Local startup and baby product review site, Tell Me Baby, has completed a $5.5 million capital raise in a bid to accelerate its growth within Australia and prepare for its e-commerce launch into China, as parents become increasingly conscious of the products they purchase for their children.
The raise was led by Cornerstone Growth Capital along with a top off from equity crowd-funding platform, OnMarket.
Investors say it was Tell Me Baby’s strong team and value proposition combined with the large addressable market that got them excited. Chairman of Tell Me Group, David Holmes, who is also CEO of Fergus Software and former CEO of CarAdvice.com, adds to Tell Me Baby’s credibility given his known expertise in scaling emerging businesses.
Why has Tell Me Baby attracted this funding?
Since starting in 2016, Tell Me Baby is quickly reaching its goal of becoming one of Australia’s leading product review sites, especially with its unique model of being driven by authentic reviews by mums and dads from all over Australia. In just three years, the site now reaches over 600,000 parents in Australia each month.
Its co-founder and CEO Mathew Colbron says the capital will be used to tap into the local and mainland Chinese market. By expanding into this space, the platform will become a trusted site for both local Chinese and Daigou shoppers to make more informed purchasing decisions.
“Knowing that trusted Australian brands and products are in high demand to Chinese consumers, our expansion into China will also allow users to purchase products directly from our channels providing them with an end-to-end trusted shopping service. For brands, our community provides qualified leads with consumers that represent with high propensity to purchase,” said Colbron. The investment capital will also be used to launch Tell Me Group’s second vertical to be announced before the end of the year.
Why is Tell Me Baby looking at China?
Fuelled by Chinese anxiety over counterfeit goods and product safety at home, the daigou market in Australia is worth in excess of $850 million, proving the Chinese consumer perceives Australia as a global leader for producing high-quality and trusted goods. The Australian Trade and Investment Commission also revealed that skincare, baby and child-specific products along with mens’ grooming products accounted for record highs in exportation to China, positioning Tell Me Baby as the ideal in-between for Chinese parents seeking trustworthy Australian products.
In terms of their business strategy, Tell Me Baby’s platform will act to alleviate some of the difficulties mainstream brands face when trying to penetrate the Daigou market. By facilitating a community of genuine reviews from everyday parents, the platform will help Australian businesses gain entry to the Chinese market without China’s cultural barriers. Likewise, it will help local Chinese and Daigou shoppers know which brands Aussie parents love the most.
Some of Australia’s biggest baby brands, including Nestle, Huggies and MooGoo have already recognised the power of the platform to connect with this lucrative demographic and drive product purchases. The company has also started working with hundreds of Australian Chinese mums who have an interest in Australian baby products by strategically promoting the company and its services through prominent Chinese marketing channels such as WeChat, Little Red Book, and Weibo.
The next 12 months will see Tell Me Baby’s rapid growth through the booming Chinese market with its e-commerce launch and its second vertical vertical which will be aimed at both Australian and Chinese consumers.