Atlas Venture bets that craftsmanship is coming back, with $18 million round for CustomMade

By Scott Kirsner, Globe Columnist

Atlas Venture is making its first investment out of a new $265 million investment fund that it raised earlier this year. And there are at least three things that are notable about the deal:

• It's a bet on old-school, Yankee-style craftsmanship.

• It's in a startup, CustomMade, that is located not quite two blocks from Atlas' office in East Cambridge.

• While Atlas usually makes early seed or first-round investments in companies, this is a second round of funding for CustomMade. (The company had raised $8 million previously, from investors including Google Ventures, NextView Ventures, Launch Capital, and First Round Capital.)

CustomMade is a marketplace site somewhat similar to Etsy, but focused entirely on products that are made to order. The site helps customers communicate with a number of "makers" around the country, find one they like, and manage the design process. The two most popular items that customers want made, according to CEO Mike Salguero: tables and necklaces. (I profiled the company and some of the challenges it faced in generating enough work for makers, in 2011.)

Salguero says that CustomMade has 40 employees, and that "the majority of this money will be used for hiring," primarily in engineering and marketing. Over 12,000 makers bid on jobs through the site, and CustomMade pockets 10 percent of every successful transaction (with a cap of $1000 on the company's fee.)

"Our next challenge," says Salguero, "is getting average customers to experience custom for the first time — making it easier, more predictable, and more delightful. And that obviously is something that involves everyone here, from marketing to service to user experience and engineering." (In the photo, Salguero is on the right, with president Seth Rosen on the left.)

In a blog post about the deal, Atlas Venture partner Fred Destin predicts that "custom is the new frontier in luxury and 'affordable luxury.' There is a huge pull away from mindless consumption towards more meaningful, one-off purchases."

The company brought on a new SVP of engineering last December, Jim Haughwout, and a new VP of product starts next month. Maggie McCanner joins CustomMade after working at Amazon.com and AllRecipes.com in Seattle. "We're now importing people to Boston from other places," says Salguero.