands. These brands might have large followings or smaller fan bases that are passionate but underserved. Ultimately, the deals will produce crates that might involve less of an element of surprise found in the original non-branded Loot Crate boxes, but will ensure subscribers receive items specific to their particular interests month after month.
As much as the platform expands into creating new property-specific crate subs through new areas of fandom, Voss says one aspect that will remain the same is Loot Crate’s pursuit of exclusive products.
“The focus for us, beyond expansions, is just exclusivity and designing products with our partners—and on our own—that are collectible and valuable to the community,” says Voss.
Exclusive items thrill subscribers, and the purchases made by Loot Crate mean guaranteed sales for manufacturers, he adds. So as opposed to putting items on a shelf and hoping they sell, each product is guaranteed to go into a crate and be put into the hands of a Looter.
And while one-off crates—like a recent Ghostbusters promo—have sold out quickly, Voss says the company isn’t looking too far outside the box when it comes to its subscription model. He hopes to create more partnerships like its deals with Halo or Firefly, which adhere to the subscription model and deliver crates on a monthly or bi-monthly basis.
“We’re a subscription-crate service, so subscription is the model we prefer,” he said. “When it comes to partnerships, we really are looking to find an ongoing relationship together with their fans.”
Voss did say, however, that Looters can expect crates tied to big, tent-pole events based on film and gaming properties later this year.