Zonos Secures $69M to Simplify Cross-Border Commerce with APIs

Zonos Secures $69 Million Series A Funding to Enhance Cross-Border Trade Solutions

Zonos, a company specializing in cross-border commerce, has successfully completed a $69 million Series A funding round. The investment was spearheaded by Silversmith Capital Partners and will be utilized to further develop the company’s APIs.

Investment Details and Company Background

The funding round, categorized as a minority investment, also saw participation from individual investors including Eric Rea, CEO of Podium, and Aaron Skonnard, co-founder and CEO of Pluralsight. Founded in 2009 and based in St. George, Utah, Zonos has, until now, operated without external capital, as confirmed by founder and CEO Clint Reid.

Understanding Total Landed Cost

Reid clarifies that “total landed cost” encompasses all duties, taxes, import fees, and shipping charges incurred by international buyers when purchasing goods from the U.S. Accurately calculating these costs, however, often presents a significant challenge for businesses.

The Growing Cross-Border E-commerce Market

The global cross-border e-commerce sector was valued at over $400 billion in 2018 and is currently experiencing growth at a rate double that of domestic e-commerce. Zonos addresses this market need by offering APIs, applications, and plugins designed to streamline cross-border sales.

Simplifying International Transactions

These tools provide consumers with a precise final price for international purchases. Businesses retain the flexibility to select preferred shipping carriers, and customers can even choose their carrier during the checkout process.

A Technology-Driven Solution

“Businesses are not expected to be experts in every country’s regulations,” Reid emphasizes. “Our core mission is to foster trust in global trade through transparency. Historically viewed as a shipping issue, this is fundamentally a technology challenge.”

Board Addition and Strategic Vision

As a result of the investment, Todd MacLean, managing partner at Silversmith Capital Partners, has joined the Zonos board of directors. MacLean was particularly drawn to Zonos’s innovative approach and its location outside of traditional tech hubs.

Addressing Post-Purchase Surprises

MacLean observed that unexpected fees levied after purchase often lead to negative customer experiences, hindering brand loyalty. Providing upfront pricing and shipping information is crucial for a positive purchasing journey.

Unique Data Processing Capabilities

“Our research indicated that Zonos is uniquely positioned to interpret and utilize the existing data,” MacLean stated. “The overwhelmingly positive customer feedback demonstrates a clear demand for this solution, resulting in increased revenue and enhanced customer loyalty.”

Impact on Sales and Customer Lifetime Value

Reid notes that companies frequently experience a 25% to 30% year-over-year increase in sales. While shipping fees may occasionally lead to a slight revenue decrease, they often contribute to a longer customer lifetime value.

Strategic Timing for Venture Capital

Reid determined that securing venture capital was timely, given the increasing complexity of global trade due to evolving tax laws and the discontinuation of established trade regulations. He sought a long-term partner, a quality he found in Silversmith.

Future Growth and Expansion Plans

The new investment will accelerate product development, go-to-market strategies, and global team expansion into Europe and the Asia Pacific region. Zonos has grown from 30 employees 18 months ago to over 100, serving more than 1,500 customers worldwide and processing millions of landed cost quotes daily.

Becoming the Industry Leader

“Currently, we lead in APIs for cross-border e-commerce, but our ambition is to be the definitive technology leader across all industries,” Reid asserts. “We are committed to continuous improvement and expanding into new markets to better serve our global customer base.”