Gumroad is a platform that enables creators to sell products directly to consumers. Designer Sahil Lavingia founded the company in 2011 with the intention of making selling as easy as social sharing. The company has received more than $8 million in funding.
Creators of all types, such as authors, comedians, designers, filmmakers, musicians, and software developers, use Gumroad to sell products directly to consumers, mostly digital content like albums, comics, ebooks, films, games, music, or tutorials. Gumroad is built as a plug-and-play product that offers payment processing, file hosting and delivery, marketing and communications tools, and consumption experiences for a diverse array of verticals. Lavingia has stated that his product philosophy is to ask what creators spend their time on making things, and then build features for Gumroad that do those above-mentioned logistics functions for them.
Gumroad’s model is notable for the decentralized nature of its marketplace, placing the product emphasis on the relationship between the creator and consumer, instead of discovery. It is also notable for having a substantially lower fee than other commerce platforms (5% + 25¢).
Sahil Lavingia built the first iteration of Gumroad in a single weekend, in 2011. Lavingia, previously the first designer hired at Pinterest and the designer of the Turntable.fm app, was 19 years old at the time.
The idea came to Lavingia when he wanted to sell a photorealistic icon he’d created and realized that the amount of effort - even for an engineer and designer with a deep technical skill set - it took to sell an item directly to consumers was considerable. He decided to build a product that would make selling digital content as easy as sharing it.
In February 2012, while still the sole member of the company, Lavingia announced a $1.1 million seed round from a notable group of investors including Accel Partners, Chris Sacca, Max Levchin, SV Angel, Josh Kopelman, Seth Goldstein, Naval Ravikant, Collaborative Fund, and Danny Rimer.
Several months later in May 2012, it was announced that Kleiner Perkins Caufield & Byers had led a $7 million Series A round for Gumroad. The investment was the first made by former Twitter engineering head Michael Abbott as a KPCB partner.
Notable projects and creators
Magnolia Pictures distributes a curated selection of films via Gumroad. Landmark Theatres also curates a selection of films distributed via Gumroad, including Jiro Dreams of Sushi, Man on Wire, Gonzo, Page One: Inside the New York Times, and Jesus Camp.
Publishing is one of the company’s largest verticals, with best-selling authors like Tim Ferriss, Chris Guillebeau, and John Green counted as fans or sellers. Gumroad has been adopted by many comic book authors as a preferred platform for direct distribution.
In 2014, Wired featured a profile on illustrator Kyle Webster who made more than $100k selling custom Photoshop brushes via Gumroad. Also in 2014, Kiwi Juice was founded by a community of artists to curate the professional art tutorials sold via Gumroad in one place.
Since its inception, Gumroad has raised more than $8.1 million in two separate rounds. In February 2012, there was a seed round of $1.1 million from investors Accel Partners, Chris Sacca, Max Levchin, SV Angel, Josh Kopelman, Seth Goldstein, Naval Ravikant, Collaborative Fund, and Danny Rimer. In May 2012, a $7 million Series A round was led by Kleiner Perkins Caufield & Byers.