Sunday Sitdown: Blitsy’s Ross Petersen bets big on arts, crafts

Chicago is home to a fast-growing arts and crafts e-commerce company called Blitsy that’s aiming to become the go-to website for adults making their own creations. Blitsy has doubled its revenues every year since its founding in late 2011. Its sibling operators — 34-year-old twin brothers Ross Petersen, the CEO, and chief operating officer Ryan Petersen and their sister Katy Weade, 35, chief creative officer — aspire to take an even bigger revenue jump after recently getting $6.2 million in Series B funding led by German media giant Hubert Burda Media, which is also the largest corporate shareholder in Etsy. Ross Petersen spoke about the company’s ambitious expansion plans with the Chicago Sun-Times’ Sandra Guy. A condensed transcript follows.

Question: What’s the ethos?

Answer: When Ryan and Katy and I were growing up in Glenview, I watched in awe as our dad owned and operated a Chicago grocery store, Petersen Foods, that our grandfather had started. My dad took over the grocery store in the mid-’80s after my grandfather passed away.

Walgreens was interested in buying the property. My dad ended up selling the store to Walgreens and used the proceeds to start a new business to support independent scrapbook retailers.

Watching big-box retailers expand made me realize independent retailers would struggle to survive unless they came up with digital strategies to compete online. In 2008, Ryan, Katy and I developed our first business in hopes of helping independent retailers, developing software meant to help retailers sell online. We sold that business — digital scrapbooking startup ScrapHD — to Michaels Stores in September 2010.

Surprisingly, the largest retailer in our industry wasn’t selling products online at the time, and that frustrated us. Katy and I worked for Michaels in Dallas for two years, then decided to join with Ryan in Chicago to build the company no one else was building. That’s how Blitsy.com was born.

Q: What makes the business challenging?

A: The world continues to consolidate. Michaels just bought Darice label owner Lamrite West. American Crafts has acquired half a dozen brands in two years. Big-box retailers increasingly put their own house brands on the shelves, squeezing space for national brands. And independent retailers must buy new inventory more frequently to keep up with shoppers’ demands.

To help independents and manufacturers compete, we’ve launched products for more than 600 brands and market these and develop online video and other content to support them.

Q: The trends in crafting include Pinterest, Etsy and crafter marketplaces set up by Amazon and eBay. How are you capitalizing on crafting’s renewed popularity?

A: We’ve redesigned our website so it’s easier to search the 100,000-plus items we sell. We’re offering a 100 percent price-match guarantee and expanding into supplies for younger people who may define themselves as do-it-yourselfers.

We produce 40 to 50 video classes a week that include live-streaming and twice-a-week broadcasts.

Arts and crafts is an estimated $30 billion market in North America, and we’ve already sold to customers in over 70 countries.

I think the arts-and-crafts industry is as close to recession-proof as you can get, given that it is affordable and fun, and when you complete a project, you have something to show for it.

Q: You’ve raised $11.6 million in venture financing, not including debt, and you plan to grow to over 100 employees within 18 months, up from 50 office and warehouse employees now in West Town. Any additional goals?

A: Our newest strategic investment partner, Hubert Burda Media, owns Elle Germany, Playboy Germany and distributes one of the largest databases of digital sewing patterns to millions of Burda Style customers throughout Europe. My goal is to grow Blitsy into a huge company with the support of our partners, help other entrepreneurs and make sure we’re creating meaningful jobs in Chicago and throughout the world.

I also want to ensure online shoppers have the choice to shop outside of Amazon and mass merchants.

Q: You live near the office, your brother lives in Lakeview, and your sister recently moved back to Glenview. What do you all do for fun?

A: My wife, Sarah, and I love to take our two dogs and newborn son Max to the Montrose dog beach on weekends. I also play golf and lacrosse whenever I can. Ryan likes to watch sports and frequents Cubs and Blackhawks games. He also spends time with Ranger, our 11-year-old Springer Spaniel and first office dog. Katy spends time with her husband, who we call TR — Tampa Ryan. She also enjoys crafting and loving on her son Miles.