Hustler Words – Onton, the AI-driven shopping platform initially focused on furniture, has announced a successful $7.5 million funding round, signaling its intent to broaden its reach into new product categories. The investment, spearheaded by Footwork and supported by Liquid 2, Parable Ventures, and 43, brings Onton’s total funding to approximately $10 million. This financial boost will fuel the company’s expansion plans, beginning with apparel and eventually extending to consumer electronics.
The move comes as major players like OpenAI, Google, and Amazon increasingly integrate AI into the shopping experience. These tech giants are investing heavily in AI assistants designed to aid consumers in product discovery and selection. Startups such as Perplexity, Daydream, and Cherry are also carving out niches in the AI-powered shopping landscape. Onton, formerly known as Deft, has experienced significant growth, with its monthly active user base surging from 50,000 to over 2 million.
Onton’s co-founder, Zach Hudson, emphasizes the limitations of large language models (LLMs) in e-commerce, noting that while they can predict intent, they haven’t fully addressed the challenges of online shopping. Hudson points out that the average consumer’s purchase decision time has actually increased.
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To overcome these limitations, Onton employs a neuro-symbolic architecture. This approach, according to Hudson, mitigates the "hallucination" issues common in LLMs, resulting in more accurate and logical search results. The AI model can also learn from real-world information that may not be explicitly included in product descriptions.
"Let’s say you are looking for furniture that is pet-friendly. Our tools know that if the item has polyester in it, it would be more stain and scratch-resistant, so it would be more pet-friendly. Our tools learn these things through every single search and become smarter at a faster rate," Hudson explained.
The platform also addresses the issue of inconsistent product naming across different websites. Onton’s AI model considers these variations to provide more comprehensive search results.
Onton offers various input methods and features to assist users in both short-term and long-term decision-making. Users can upload images or provide prompts to generate desired home or office setups, and Onton will find suitable furniture. The platform also provides an infinite canvas with image generation capabilities, allowing users to combine existing images with product suggestions for ideation. Additionally, users can upload images of their rooms and ask the tool to furnish them virtually.
Onton believes that these features offer consumers more flexibility compared to a chat-only approach, enabling them to find what they need even if they struggle to articulate it perfectly. The company reports that its conversion rates are 3-5 times higher than traditional e-commerce sites, attributing this success to the trustworthiness of its underlying data.
Hudson notes that the technological and interface improvements made will facilitate the launch of the apparel category. Onton is currently building its catalog for this vertical and plans to launch it soon, where it will compete with companies like Daydream, Aesthetic, and Style.ai.
Onton has grown from three full-time employees in 2023 to 10 currently, and plans to expand the team to 15 by hiring engineers and researchers.
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