Warby Parker's Vision for Growth
Warby Parker has been a revolutionary force in the eyewear market since its launch in February 2010. By selling their own designs almost exclusively online, Warby Parker is able to price its hip, affordable eyewear at $95 per pair.
The company is currently in growth mode. It introduced prescription sunglasses this spring, and plans to offer progressive lenses soon.
While it is not yet profitable, the co-founders have raised $13.5 million in venture capital. Warby Parker’s investors include Tiger Global, the Menlo Talent Fund, Lerer Ventures, Thrive Capital and First Round Capital and high-profile angel investors like Joel Horowitz, former CEO of Tommy Hilfiger; Ashton Kutcher; Lady Gaga’s manager, Troy Carter; and Ari Emanuel, CEO of talent agency William Morris Endeavor.
Philanthropy is a hallmark of this certified B-Corporation, raising its cool quotient with Millennials. For every pair of glasses Warby Parker sells, it distributes another pair to a person in need through a collaboration with non-profit VisionSpring.
Co-founder and co-CEO Neil Blumenthal spoke about the company’s vision for growth and the potential for a future IPO.
What are some of the biggest challenges currently facing Warby Parker as it looks to expand?
The biggest challenges revolve around hiring, just finding enough top tier candidates. There seems to be a mismatch between the skills that we need to grow as a company and skills available in the marketplace, particularly for engineering and web developers and programmers. There’s a massive shortage. Every start up and mid-stage company that I know can’t [find] web developers. Warby Parker currently has 70 employees, and our plan is to hire at least one person a week through the end of the year. We are behind on that goal due to the lack of talent in the marketplace.
Where are you experiencing the most growth?
One of the biggest drivers of growth is our existing customer base and more than half of our new customers are being referred by existing customers. The bulk of our existing customer base is on the coasts, tend to live in cities and tend to be fashion forward and tech savvy.
You are broadening your demographic later this year when you plan to launch progressive lenses. How are you planning to attract new customers?
We already have a decent customer base that are progressive candidates who buy our frames without the lenses . We are planning to reach out to those customers when we launch and we will also have plans in place in terms of more traditional advertising as well.
Are you hitting your sales targets for this year so far?
We are ahead of target and had very aggressive growth plans at the start of the year.
Are you looking to grow internationally?
Currently, we only ship internationally to Canada. We are planning to ship to the UK soon. We see great opportunity for expansion outside the US.
You launched prescription sunglasses in April. How is that going?
Sunglass sales have been through the roof, which is one of the reasons why we are ahead of our sales targets. We have found that there is a generation of consumers in their 20s and 30s that has never purchased prescription sunglasses before because they traditionally were prohibitively expensive.
Any plans to roll out a mobile app?
Yes, definitely. Our mobile site will open in a few weeks. We see high open rates of our emails on people’s mobile phones. [Still] we foresee that most people are still going to use their laptop or tablet to make a purchase because people will want to see our glasses in a larger format.
How important is social media to your business model?
It’s a very important tool for both acquiring new customers and for retaining them. Our Pinterest traffic has quadrupled over past few months. Facebook has also contributed to the success of our home try-on program because we saw our customers start to post pictures of themselves wearing our glasses on Facebook and asking their friends to comment on the glasses they were deciding to purchase.
You’ve turned away Silicon Valley firms such as New Enterprise Associates, Sequoia Capital and Greylock Partners from investing in Warby Parker. What is your selection process for investors?
We are looking for folks that really understand and are excited by the vision of the company and who are going to find ways to add value and achieve those goals, as opposed to investors who want to extract the value of our best practices to share with other portfolio companies or to get data to report back to LPs. SV Angel has been helpful in making introductions. The hedge fund Tiger Global is our largest investor and assisted with hiring a consultant with expertise to help us with our supply chain process. First Round Capital was one of our early investors and is one of the few venture capital funds that has full-time staff dedicated to community management. They seem to recognize that entrepreneurs will add more value to each other if they can interact and have an online platform in which company founders can ask questions of each other.
SecondMarket has helped fuel the tech boom and has been a driving force in valuing hot startups. You are a currently considered a darling of SecondMarket. Do you feel pressure to accelerate your timeline for going public based on that?
We do not feel pressure to go public based on SecondMarket. We handpicked the investors that we have because they align with our objectives, which is to create a 100-year company. We are not managing the business on a monthly basis just to hit quick targets to flip the company. We are trying to build a sustainable company that makes people happy. In the long run, we are looking to build a profitable business.