Squinting to see if it's an E... Eff, it's a Series F. Warby Parker raised $245M from two Series of funding rounds. The direct-to-consumer glasses pioneer is now reportedly valued at $3B (#tricorn). 10 years ago, Warby revolutionized the glasses game by selling affordable prescription glasses online.
- Profit-in-focus: For decades, designer glasses have had ridiculously high profit margins. Say a frame costs $20 to make — eyewear giant Luxottica might sell it for $250. Oh and BTW - there's an extra $200 for certain prescription lenses (total = $450).
- Consumer-in-focus: Warby ditched the price-inflating middleman. It cut costs by going D2C (fewer middlemen take profits) and designing glasses in-house (don't have to pay Armani). It passed savings to consumers, offering frames and lenses for a combined price of $95.
I can see clearly now... Besides affordability, Warby's success comes from 3 factors:
- D2C customer service: Free home try-on of 5 pairs, virtual AR try-ons, 30-day free returns, and online visits with specialists to extend prescriptions.
- Experiential retail: Warby's 125 sleek stores look like the retail versions of a Wes Anderson movie. Barista-like employees approach to say that “Valencia tortoiseshell frames your face perfectly.”
- Millennial-friendliness: Warby's cutely-packaged glasses have vaguely endearing names like “Percey,” “Watts,” and “Wilkie." It's also a socially-conscious brand, with charitable initiatives like “Buy A Pair, Give a Pair.”
Warby's biz model could thrive in any economic climate... It sells products that are consistently in demand (eyeglasses, sunglasses, and contacts). In a recession, Warby can win with its affordable offering for a necessity: Helping you see. In a pandemic/lockdown, Warby can thrive with its strong online model. In normal times, Warby's physical retail experiences attract people who prefer in-store shopping.
FYI: On today's Snacks Daily podcast, we chat about why we think Apple should buy Warby Parker.