Full service storage startup MakeSpace has secured an additional funding round of $17.5 million, which it will use to fund its expansion into five new markets.
The New York-based company has raised a total of $30.5 million since launching in 2013. The company offers pick up, delivery and storage of customers’ personal items in New York City, Washington D.C. and Chicago.
Founder and CEO of MakeSpace shared the news on Twitter:
— Sam Rosen (@sir) February 24, 2016
The recent funding round was led by Harmony Venture Partners and Upfront Ventures. Existing Series A and seed investors also participated.
Taking on the top dog
Mark Suster, managing partner of Upfront Ventures, published a blog post detailing MakeSpace’s future strategy, recent advancements and one of its top goals: dethroning Public Storage as the king of storage.
“Public Storage is the Blockbuster Video of their industry and we set out to build Netflix,” Suster wrote.
Suster said that the fragmented self-storage industry is ripe for disruption because operators “can’t innovate on their product and can’t lower costs or their business craters.”
Beyond the bin
MakeSpace has taken several big steps recently to expand its market share, including shifting from a strictly by-the-bin model to storing furniture too. Suster said that new option was a “game changer.”
“Of course we always knew the market would want furniture and we knew that 50% of the market wouldn’t store with us unless we had furniture,” Suster wrote.
The company has also began building its own warehouses. Unlike traditional self-storage facilities that rely on prime real estate, MakeSpace doesn’t need to pay a premium for visibility.
“We see our unit costs dipping to the point where it will look positively arcane to have a clunky storage facility in the middle of a major city like Manhattan or San Francisco,” Suster wrote.
You can read Suster’s complete breakdown of MakeSpace’s business plan and opportunity here.