Portland e-commerce entrepreneur Jordan Gal is back with a new startup and has raised a $6 million seed round to build his team and product.
The new company, Rally Commerce, is an e-commerce company in the center of what is increasingly becoming a decentralized space. Specifically, the unbundling of the consumer-facing front end of the online retail experience and the infrastructure backend.
Where companies like Shopify have built massive platforms that control the front and backend of the shopping experience, new tools are emerging that separate those functions. Rally has built a checkout product that unifies the different tools merchants can choose from for their online storefront and the backend operations.
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This whole area of unbundling the front end and the back end of e-commerce is known in the industry as headless commerce.
“We put merchants and app developers at the center and in control of a modern commerce ecosystem,” said co-founder and CEO Gal in a written statement. “Merchants are too often forced to accept the mediocre checkouts provided to them by underlying platforms, and app developers are subservient to the platforms they build for. It’s time we fix both.”
E-commerce platforms have bundled all the elements of online shopping. That worked as merchants started to move online, said Gal. Once the Covid-19 pandemic pushed even more shopping online, merchants and brands started looking for more flexibility to control the shopping experience, he said.
Gal has been working on Rally for about a year. His co-founder and chief technology officer Rok Knez, along with other leaders joined him at Rally from his last e-commerce company CartHook. In January he handed off the CEO role at CartHook, which is still running a successful business, to the company’s longtime director of customer success Emily Foreman.
The Rally team is 18 people. They have built the product and are now onboarding the first merchants to test the product this week. This round of funding, which came in waves, has been used to hire the team and build the product. Gal expects to raise a Series A early next year.
The seed round investors included Felix Capital, Rainfall Ventures, Long Journey Ventures, Afore Ventures and Commerce Ventures.
“The headless commerce space is booming as merchants and investors recognize the potential to create seamless and unique customer experiences across all touch points,” said Joseph Pizzolato of Felix Capital in a written statement. “Companies like CommerceTools, Nacelle, Fabric and Bolt are revolutionizing the old e-commerce stack. ... We see Rally in the same category. Jordan and team are fully reimagining the checkout process and are in good company to shape the future of e-commerce.”
Rally’s customers are merchants that are digitally native brands focused on e-commerce. Target customers are in the $10 million revenue range, but the company can work with bigger organizations, Gal said.
In building Rally, Gal has applied lessons learned from his time in building e-commerce tools for current platforms. He is particularly cognizant of the risks associated with tying a product to a specific platform. Any changes to that platform and its attitudes to third-party apps can have dramatic effects.
This time around, Gal is mitigating that risk by working with a broader set of partners, incorporating revenue sharing and understanding that attitudes can change. He is also incorporating elements of what is called Web3, a set of technologies that enable internet users to connect and transact outside of traditional commerce and content silos.
“We see Web3 and decentralization and crypto all pointing in the same direction,” he said. “We are pushing that forward in e-commerce. We want to see the power moved back to the merchants and app developers and away from platforms. We are an element in that ecosystem.”
Rally also has an element of cryptocurrency with a token it plans to issue to customers as a way to drive a network effect within the ecosystem. Gal plans to tap into traditional as well as cryptocurrency-focused investors for his next round.
