The Miami e-commerce startup headed by Keith Rabois plans big hiring spree, preparing for a pivotal 2022
Keith Rabois and his OpenStore team are quickly helping to prove that high-growth tech companies can be built in Miami.
Today, OpenStore, a rollup of Shopify merchants, announced it has raised a $75 million Series B funding round led by General Catalyst, with support from existing investors Atomic, Founders Fund and Khosla Ventures. The new funding comes on the heels of the Miami-based startup’s $30 million Series A in July, led by Khosla Ventures.
It has only been a year since Rabois moved to Miami from the Bay Area, proclaiming to a skeptical tech world that business can be done in the Magic City. Besides signing term sheets, the Founders Fund general partner in January started working on the new company with co-founder Jack Abraham, founder of venture studio Atomic. OpenStore came out of stealth mode with a half-dozen employees in the spring and launched in July.
Rabois’ requirement: OpenStore would be 100% built and grown in Miami, bucking the remote-first trend.
Since then, OpenStore has grown to over 35 employees with plans to reach 50 by the end of this year and grow to about 150 employees over the next year, said Matt Lanter, co-founder and Head of Product at OpenStore. The team is already outgrowing its Wynwood offices at the Annex and will be moving to a larger space next year, but will be remaining in the artsy neighborhood that has become a center of tech, Lanter said.
What is OpenStore? “We work with Shopify merchants and provide them liquidity so that they can sell their store and move on to something else or potentially start another store if they want to,” said Lanter, in an interview with Refresh Miami. Many of the 1.7 million businesses on Shopify generate less than $10 million in revenue, and when they are ready to exit they are too small to interest VCs or private equity. They’ve poured their heart and soul into their businesses and want to see them carry on. he said. “We are providing the opportunity.”
Once the merchant accepts the instant offer – and the cash – the store gets integrated onto the OpenStore platform of companies. Aided by the tech tools it built, the OpenStore team operates it, with the aim of taking the business to new heights for consumers in the exploding e-commerce sector.
The new funding will help build out the team here in Miami – in person. “We find especially for an early stage company, it’s just so valuable to be in this office and just talk to the person next to you,” Lanter said. So much of the funding will go toward hiring the engineers, designers, data scientists, and also operators that help run the businesses OpenStore acquires. The funding will also go toward buying many more businesses as OpenStore ramps up for a pivotal 2022.
Lanter said OpenStore started making offers to merchants in July and has acquired “many stores” that combined are already generating tens of millions in revenue. With the funding, “we’re excited to really put the pedal down next year,” he said.
Led by Rabois, OpenStore’s CEO, the team includes some of the best engineers and talent from companies like Google Facebook. Opendoor, Square, Affirm and Uber. The president and co-founder is Michael Rubenstin, previously the president of AT&T’s AppNexus and the founder of the Google-acquired DoubleClick AdExchange.
After growing up and graduating college in the Midwest, Lanter moved to the Bay Area and worked at Apple, Facebook and Opendoor before moving to Miami during the pandemic. As Rabois’ former chief of staff at Funder’s Fund, he “visited Miami and really kind of fell in love. It’s a great city, just a great quality of life.”
For Lanter, the decision to join OpenStore was an easy one, given his experience at Opendoor, another Rabois-founded company, now publicly traded, that provides instant offers to buy your house without showing it on the market.
OpenStore is hiring. It’s seeking engineers, designers, business development specialists, marketers and operators. While experience at a startup is helpful, it’s not a pre-requisite.
“I think the key is a growth mindset,” Lanter said. “We’re growing really quickly, things are changing all the time, much faster than a traditional tech company, so we want people who are excited about that – and open to that energy.”
The new recruits, Miamians among them, will be joining a high-growth company at an exciting inflection point, between building out the initial version of the product in July and the plan to acquire hundreds of companies next year and more than quadruple the team to 150 to run these businesses at scale. What’s more, the new recruits will be part of the growing #MiamiTech movement Rabois helped kick off as an early mover in a flood of investors and founders that followed. In the third quarter of this year, venture capital hit an all-time high for companies in the South Florida region, and has continued with raises such as the $150 million round raised by homegrown Papa, now a unicorn. OpenStore declined to release its post-money valuation but given that its valuation was reportedly $250 million after its Series A and reportedly about $750 million now, it is well on its way to becoming one, too.
Rabois’ “build in Miami” requirement hasn’t hurt OpenStore’s recruiting.
“I think Miami sells itself,” Lanter said. “Maybe people will be a little hesitant to move here like myself before I visited but the key is once a candidate visits, they just fall in love with the city.”
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