- Jet.com founder Nate Faust has a new e-commerce startup called Olive.
- It consolidates shipments from major fashion and accessory brands into weekly deliveries.
- Faust said his experience at Walmart and Amazon contributed to the idea behind Olive.
- Visit the Business section of Insider for more stories.
Jet.com cofounder Nate Faust is back with a new e-commerce startup.
And this time, he’s got an eye on sustainability with his new company Olive.
Using the startup’s online platform, users can shop from a host of fashion and accessory brands. Their orders are then consolidated into one weekly delivery, sent in a soft zippered box that is reusable and made almost entirely out of recycled materials. Olive calls the reusable boxes “shippers.”
The idea is to make as few deliveries as possible, thus reducing the carbon emissions associated with last-mile delivery. According to Bain & Company, a Walmart study from 2017 found that the carbon emissions for two items shipped together were 35% lower than if they had been shipped separately.
Faust said his years of e-commerce experience inspired the idea. Before he cofounded Jet.com with Marc Lore in 2014, he worked at Quidsi, the parent company of Diapers.com and Soap.com, which was sold to Amazon for $545 million in 2010.
Jet.com was sold to Walmart for $3.3 billion in 2016. After that, Faust spent three years as the senior vice president and head of US e-commerce supply chain and logistics for the big-box giant, and he was CEO of Jetblack, Walmart’s personal shopping service, until it was shut down in early 2020.
“As I was trying to think about what I wanted to do next, having spent that last decade-plus focused on driving consumption and growth, I really wanted to do something with a social or environmental impact,” Faust told Insider in a recent interview.
He said the idea for Olive struck him one night as he was taking out his trash and recycling and spent close to 30 minutes breaking down boxes.
“It just sort of dawned on me, that this is crazy that we’re 25 years into e-commerce, yet this is the status quo delivery experience,” he said.
Billions of packages are being sent each year, but they’re largely “single-use, one-way packaging, and not only is that terrible for the environment, it’s a huge customer pain point,” he said.
Olive is launching Wednesday with several hundred brands already signed on, including Adidas, Anthropologie, Everlane, Michael Kors, Outdoor Voices, and ThirdLove.
It has an app as well as a Google Chrome extension that facilitates using the platform directly on retailers’ own websites.
Olive doesn’t hold inventory for these brands. When a customer places an order on Olive, each retailer will pick and pack the order like it would for a usual direct online purchase. It then sends that order to one of Olive’s consolidation centers – it has one in California and one in New Jersey – where it is prepared for the customer’s weekly delivery. If the customer made multiple orders from multiple brands, they would all be packed in to the same reusable shipper before being delivered.
That delivery could be scheduled to be made weekly or more often if the customer is a frequent shopper, according to Faust.
If customers want to return an item, they can initiate the return in the Olive app and then leave the reusable “shipper” on their doorstep for it to be picked up.
The company is working with local courier services to synchronize pickups and deliveries in urban areas. In more suburban areas, it is partnering with traditional carriers, including the US Postal Service.
In addition to the potential reduction in last-mile carbon emissions, Faust is hoping that Olive’s business model will nearly eliminate the use of cardboard boxes in e-commerce. While consolidation centers are still receiving shipments from retailers in boxes, Faust hopes that will not be the case forever.
“Once we have enough volume coming from any given fulfillment center, or any given retailer, we will then provide those totes for free directly to the brands so that they can pack into those from the beginning,” he said.
Convenience as a selling point
Faust said that convenience is also a factor that he hopes will make Olive appeal to shoppers. He said that both Diapers.com and Jet.com had systems in place for delivering every item in an order at once.
“That was something that, resoundingly, customers loved, especially compared to the experiences with some larger retailers where you place, what you think is a single order and you get a stream of incoming boxes for the handful of items that you ordered over the course of a couple of days,” he said.
Dorie Smith, the CEO and cofounder of women’s workwear brand Of Mercer, which has partnered with Olive at launch, added: “We believe anything that would make our customers’ shopping experience easier, like having all their orders arrive simultaneously through one platform, will be quickly adopted by them. More than that, I think many of them would be excited by the prospect of reducing their own carbon footprint.”
Faust self-financed the company in its first few months of operation. In December, it closed a round of venture capital funding with contributions from SignalFire and Primary Venture Partners. The financial details of the seed funding round were not disclosed.
Marketplaces like Olive have been popular with investors lately, as the COVID-19 pandemic has accelerated growth for the e-commerce sector and brought consumer businesses online to an extent not seen previously. Since marketplace businesses do not typically carry inventory themselves, they tend to be very capital-efficient, Fabrice Grinda, founding partner at investment firm FJ Labs, said in an interview with Insider in December.
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