Storage-on-demand startup Boxbee has secured $5 million in venture capital to finance its expansion.
Metamorphic Ventures, a New York City, NY-based venture capital firm, led the funding round. VC firms Floodgate and Northgate, along with an unnamed “home improvement giant,” also chipped in funding.
In addition to entering new markets, Boxbee said it would use the money to ramp up its technology and delivery operations.
“This recent round of funding will allow us to further our growth beyond our current bicoastal presence to other major metropolitan areas, and continue to provide this level of service at scale,” said Kristoph Matthews, founder and CEO of Boxbee.
In April, the startup raised $2.3 million in venture capital.
Storrage lining up investors
Meanwhile, the CEO of Seattle, WA-based storage-on-demand startup Storrage told the Upstart Business Journal that it’s on track to raise $7 million in venture capital by next spring.
Storrage is led by Terry Drayton, an early pioneer of tech-driven delivery companies. Drayton co-founded HomeGrocer.com, which fell victim to the dot-com bubble in 2000.
To date, the startup has raised $1.5 million. The new funding will support a nationwide expansion, Drayton said. Now, Storrage serves only the Seattle area.
Both Storrage and Boxbee provide similar services: They pick up, deliver and store small crates of customers’ belongings. The companies charge a monthly fee for storage, along with a fee to have crates delivered to a customer upon request.
Boxbee and Storrage fall into the growing category of “on demand” service companies, a market that attracted more than $1.3 billion in investments in 2013. Examples of other companies in this sector include ride-sharing app Uber and grocery delivery service Instacart.
“Technology and urbanization are two main attributing factors as to the evolution of the on-demand economy, and there are no signs of either slowing down,” Boxbee’s Matthews said.
Boxbee reports 30 percent month-over-month revenue growth since launching in 2012, while Storrage reports 20 percent month-over-month revenue growth.
In the New York City market, Boxbee competes against another storage-on-demand startup, MakeSpace. Boxbee also operates in Northern California. So far, MakeSpace has raised more than $10 million in venture capital. In addition to scheduled pickup and delivery service in three New York City boroughs, MakeSpace offers service nationwide through a partnership with UPS.