Interview with John Tomich, Onestop Internet

Story by Benjamin F. Kuo


Yesterday, Rancho Dominguez-based Onestop Internet ( announced that the firm has raised $13.3M in a Series A venture round. We had the chance to talk with co-founder John Tomich about the funding and the firm, which operates e-commerce sites for fashion brands and others.

What's the background on Onestop Internet and what you do?

John Tomich: We've been around for five years. The company was incorporated in January of 2004, and we provide outsource e-commerce services to organizations, such as brands and retailers. Lots of them are in the apparel space. The business model works for other industries as well.

We have six key categories of what we do. One, is we build and design websites. The second, is we provide fulfillment services, such as product shipments. Third, is we provide customer care and phone support for orders; the fourth is the software technology, the platform that powers everything. The fifth is product photography--we actually have an in-house photo studio, including doing things like Photoshop and color correction. The sixth is marketing analytics, including SEM/SEO, collecting customer names, emails -- we use ExactTarget for emails, and Omniture for Analytics. Obviously, there are companies that do what we do in each of the six silos, but our special sauce is we provide all six of those together, typically as a turnkey, revenue share business model. We sign multi-year terms with brands, and have about 30 different companies we're working with.

Why did your firm decide to find funding now?

John Tomich: Actually, we're profitable, and have been profitable for several years. Bessemer approached us. We started getting approached by venture capital and private equity, and we have eight figures in revenue. We've never raised outside capital, but decided to do a late stage round from a VC firm. We like Bessemer because of their experience in the consumer retail space, and decided it would help us to grow to the next level. It turned out to be fortuitous timing, we closed the round in literally, late, late, late 2008. Who knew then that things would get so shaky. So, we have a really strong balance sheet to help grow the company.

What's the background of your team--did your founders come from the fashion industry, or the Internet?

John Tomich: I came from the Internet side. I was working for a small venture capital firm, Shelter Capital Partners, and before that I was working for iXL. My two other partners are also from the Internet. Our Chief Architect is from Scopus, an early CRM firm from the early 90's--he's a Silicon Valley, software, CTO type of guy. My other partner started an online, credit card processing business. We're all technology guys in the way, and were not in the apparel space.

Do you have specific plans for the raise?

John Tomich: The funding give us a strong balance sheet, to help grow the company. We're expanding into Europe, growing our marketing and technology platform, and just acquired a company--Billion Dollar Babes--which is a closeout sales firm, which has been around for eight years offline. We're now expanding that business online. We have several hundred thousand shoppers as part of our email database, and we do two-day, private sales for designer brands, which are 60-70% off from retail. We also just launched a site for Lululemon which makes athletic apparel. There's now a warehouse in Canada, because half of their customer base is Canadian. That's an example of our international expansion, which helps us serve multinational retailers better.



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