Geeknet terminates a purchase agreement with Hot Topic and accepts a $20 per share bid by GameStop.
The start-up, fueled by $2.75 million in capital, emulates a Japanese shopping promotion.
Japanese department stores promote an annual New Year’s event called fukubukuro, in which they put various items into bags, seal them and sell them to consumers—who open the bags and trade with each other to get the products they want. Now an online start-up called Little Black Bag is bringing that concept to U.S. web shoppers.
Consumers can sign up at LittleBlackBag.com to get a bagful of cosmetics and fashion items; they then have a week to trade with other online shoppers. Customers can purchase one bag for $59.95 or sign up for a monthly subscription at $49.95 per bag. And, just as Japanese retailers sweeten the offering of leftover merchandise with a smattering of more expensive items, Little Black Bag says some customers will win hot seasonal products—“Delights” in the retailer’s terms—worth four to five times the price of the bag.
“There is a genuine void in the online fashion category for interactivity and excitement,” says co-founder & CEO Dan Murillo. “The vision for Little Black Bag is to bring the real-world thrill of discovery and shopping with friends to the Internet.”
Little Black Bag launched last week after announcing it had received $2.75 million in an initial funding round. Investors include venture capital firm DCM, former Facebook Inc. executives Chamath Palihapitiya and Tim Kendall, and technology investor David Tisch.
Little Black Bag says it will offer premium accessories, jewelry, handbags and home goods, with shoes and apparel to follow.