Pubeco, who specialize in helping retailers digitalize all those annoying paper ads and catalogs they send potential customers, has just announced that they raised 1.25 million euros from French VC ISAI (Blablacar, Commerce Guys, Shopmium, & more). Since its founding in 2008 by Romain Sarels and Yannick Lalleau, Orchies-based (in Northern France) Pubeco has grown steadily to reach a solid 700k consumer subscriptions and more than 100 retail outlets. With the ISAI capital injection, they plan to accelerate their growth, double the size of their team, and triple their number of subscribers in 2 years.
Having ISAI as an investor, who have done several investments in the social shopping and shopping promo space, is definitely a big win Pubeco. Having the backing of a good VC that has experience in the sector will be a big advantage for them as they push to accelerate their growth. In addition, their board, which according to the Journal du Net comprises such notable members as Yves Peis (previous with Vivarte and PriceMinister), Frédéric Bartoli (founder of infobebes.com and previous director general of Lagardere Interactive), Jacques Etienne de T’Serclaes (a previous retail sector partner at PriceWaterHouseCoopers), and Arnaud Barey et Pierre Brisset, founders of VoyagerMoinsCher, will continue to offer them invaluable connections and sector experience. However, the consumer promotion business is notoriously a tough one (ask Groupon and LivingSocial about that one…yes, different models, but still a similar objective).
Pubeco has obviously been very successful in getting over the first hurdle, that being getting retailers on their platform (and not doubt they can expand even further). But, getting 2.1 million consumers to, at the very least, occasionally go on their platform to scroll through the various promos available will be a very difficult proposition. In addition, although their platform eases the promo process and reduces costs for the retailer, it doesn’t necessarily make the whole process of discovering relevant promos that are out there easier for the consumer. Even if consumers sign-up and specify some preferences on their platform, many retailers (not all) still present offers in the same format as they do in paper mailings, just in digital form.
Given what they’ve achieved thus far coupled with the positive trends in this space, it’s hard to deny that Pubeco definitely looks promising. However, in addition to driving adhesion to their platform, if they haven’t already, perhaps they should consider investing in improving the user experience to make sure that a good chunk of those new joiners actually become active users.