The Future of Online Furniture Industry Model

Warsaw-based startup Tylko has been promoting its D2C (direct-to-consumer) model in the furniture industry. The model is supported by software that allows for a virtual fitting of the desired furniture into existing rooms and facilities.

tylko founders
Tylko Founders, from left: Jacek Majewski, Hanna Kokczyńska, Benjamin Kuna, Mikołaj Molenda. Photo: courtesy of Tylko

The Tylko tech-driven startup focuses on furniture construction and design. The company’s name translates to “only” in English, as the company aspires to be the only go-to company for any furniture need. Founded in 2015, it is one of few (if not the only) startups making it possible for customers to tailor-fit furniture to their room. The opportunities Tylko brought to the market have increased its revenue and interest across countries.

Tylko Application

The Tylko Augmented Reality (AR) app can be found online or in the app store and is key to designing the furniture. Once downloaded, the user points the smartphone camera toward the space where the selected furniture is to be fitted. The user then alters the selected furniture’s size, shape, and in some cases, number. Once finished, the picture with the designed furniture is placed as an order. As Tech Eu portal notes, once the order is sent, Tylko’s software automates the manufacturing process for production partners. The tailored and adapted furniture is delivered to the customer’s door within two weeks.

For those not using the application, Tylko website offers the design of furniture in a virtual room. The furniture includes all typical living room necessities, including bookcases, wall storage, wardrobes, desks, and TV stands, but also other items, such as shoe racks and bedside tables. The price is adjusted after all modifications are made and varies depending on the product’s style, density, width, and depth.

Tylko Business Model

The satisfaction of customers constitutes the most special feature of its business model. Less than 2 percent of customers used the option of returning the product shortly after they obtained it, which they can do free of charge. To put it into context, Tylko serves around 30,000 customers annually. The starup hopes that its D2C model will be the model of the future in the furniture industry. In this model, the app is designed to replace the role of the middleman. Key to it is the focus on individualism in the sense of respecting the demands of customers prior to constructing the furniture, which is not the case in many large chain stores today.

Tylko’s business model and products have been noticed on the international stage among investors. Last year news came out that it managed to raise 22 million euros, from the 26.2 million it was hoping to raise, in a Series C seed funding round. The product was evaluated and supported by venture funds Pitango Ventures from Israel, and Evli Growth Partners from Finland. Remarkably, in 2020, when most of Europe went into lockdown, the company increased by132 percent in sales.

Who is Behind the Venture?

Tylko is headed by a collective board of four people and employs more than 100 people. It was officially launched in 2015, but the founders have been designing the brand since 2014. Seven years later, the same people, with one exception, continue to run the startup. Their backgrounds are in architecture, design, management, and brand development. The motivation to start Tylko was to combine their expertise and bring innovation to the Polish market, which could grow into a future model.

“Most strategic decisions are made by Jacek and Mikołaj, and the rest is shared equally among the four of us. We are very different, but we complement each other very well. During these seven years of working together, we have become very close,” said Mikołaj Molenda, one of the co-founders and co-CEO’s, in a recent interview on their unique leadership model.

Tylko is probably the only startup of its type in Poland and the Three Seas Region that is working with an AR app in the furniture industry. A similar project can be found on the British Isles, where a company called Made has developed and designed an e-commerce platform that works on a similar D2C model.

After a promising start, the direction in which the online furniture and tech industry shall grow is still to be discovered. If it moves towards an online, more customer-based model, Tylko will then definitely be a forerunner for a long time to come.

Martin Hochel

Martin Hochel comes from Bratislava, Slovakia, and has also lived in Belgium and the UK. He holds a BA in history and politics from Birkbeck College, University of London and is currently studying for his masters at the Central European University in Vienna in nationalism studies. Martin also works as a junior analyst at the Government Office of the Slovak Republic. In his free time, he likes to read, play the piano, and travel.

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