Dave Gilboa and Neil Blumenthal launched their New York City eyeglasses retailer, Warby Parker, back in 2010. Since then, the e-commerce first business has raised nearly $300 million in funding, expanding to more than 1,400 employees and 65 brick-and-mortar stores across the country. But to hear Gilboa tell it, they're just getting started.
"We're still just scratching the surface, with less than 1 percent of the U.S. market share," Gilboa tells Inc. "There's still huge potential in our core market, and we think there's also potential globally."
With an eye toward that potential, the company on Wednesday announced that it had raised $75 million in a Series E funding round, led by the existing investor T. Rowe Price. It's worth noting that the private equity firm has a track record of investing in companies that are nearing a public listing, and while the founders are mum on when an IPO could happen, Gilboa suggests that it is on the horizon. "We have a very long-term vision for what Warby Parker can be and the impact it can have on the world, and we think that the best way to execute on that vision is by being an independent company," he says. The firm also announced that it will generate a profit for the first time this year.
In the interim, Warby Parker plans to use the cash to continue expanding and solve what Gilboa sees as systemic problems for customers. First on the docket: a way for users to seamlessly re-up their glasses prescription, and therefore order a series of new frames from the company over time. As recently as last year, the founders launched a Prescription Check app that lets users download and complete a vision test from home, which a team of remote ophthalmologists can then check and write a prescription for accordingly. Since the debut, "we have dramatically increased the number of states that people can use the service in, and we've seen a strong uptick in volumes," Gilboa notes. The company plans to continue building out the feature, as well as another app that effectively lets customers try on glasses virtually. The feature, called Find Your Fit, is designed to work with the new iPhone 10, taking exact measurements of the customer's face and then recommending frames that are sure to fit.
In the meantime, Warby Parker plans to continue growing its physical presence. Like many e-commerce first companies, analysts suggest that Warby Parker is realizing the limits of tapping customers online, given that some 90 percent of retail still happens in stores, according to Forrester. The company plans on adding 35 retail stores by the end of the year.
Still, and despite the fact that Warby Parker is all but certainly headed for an IPO in the not-too-distant future, challenges remain. "Something that is top of mind for me and Neil [Blumenthal] is how we become a bigger company without slowing down and without becoming bureaucratic," says Gilboa. (Warby Parker does not speak publicly about its revenue, though Inc. estimated that it was on track to book $250 million in 2017.) With more than 1,400 employees--some of whom work more than 3,000 miles away from the company's New York City headquarters--managing workflows and morale can be difficult. "The things that cause a pit in my stomach are people related," Gilboa adds, referring to when employees opt to leave the company, or aren't performing to their potential. To help foster communication, Warby Parker holds weekly all-hands meetings, and a three-to five-minute "highlight reel" showcasing some of the most positive moments of the past few days.
Still, growing to more than 1,400 employees has its upsides from a management perspective. "Having great team members has freed me up to think about the long-term vision of the company," insists Gilboa. That, he hopes, has Warby Parker representing a more than 1 percent slice of the market.