After its launch in 2010, Gemvara made a name for itself as a website selling jewelry. On it, a shopper can customize a pendant or ring in their choice of precious metals with, say, their birthstone. It's also a startup that's gained some notoriety in the small-business community as an innovative company with an ultra-young founder--Matt Lauzon, who was 22 when he started working on the ideas behind Gemvara, and who was named an Inc. 30 Under 30 honoree in 2011.
All of this helped it attract a lot of venture-capital investment--roughly $60 million in total--especially for a company in such a . . . let's say classic industry.
But not everything has been rosy in recent years. Lauzon, who created the business as a student at Babson College, stepped away from its helm in 2012. His recruit, Janet Holian, took the helm. But she lasted less than a year as CEO.
Two veteran finance-guys with strong management pedigrees stepped in, and today the company is run by CEO Matt Nichols and President Jon Blotner. Nichols is a former Google executive and venture capitalist, and Blotner was formerly at Bain & Company. Together they are cranking the steering wheel a different direction--one that entails opening up new lines of business, and, they exclusively told Inc., that today they are launching a new site, called Sequel.
As they tell it, the experiment started about a year ago, when, in late 2014, when they noticed the website and company reps were fielding requests from customers for something new: Individuals--the same ones who'd been customizing a "Flamenco Ring" with an emerald and 14-karat gold for $1,715, or a pair of black-diamond stud earrings in silver for $210--wanted use Gemvara's customization services for gemstones they already owned. They wanted to send in their old jewelry to Gemvara, for a refresh; to have an old stone reset into a new, stylish, piece of jewelry.
The pair responded, and by early summer, they launched StoneReset.com. And with that, a few customers a day were trusting Gemvara enough to put their family heirloom in the mail, let the company's jewelers dissect it and create a new ring or pendant from the original precious stone.
"I was actually one of our first customers with my wife's engagement ring," Nichols said, of the ring with which he proposed to his wife 13 years ago, and which he promised her she could have re-worked into a more modern ring anytime. That, Nichols said, was never a convenient, or simple task. "It took me 13 years to reset the ring. I finally did it."
His wife loved it. So did 33,000 other people, who saw the transformation in a post on Pinterest.
"We had such a massive response on Pinterest," Nichols said, "we realized this is in the back of a lot of people's minds."
The pair also explains the demand as a generational progression: The grandparents of Americans getting engaged these days were in the first generation to use somewhat modern diamond-centric rings for the purpose. Those gemstones haven't deteriorated--what's that line about diamonds?--and families still treasure them. But the rings they've been mounted in may not fit, or might just not fit the current owner's personal style.
The existing fine-jewelry sales companies aren't equipped to serve this demand, Gemvara executives say. Their profits are based largely on sales of gemstones--the settings are not enough for them to deal in, and providing a resetting service is labor-intensive, and rarely worthwhile.
Enter Gemvara, which already had a robust infrastructure of in-house and on-contract jewelry craftsmen, who have already created more than 100,000 rings for traditional Gemvara customers.
"From the moment the stone comes out of a ring, it is the exact same process as creating a Gemvara ring," Blotner says. "Because we have that customization engine, we can scale this almost immediately."
And it's working, the company says. The site has grown 300 percent in requests for jewelry-shipping kits for new customers since June, according to Gemvara management. Six months in, StoneReset is getting a real brand name--Sequel--to move beyond the simple domain name that describes its service and that's search-engine friendly.
"This is a massive rethinking of fine jewelry," Blotner said, who points out that there is $65 billion in fine jewelry sold each year--and a lot of that is sitting, unworn, in women's jewelry boxes, because it's out of style. "And we realized we were the only ones who could do it."
Not only that, according to the company, this part of the business is on track to be a $10 million revenue stream by the end of the year. And that's particularly exciting, considering all of Gemvara made $15 million last year.
Dare we say it? Meet Gemvara, the Sequel.
Listen to Christine Lagorio-Chafkin and Will Yakowicz discuss the next generation of fine-jewelry buyers--and the companies that are targeting them--on the Inc. Uncensored podcast: