August 11, 2011, 12:52 PM

Children’s apparel retailer Zulily raises $43 million in funding

The private-sale web merchant will hire more staff and boost marketing.

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Zulily Inc., a private-sale e-retailer selling children’s apparel and goods, today said it had raised $43 million in a new funding round led by Meritech Capital Partners.  This marks the third funding round for Zulily, No. 589 in the Internet Retailer Second 500 Guide; the retailer says it has raised $53.6 million since launching in January 2010.

Zulily plans to use the funds to hire employees and step up marketing. Craig Sherman, managing director at Meritech, will join Zulily’s board. "The site has become the tastemaker of children's fashion and I look forward to being on the board and part of their success as they become the next big brand in children's retail,” he says.

Zulily says it offers at least 15 exclusive sales each say, with products selling for 50% to 90% off full retail prices. Zulily announces its limited-time sales via e-mail messages to members sent at 6 a.m. Pacific time; sales last 72 hours. Today, Zulily also announced that it has launched a mobile app for iPhones.

"We have an opportunity to provide the best access to mom, baby, and kids' boutique brands not found elsewhere,” says Darrell Cavens, the retailer’s founder and CEO. “The additional funding will help us deliver even more value to our members, provide an even better experience, and raise the bar to meet customer demand."

Cavens and co-founder Mark Vadon both came from online jewelry retailer Blue Nile Inc., which is No. 60 in the Internet Retailer Top 500 Guide. Vadon, who was the CEO of Blue Nile until February 2008, remains the chairman of the board of the web-only retailer.

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