Monday, November 10, 2008

Report: Second Rotation pulls in $6M in second round

By Mass High Tech Staff

Boston startup Second Rotation Inc., which buys and sells used electronics through its online service Gazelle, has secured $6 million in a second round of financing, according to published reports. The funding was led by Boston-based Rockport Capital Partners, with additional investment from Venrock Associates, Austin Ligon and Henry Vogel.

The company said it plans to use the financing for new technology, as well as marketing efforts, website PE Hub reports.

Second Rotation follows a “recommerce” business model in which consumer electronics are either resold by the company to promote reuse of products or directed to the appropriate recycling area. Company co-founder Rousseau Aurelien said he calculates the value of electronic goods using a “dynamic pricing calculator.”

The company generates revenue via a 35 percent markup on each item. Last year, cell phones and personal digital assistants comprised the most popular product categories, followed by iPods and digital cameras, according to Aurelien.

The company told Mass High Tech last month that, despite a doom-and-gloom economy, Second Rotation was experiencing growth from consumers eager to save money through reused products.

Second Rotation’s Series A round of funding came in January when it raised $4.4 million from Venrock Associates, as well as three angel investors.

Founded in 2006, Second Rotation also announced in January its board of directors with five new members: David Beisel, vice president of Venrock; Austin Ligon, co-founder and former CEO of Virginia-based CarMax Inc.; Mike Tyrrell, general partner at Venrock; Ashton Peery, a former general partner at Lucent Venture Partners; and Henry Vogel, former chief revenue officer of New York-based Quigo Technologies Inc.