The funding round was co-led by Forerunner Ventures and Index Ventures, with participation from Google Ventures and True Ventures. Daydream plans to use the funds to hire engineering talent and scale quickly. The company, which will focus on the fashion vertical initially, does not plan to fulfill orders but will act as a discovery layer for shopping, relying on commission-based revenue. It may also consider white-labeling its technology in the future.
Key takeaways:
- Daydream, a new e-commerce search engine that uses AI to make search more personalized, has raised a $50 million seed round. The platform is set to launch in beta to U.S. consumers this fall, focusing initially on the fashion vertical.
- The search engine allows users to search for products using natural language and image recognition, and has already onboarded more than 2,000 brands, including Net-A-Porter, Altuzarra, and Jimmy Choo.
- Daydream's founder, Julie Bornstein, believes that current e-commerce search tools are not personalized enough and often don't give accurate results. The company is working on fine-tuning models and creating a detailed dataset of product catalogs to improve this.
- Despite competition from large companies like Amazon and Google, as well as startups like True Fit and Remark, investors believe Daydream has an opportunity to build special experiences with deep personalization and that its experienced team will give it an edge in the market.