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Funding Success Stories from Square, Fab and Couchsurfing

Take a Page From These Ultra Successful Startups

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What were some of the biggest funding success stories of the past few years? Here's a look at three players who are actively working to disrupt the ecommerce, payments and travel industries. Their phenomenal funding success stories can teach the rest of us quite a bit -- even if we're working in decidedly more modest operations.

Fab.com

Funding: $105 million Series C round in July 2012, total outside funding of $160 million (TechCrunch)

What it is: Fab is an ecommerce destination based around a daily email that spotlights highly quirky and curated finds that have strong ties to the world of design. Consumer might find brightly colored furniture, quilts from India, artistic t-shirts or chocolate-covered bacon in a Fab email.

The backstory: Fab started out as social networking site Fabulis and "pivoted" from that business in May 2011 to its new identity as an ecommerce site in just 90 days. As it continues to grow, Fab plans to continue to evolve from its roots in "flash sales" to a well-known retailer for "everyday design."

Lesson to learn: Don't be afraid to change your game. Fab operates in a crowded email-to-ecommerce space and is thriving by daring to be different with a strong brand and brand voice. The founders were not afraid to pivot when market conditions were changing and find a very profitable niche for themselves.

Learn more about niche marketing here.

Square

Funding: $200 million Series D round closed in September 2012. Company is valued at $3.25 billion (All Things D)

What it is: Square is disrupting the payments industry with a small credit card reader that fits into your iPhone, iPad or Android device. Square can serve as a full point of sale system, and its low cost makes it attractive to small and medium sized businesses.

The backstory: Square was co-founded by Jack Dorsey, who was also a founder of the social network Twitter. Because of its "disruptive" nature and rapid growth, Square is often to compared to PayPal.

Lesson to learn: Look for opportunities to innovate everywhere. Dorsey cuts an impressive figure in the business world, and it may just be because he's been able to extract a lot of value out of commonplace items. Twitter has become something between blogging and text messaging, while with Square, Dorsey is aiming high, to be a part of every transaction on the planet through a simple piece of plastic that turns virtually any smartphone into a mobile register. By proving that he can scale the business quickly, he's got a decent shot at reaching those heights.

Learn more about mobile and online payments here.

Couchsurfing.com

Funding: With a relatively low $15 million Series B round relative to the others above, Couchsurfing is nonetheless riding a wave of interest in the "sharing economy," that allows people to rent or borrow goods like apartments, bikes and even dogs.

What it is: Founded in 2004, Couchsurfing is a social travel network that connects a community of 5 million members in more than 96,000 cities via its website and mobile applications. Individuals can arrange short homestays through the service.

The backstory: Founded in 2004, Couchsurfing initially eschewed traditional venture funding, instead focusing on the grassroots growth of its community of passionate users. In 2011, it raised $7.6 million dollars in funding with its sights set on growth.

Lesson to learn: Stay true to your roots. Couchsurfing is nothing without its community, and so with bigger funding came rumbles that the company would not be able to stay true to its freewheeling, community-focused ethos. Committing to use that funding to enhance user experience and enhance reach, Couchsurfing is so far growing apace.

Learn more about community-building here.

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