Processing returns is a big job for retailers. Total industry returns amounted to $743 billion in merchandise in 2023, according to the National Retail Federation and Appriss Retail.
Retailers have tried to make it easier for customers to return items. For example, Amazon partnered with Kohl's and Target began accepting returns of its car. Startups have also come up with new technologies to manage the delivery and return experience.
Returnmates, now renamed Influence, is the latest to attract new venture capital for its customer-centric delivery and return approach. The Los Angeles-based company raised $19.5 million in Series A led by 7GC. Additional participants include Blackhorn Ventures, Lightshed Ventures and Rise of the Rest Revolution. To date, the company has raised $25.6 million.
The company changed its name to Sway as a way to show its evolution beyond returns to last-mile delivery capabilities, company co-founder and CEO Eric Wimer told TechCrunch via email.
“We've created solutions to reduce retailers' costs, reduce environmental impact and eliminate friction for shoppers,” Wimer said. “For the shopper, Sway's home returns program reaches the customer wherever they are. No more printing labels, repackaging or waiting in line at the post office – you can process your return from the comfort of your home.”
Wimer, one of Uber's first employees, partnered with co-founder Kristian Zak to take on the package delivery and return experience after an ill-fated trip to the post office in 2020. Sway's approach is based on a platform of two-way communication and a Network of driver partners to control purchases from reception at the door to return.
Buyers use the two-way SMS platform and tracking page to get a 30-minute delivery/pickup time. They can add access instructions and add packages to your pickup.
The company offers retailers next-day and two-day delivery services, as well as a home return and exchange product that reduces the return cycle from a week to less than three days on average.
Sway co-founders Kristian Zak and Eric Wimer. Image credits: Influence
Since inception, brands using Sway have seen a 66% reduction in lost package rates and a 20% increase in repeat purchases compared to traditional carriers, according to the company.
“A return that is made through the Sway network is cheaper than one that is sent individually to the retailer,” Wimer said. “We verify the item in our warehouse before it is returned, thus preventing fraud and allowing us to activate an instant refund. “We also consolidate multiple returns into a single box, reducing per-unit shipping costs and eliminating the need for individual repackaging.”
As of August 2021, Sway has expanded to 20 cities and its team has grown from five to 100. During the same period, its revenue has increased 14 times and its customer base has increased 7 times.
Sway is currently active in California, Texas, Washington, Washington, DC, Maryland, Virginia, New York, and Florida. The new financing will allow the company to continue technological development, grow its team and expand coverage to 20 to 25 cities, Wimer said.
“Given revenue and customer growth in recent years, capital was critical to expanding our infrastructure, technology and presence to better support our brands, shoppers and driver partners,” Wimer said.
