Dims

Growth Stage

Contemporary furnishings from the world’s top emerging designers

Analytics

Raised to Date: Raised: $624,862

Aggregate Commitments $

Platform

Republic

Start Date

06/18/2021

Close Date

08/20/2021

Min. Goal

$25,000

Max. Goal

$1,070,000

Min. Investment

$100

Security Type

SAFE

Funding Type

RegCF

Series

Seed

Valuation Cap

$12,000,000

Discount Rate

0%

Rolling Commitments $

Status
Funded
Reporting Date

08/31/2021

Days Remaining
Funded
% of Min. Goal

2,499%

% of Max. Goal

58%

Likelihood of Max
Funded
Avg. Daily Raise

$9,918

Momentum
Funded
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Location

Los Angeles, California

Industry

Consumer Products, Goods & Services

Tech Sector

Non-Tech

Distribution Model

B2B/B2C

Margin

Medium

Capital Intensity

High

Business Type

Growth

Dims, with a $12 million valuation cap, is raising crowdfunding on Republic. The company collaborates with top furniture designers of the world and sells heirloom-quality furniture on its platform. It licenses original designs from award-winning designers and produces them exclusively for its customers. Eugene Kim founded Dims in March 2017. The proceeds of the current crowdfunding round, with a minimum raise of $25,000 and a maximum raise of $1,070,000, will be used towards new hires, physical showrooms and retail popups, editorial content, and more SKUs. Dims generated $2.2 million in revenue in 2020, with $449,000 in December 2020. The products have been featured in Dwell, AD, Vogue, and NYT and have generated a high demand even amidst COVID-19.

Summary Profit and Loss Statement

Most Recent Year Prior Year

Revenue

$2,190,282

$141,221

COGS

$1,271,817

$149,602

Tax

$0

$0

 

 

Net Income

$-789,494

$-434,416

Summary Balance Sheet

Most Recent Year Prior Year

Cash

$158,727

$60,443

Accounts Receivable

$2,067

$1,082

Total Assets

$557,605

$218,526

Short-Term Debt

$628,121

$372,461

Long-Term Debt

$850,665

$65,000

Total Liabilities

$1,478,786

$437,461

Financials as of: 06/18/2021
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Ratings

Analyst Report

Synopsis

Buying furniture is an expensive but unavoidable step of renting or buying a home. About 84% of Americans buy their furniture new, and 74% buy in person. The furniture industry is a legacy industry that still relies mostly on showrooms and sales commissions. Consumers spend several thousand dollars at these furniture megastoresanywhere from $4,000 to $9,000 depending on where they liveand they spend at a wide variety of stores. Though brands like Ashley and IKEA seem to dominate the furniture market, they actually held less than 5% of the market share as of 2016. 

In this market, Dims. sees an opportunity. Dims. is a direct-to-consumer, design-focused furniture company partnering with independent designers to create stylish couches, tables, and more. These artistic pieces are sold to consumers via the Dims. website, which emphasizes the perspective of each designer and the limited-edition nature of their creations. 

Beyond aesthetics, Dims. is focused on modernizing the furniture industry with transparent supply chains, almost made-to-order production cycles, and reduced markups. The company is cutting out the big-box mystery of the furniture industry and giving customers an insight into the journey of their furniture all the way from design to delivery. By doing so, Dims. is attempting to build a simultaneously socially conscious and profitable business. 

Dims.’s current Republic raise has been rated a Deal to Watch by the KingsCrowd investment team.

Price

Dims. is raising a Crowd SAFE at a $12 million valuation with no discount. That’s not an unreasonable price, given the company’s growth of 1,450% between 2019 and 2020. On the other hand, $12 million represents a 5.5-times revenue multiple, which seems a tad steep for a physical goods company with minimal intellectual property or other intrinsic value. All in all, the Dims. price rating is slightly above average but still moderate.

Market

The US online household furniture industry is valued at $47.1 billion in 2021 and is expected to grow by 3.1% this year. The market grew aggressively in the 2010s as more and more consumers became comfortable buying furniture online, but in-person sales are still the norm. In 2020, just 12% of consumers preferred ordering furniture online. 

Wayfair and Amazon dominate the online furniture-buying market. In 2019, 63% of online furniture sales were made on one of those two websites, and those giants’ performances only increased last year. Wayfair reported 84% growth in the second quarter of 2020, thanks to a boom in online furniture buying during the pandemic. The sudden shift to working from home, combined with the risk of visiting in-person furniture stores, caused many consumers to turn to the internet for new desks, chairs, and other types of furniture.

Dims. is hoping to carve out a niche in the remaining segment of the market not held by Amazon and Wayfair. Assuming conservatively that only 30% of online furniture sales remain after Amazon and Wayfair’s share, Dims. could hope to address a total market of roughly $14.1 billion. Despite working in the shadow of major brands, that’s a pretty significant market opportunity. The furniture market is massive, so even small players can generate solid revenue. That’s why Dims.’s market rating is higher than average.

Team

Dims. was founded by Eugene Kim, a finance attorney turned equity crowdfunding executive. Kim earned a BA from the University of California Berkeley and then obtained a JD from the University of Southern California. He spent seven years as a practicing lawyer, bouncing around a few firms. In 2015, Kim became the head of product at NextSeed, the first equity crowdfunding platform to be registered with the SEC. He served in that role for almost two years before founding Dims. 

Late last year, Eugene’s wife, Vivian Kim, joined the Dims. leadership team as COO. Her background is very similar to her husband’s. She attended NYU, then obtained a JD from USC. After about five years as an attorney, she joined the NextSeed team and served in successive roles in marketing and operations before departing to join her husband at Dims. 

The Dims. husband and wife team is highly credentialed with solid experience in the startup world. It’s no surprise that the company is raising an equity crowdfunding round, given its founders’ experience at NextSeed. Eugene has undoubtedly learned a great deal about scaling startups as he supported countless companies in raising capital. Despite the team’s lack of specific experience in the furniture industry, the Dims. team is well qualified to lead a high-growth startup. Thus, the company’s team score is one of its highest.

Differentiators

Dims. has two key differentiators that set it apart from mainstream furniture companies. First, the company is very design-forward, partnering with independent designers to produce unique, eye-catching pieces that can’t be found in the average furniture warehouse. Aesthetics are the core of the Dims. brand and the products it sells. Dims.’s target consumer is a wealthy millennial who craves high-end, artsy furniture for their home. 

Second, Dims. distinguishes itself from other furniture companies in its embrace of socially-conscious business practices. The company plans to register as a B Corporation by 2025 to lead the industry in socially and environmentally responsible operations. By partnering (and sharing revenue) with diverse, up-and-coming designers, Dims. is building a more equitable furniture industry. Plus, the company’s focus on nearly made-to-order, lean manufacturing helps it to match supply with actual demand, reducing inventory and waste while delivering more value to the consumer. 

These are well-articulated differentiators. However, it’s not clear how much of an advantage they actually give Dims. in a highly competitive furniture market. There are countless independent furniture brands in major markets across America, all focused on what they believe to be excellent design. There are also many startups pitching modern aesthetics at direct-to-consumer prices with pieces that strongly resemble Dims.’s offerings. Wayfair or Amazon could also easily create a product line focused on diverse, up-and-coming designers, which could diminish the novelty of Dims.’s concept. Therefore, Dims.’s differentiation rating is just middle-of-the-road.

Performance

Dims. has achieved significant growth since its founding in 2018. In 2019, Dims. generated just $141,221 in revenue. In 2020, revenue skyrocketed to over $2 million, a year-over-year increase of 1,450%. Such a huge revenue increase is uncommon for young startups and indicates early product-market fit. However, it’s worth noting that Dims.’s net loss also increased significantly between 2019 and 2020, from roughly $434,000 to $789,000. So the company’s growth may not be particularly sustainable. 

Apart from finances, Dims. is also showing more qualitative signs of a high-growth company. Dims. furniture has been featured in a number of leading publications, from The New York Times to Esquire and Vogue. The company is working to expand its business-to-business (B2B) channel and has already partnered with leading architects and interior designers as well as corporations like Adidas and LinkedIn. 

So far, almost all of Dims.’s performance signals seem to be positive. The company is generating significant revenue and has a strong foothold in both direct-to-consumer and B2B distribution. That’s why Dims.’s performance rating is one of its highest.

Risks

There are several areas of risk that prospective investors should consider when evaluating Dims. Most importantly, Dims.’s financials tell the story of a company growing rapidly but spending a significant amount on user acquisition to get there. Though Dims. supposedly has a healthy customer acquisition to customer lifetime value ratio — meaning its customers’ lifetime value is increasing while its costs to acquire those customers are staying flatlong-term profitability still seems to be a concern. In addition, Dims. is led by a husband and wife team, which puts the company at risk in the case of divorce. Plus, Dims. doesn’t currently have any other senior executives to help stabilize the business in that scenario. Prospective investors should also note that the furniture market is highly competitive, with companies like Amazon and Wayfair hitting their strides and eating up more of the market share. This is a dynamic, volatile space that Dims. is not guaranteed to excel in.

Bearish Outlook

The online furniture sales market is currently dominated by Amazon and Wayfair. These are trusted brand names with thousands of reviews, established return and exchange policies, and other benefits that ease the concerns of consumers who are still nervous about buying furniture online. Beyond those leaders, the market is fragmented and highly competitive, and it’s not clear yet that Dims. has what it takes to win out. The company experienced significant growth in 2020, but so did every other online furniture retailer. It’s hard to say whether growth will continue once consumers are free to return to in-person furniture shopping post-pandemic. All in all, Dims. is still a young company operating in a difficult industry, so it’s impossible to guarantee that Dims. has what it takes to continue growing rapidly.

Bullish Outlook

Dims. has built an excellent brand that stands on clear differentiators: modern aesthetics driven by diverse, up-and-coming designers and sustainable business practices that align with millennial preferences. That generation is moving rapidly into higher income brackets and home ownership, which is perfect for Dims. As the company continues to gain publicity from major publications and open showrooms in large markets, its base of potential customers will only continue to grow. 

Plus, Dims. has a solid opportunity to expand its business-to-business revenue channel. Though fewer corporations are in need of well-decorated offices thanks to the remote work trend, there are still millions of square feet of office space in the US that need to be furnished. Many companies are prioritizing design and socially-conscious practices as they build their office looks. Bulk orders from corporations could provide Dims. with the capital to invest more sustainably in user acquisition, potentially helping the company to move closer to profitability. 

If Dims. can continue to post significant year-over-year revenue growth, it will become a worthy target of acquisition by a larger furniture brand or other lifestyle company looking to double down on furniture (Target, for example). Dims.’s founder, Eugene Kim, has strong credentials and experience to potentially navigate the company toward that exit. If Dims. can achieve a sale, investors could benefit significantly.

Executive Summary

Dims. is a high-end online furniture company partnering with up-and-coming independent designers to create beautiful, functional pieces for the modern home. Dims. grew by 1,450% from 2019 to 2020, with thousands of consumers embracing its aesthetic offerings and socially-conscious business practices. If the company can continue to grow steadily from both its consumer and business revenue channels, it could be well-positioned for an acquisition within the next several years. 

Of course, investing in any early-stage startup is risky, and Dims. is no different. The online furniture market is extremely competitive, with a huge number of brands focusing on modern, chic aesthetics and low-markup direct-to-consumer production cycles. That’s not to mention Wayfair and Amazon, which together own more than 60% of online furniture market share. However, Dims. is led by a well-credentialed founder who has expertly built the brand and expanded market share thus far, so there’s good reason to believe that Dims. has what it takes to continue scaling. Therefore, Dims. has been rated a Deal to Watch. 

For questions regarding the KingsCrowd staff pick or ratings for this company, please reach out to support@kingscrowd.com.

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