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A Surprise in Every Birchbox

Delivering monthly boxes full of samples is the latest startup fad
A Surprise in Every Birchbox

Last fall Stephanie Niezgoda went online and signed up for Birchbox, which sends her a box of beauty product samples for $10 each month. The 22-year-old engineer was wowed by the expensive moisturizer she received in a recent shipment and decided to switch away from her longtime favorite brand, Clinique. The new one “costs $125, and I normally spend $20,” she says.

That’s why brands such as Elizabeth Arden are scrambling to give away samples to Birchbox’s more than 100,000 subscribers. The success of the New York startup is inspiring a clutch of other online subscription services specializing in everything from tea to children’s clothing. It’s a new twist on an old idea, and the startups offer a way for big brands to get their products into the hands of young, tweet-happy customers with money to spend. They’re also attracting a lot of attention from venture capitalists. “It’s a business model we love,” says Kent Goldman, a principal at First Round Capital, which has invested in three box services, including Birchbox. “You have regular subscribers; you have a direct relationship with them.”