Literati Raises $12M to Grow Its Subscription Service for Children’s Books

by Tatum Hunter
October 23, 2019
Literati Austin funding hiring
photo via Aleksandra Gajdeczka

Kids ages 8 to 18 spend an average of 7 hours a day looking at screens.

This fact sparks a spectrum of reactions from parents, from funny send-ups to bitter debates. And while there still isn’t much quality research on the effects of screen time on kids, the pervasiveness of screens puts a lot of people on edge. Part of that unease comes from the opportunity cost of screen-time, or the educational activities kids miss out on when they’re staring at their phones. 

I’m talking about those paper things with the stories and the flippy pages.

Books have been proven to improve educational outcomes for kids. Kids who grow up in a house with 20 books complete three more years of schooling on average than children who don’t. Those results hold up even when controlling for parental education, occupation and income.

That’s the context for Austin startup Literati, a subscription book service that mails books to families monthly.

The company announced today a $12 million Series A round, led by Nikhil Basu Trivedi at Shasta Ventures. Additional participation came from Dick Costolo at 01 Advisors, Katie Jacobs Stanton and Jessica Verilli at #Angels, Dan Graham at Springdale Ventures, Kevin Hartz, Thomas Lehrman, Allan Hubbard, Founders Fund, Silverton Partners and Brent Montgomery at Wheelhouse.

“Parents who make reading fun, and an adventure, and who take a lot of pleasure in reading with their kids, tend to see kids who really, really, really love books,” Literati CEO Jessica Ewing told Built In. “We’re trying to provide a fun, analog experience where people can discover books and reading and kind of get off their devices.”

Ewing founded Literati with co-founder and creative director Kelly Caroll in 2016. Despite the company’s analog focus, Literati’s service is a big technological and logistical undertaking, Ewing said. 

Literati offers five “clubs,” or age groups, for children ages zero through 12. For $9.95 a month per child, the company, which handles all its own fulfillment, sends a package with five age-appropriate books curated around a theme, like science or friendship. The package also contains an original illustration from a featured artist, along with small, thematic toys and stickers. 

Families get a week to read the books, then they can return what they’re done with and buy the books they’d like to keep at Amazon’s listing price. Ewing said families keep about three out of five books. Each package comes with a return shipping label and materials to make it easier to send books back. (Families are charged for books they forget to return, but extensions appear to be an option.)

Literati funding hiring Austin
photo via Aleksandra Gajdeczka

Research indicates family income is one of the biggest determinants of children’s reading proficiency. According to Ewing, Literati’s data shows its customers come from varied income levels. The company also donates unclaimed books to shelters, foster care services and underserved youth programs and allows its customers to send in extra books for donation. It’s given away 18,000 books so far this year.

“It gives people of all income levels the chance to introduce their child to the best in children’s literature,” Ewing said. “One thing that does unite our customers is the emphasis on education. That’s a huge thing we see over and over again.”

Literati has seen tenfold growth in the last 18 months. In light of the new funding, it plans to significantly grow its current team of 40, with particular focus on engineering, marketing and design roles. Ewing declined to share specific hiring projections.

“One of the reasons we love being in Austin is this product is really a marriage of the three things this city is about, and that’s education, technology and the arts. And we seek to blend all of these things in our company,” she said. “We’re proud to represent the city with this raise.”

 

Literati funding hiring Austin
photo via Aleksandra Gajdeczka

 

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