Highlight Raises $18M for its Tech-Enable In-Home Product Testing Platform That’s Empower Brands to Make Informed Decisions Faster

Highlight Raises $18M for its Tech-Enable In-Home Product Testing Platform That’s Empower Brands to Make Informed Decisions Faster

Time Stamp: August 21, 2023 12:27 PM
Source Node: 2229525

Collecting user feedback gives companies a new way to step back and see the product through the eyes of its users.  For product companies, this is often done at home through what’s called in-home usage tests (IHUT).  Falling under market research, this typically involves a market research company, that’s contracted by the brand, to work together to send product samples to users to collect reactions to scents, tastes, effectiveness, and even packaging.  However, unlike other forms of market surveys, this segment hasn’t adopted much technology or digitized and this hinders brands from making informed and timely product decisions.  Highlight is a physical product intelligence platform that allows brands to conduct end-to-end in-home product testing platform.  The tech-enabled platform handles all facets of the process including test design, recruitment, logistics, feedback collection, and associated analysis. By modernizing the process with attention to software and design, the platform differentiates itself by offering more sophisticated targeting, streamlining the process by reducing the time needed for testing and analysis, and by increasing completion rates (90%).  Consumer brands are also able to get to market faster with more confidence and Highlight has already worked with leading consumer brands like Estee Lauder, Pepsi, P&G, Nestle, Mondelez, Sakara, Church and Dwight, and Colgate, providing them with an elevated research experience.

AlleyWatch caught up with Highlight Founder and CEO Dana Kim and Cofounder and CPTO Ethan Kellough to learn more about the business, the company’s strategic plans, latest round of funding, and much, much more…

Who were your investors and how much did you raise?

This was our Series A, co-led by Acre Venture Partners and HearstLab with participation from Ingeborg Investments and GS Futures, and 10+ powerhouse angels including Jag Bath (former CEO of Favor, which sold to HEB) and Ryan Nece (managing director of Next Legacy Ventures). This brings our total raised to date to over $30M.

Tell us about the product or service that Highlight offers.

Highlight is an end-to-end physical product testing solution. Our platform facilitates all components of the research process–from recruit to logistics, recording feedback, and generating insightful data.

Highlight has now helped hundreds of brands — including Nestle, Estee Lauder, P&G, Target, Sakara, and Hanes — test thousands of products. Here are just a handful of examples of how companies have used Highlight to get their products into the hands of consumers for honest feedback at scale:

  • VERB Energy proved their caffeinated bar superiority to win more retail shelf space.
  • Georgia Pacific ran large scale testing of entire paper goods categories for faster benchmark data.
  • Cabinet Health gathered product and packaging data to ensure the success of a massive retail rollout.
  • Youthforia tested beauty products for consumer claims ahead of a Shark Tank pitch.

What inspired the start of Highlight?

We started this company just under three years ago with the belief that physical product intelligence is essential to success in today’s hyper-competitive market. But physical product companies face many challenges to understanding customer needs and collecting critical feedback to create exceptional, enduring products. We’ve felt the pain firsthand — spending far too many hours recruiting specific audiences, combing through fraudulent panelist lists, programming and reprogramming surveys, ensuring the assembly and delivery of shipments, and manually managing this clunky process from end-to-end. There had to be a better way.

How is Highlight different?

Highlight revolutionizes the IHUT process by seamlessly integrating technology, streamlining the end-to-end workflow. In stark contrast to the complexity and fragmented nature of traditional IHUTs, all project-related data for a brand is consolidated and easily accessible through a single, user-friendly platform.

Gone are the days of grappling with countless emails to initiate a product test; now, users can swiftly set up a project within minutes on the platform, observing real-time data flow into dynamic dashboards within a matter of days. Leveraging Highlight’s exclusive, rigorously screened, and diverse community, researchers can acquire the invaluable, high-quality insights they seek from their target consumers.

Whether the focus is on discerning feedback from cat-owning millennials or pinpointing preferences of women above 50 in California with oily skin and a penchant for retinol products, Highlight offers unparalleled access to these distinct audience segments. Moreover, brands can even test their products with the youngest of participants, with parental involvement ensuring a comprehensive perspective.

Lastly, Highlight empowers brands to confidently test a wide array of products that were previously challenging or even deemed unfeasible, including frozen goods, blinded items, and alcoholic beverages.

What market does Highlight target and how big is it?

30,000 products are launched every year, and somewhere between 80-95% of them fail, depending on who you ask. We aim to slow the rate of failure and boost our customers’ confidence in each launch, despite this competitive reality. So meaningful product testing is important to companies of all stages and sizes, and we’re proud to partner with

  • Major brands including Nestle, P&G, Estee Lauder, Georgia Pacific, Hanes, CVS, and Target.
  • We also work with some growth stage brands like Sakara, Harry’s, and Bombas
  • And smaller brands like Lemmelive, Love Corn, Cabinet, and Starday Foods.

You’ll notice that these span categories – we do taste testing for food and bev, wear testing for apparel, competitive testing across SKUs for retailers, and more. We really aim to democratize access to this data for brands of all shapes and sizes,and are after the $24bn spent annually by consumer product companies, here in the US, on Data & Analytics today.

What’s your business model?

Highlight operates on a usage-based model that allows customers to flexibly buy and use credits according to their usage levels and volume expectations.

How are you preparing for a potential economic slowdown?

Fortunately for us, we are in an industry that doesn’t stop in times of slowdown – knowing your consumer and testing your products is a must-have no matter the economic environment. As an organization, we are relentlessly focused on continuing to drive value for our users who use Highlight’s data to protect their core businesses – so they are building and maintaining durable products that thrive even in difficult economic times. Additionally, from an ROI perspective, Highlight is a value product, so we continue to ensure cost-benefit for our customers is a no-brainer.

What was the funding process like?

Highlight was very intentional with the decision to fundraise and what additional capital would yield in terms of creating enterprise value and hitting key milestones as an organization. With that intentionality, and the drive to partner with hands-on, values-aligned investors, our leadership team was very thoughtful in conversations and focused on ensuring a positive outcome not just fiscally, but in terms of team and partners.

What are the biggest challenges that you faced while raising capital?

COVID-19 changed the way in which we fundraise, making the default for ‘getting to know you’ calls remote and over Zoom, rather than in-person. We were intentional about finding ways to meet our investors in person given the importance we placed on having transparent, genuine conversations and real relationships with our investors, despite folks being based all over.

What factors about your business led your investors to write the check?

“There is so much conjecture and imposition of opinion in our world today, and there’s power in leveraging true data from real people to create better, enduring products. It’s empowering to build from truth, and Highlight’s mission and platform enable brands of all sizes and categories to be proactive in creating meaningful product advantages.” –Lucas Mann, Acre Venture Partners

“We believe in making change. We believe in driving meaningful impact grounded by data and intentionality. And that’s exactly what Highlight does. We’re immensely impressed by their results to date and excited to be a part of their journey.” –Lucas Mann, Acre Venture Partners

“We are proud to be an early and continuing investor in Highlight…We over-index on founder-fit and loved Dana and Ethan from the start…we appreciate the opportunity to leverage technology and automate an age-old practice. Traction to-date proves that there’s a real need in the industry…and we have all the confidence in the company’s continued success” – Beth Devin, Hearst Lab

What are the milestones you plan to achieve in the next six months?

  • Accelerate our product roadmap + expand our reach.

As our customers test more products, Highlight becomes a system of record for their owned and benchmarked product data. We’re focused on building tools that capitalize on that data. With the addition of templates and wizards, expert-led testing best practices across verticals, and a truly DIY experience, we’ll continue to make critical product data more powerful and accessible to teams of all sizes.

  • Raise the bar for the Highlighter community experience.

We pride ourselves on the strength and engagement of our community of Highlighters, who are passionate about giving feedback to ensure brands can build better products.

We’re working to expand this community and enhance their user experience to ensure it’s even more seamless and engaging.

  • Grow the Highlight team.

We began expanding our team this year and continue to seek passionate individuals who share our vision for building better products. We’re hiring! Check out our Careers page for open roles.

What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?

As is the advice across much of the early-stage ecosystem in this time: continue to focus on business efficiency – not just relentless topline growth – to ensure the core business is solid and your unit economics are strong enough to allow you to have control of your financials and runway.

As is the advice across much of the early-stage ecosystem in this time: continue to focus on business efficiency – not just relentless topline growth – to ensure the core business is solid and your unit economics are strong enough to allow you to have control of your financials and runway.

Where do you see the company going now over the near term?

Highlight is on a mission to build better products for people and the planet. In order to impact real change, we are building an incredible product intelligence platform to give product developers and marketers the tools and data they need to succeed. Starting by making in-home usage testing easier, faster, and more collaborative, Highlight is continuing to evolve the definition of product intelligence.

What’s your favorite summer destination in and around the city?

Our Highlight team loves South Soho Bar, and La Compagnie des Vins Surnaturels is a personal favorite. We’re both lucky to have family in Connecticut and New Jersey, and love exploring the whole NY area.

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