July 15, 2013, 12:13 PM

Four furniture retailers will invest in Furniture.com’s e-commerce site relaunch

The site doesn’t hold any inventory, and retailers handle all logistics and delivery.

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Value City Furniture, American Signature Furniture, Rooms To Go Inc. and Leon’s Furniture Ltd. will each invest in the site Furniture.com, the online retailer announced today. Private equity firm Mistral Equity Partners also backs the web site.

None of the retailers or Mistral would disclose the amount of their investments.

The new funds will go toward building the Furniture.com brand and improving its e-commerce technology, says president and CEO Carl Prindle.

Furniture.com, No. 232 in the Internet Retailer 2013 Top 500 Guide, only takes orders from consumers who live in areas served by retailers that work with it. “Our retail partners handle all logistics and deliveries, leveraging their local inventory and furniture delivery expertise,” he says. “This leads to a far better shopping experience, as the shopper's furniture is nearby, will be delivered and set up by furniture experts and can be serviced easily if needed.”

Furniture.com sells to customers in the United States and Canada. Through the retailers, it can deliver to 72% of the U.S. population and that percentage is growing each month, Prindle says. The site takes a share of revenue from each delivered order, though he declines to reveal its rates.

When Furniture.com launched in 1999, it handled logistics and deliveries for site sales—but that quickly proved to be a difficult business model for the category, he says.

“The original Furniture.com attempted to be the ‘Amazon of furniture,’” he says.  “However, delivering couches and dining room sets is much more complicated than delivering the simpler items listed on Amazon—a sofa simply doesn't fit in the UPS-based distribution model that Amazon was built on.”

The 39 housewares/home furnishings retailers in Internet Retailer’s 2013 Top 500 Guide last year accounted for just 4.04% of all U.S. sales in the category, which totaled $138.9 billion. But that shows there’s plenty of potential growth because it “hasn't yet gone online in a meaningful way,” Prindle says.

Rooms To Go is No. 283 in the Top 500 Guide.

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