HOW WARBY PARKER GOT ITS START
Lucinda here, for the last time this week. Polina returns tomorrow!
Fortune’s Dinah Eng spoke with Dave Gilboa and Neil Blumenthal, the cofounders and co-CEOs of Warby Parker—the eyewear company that disrupted the industry by drastically lowering prices for stylish frames—about how they got their start. It now operates more than 90 physical stores in the U.S. and Canada and is reportedly valued at $1.7 billion.
Here’s an excerpt:
Gilboa: In the summer of 2008, before starting school, I took a few months to backpack around the world and lost my glasses on a plane. I went most of the first semester without glasses because I was shocked at the cost. I could buy a new phone for $200, but a pair of [designer] glasses cost $700. I started complaining to anyone who’d listen that I couldn’t believe glasses were so expensive.
Blumenthal: Andy asked, why aren’t people buying glasses online? I knew the margins were big and knew where we could get glasses produced.
Gilboa: So we agreed to meet at a local bar one night to kick around ideas, and when we got home at 2 a.m., one of us sent out a three-page email about the business idea. The rest of us responded and were really excited from the get-go.
Blumenthal: The biggest challenges were how could we move fast enough, thoughtfully enough, and balance our priorities. For a fashion accessory and health care product, we wanted to have a quality product and a brand that would influence culture.
Gilboa: Each of us took the lead on something. I took point on building the website, setting up our supply chain, hiring our first employee, setting up a phone system, and the customer service system.
Blumenthal: I worked on branding, looking at our values and mission. We spent a lot of time getting feedback from customers and focus groups. We wanted to understand the business model of Luxottica [the 800-pound gorilla of the eyewear industry] and the large optical retailers. We were scared and awed. But we knew we could lower the cost of a pair of glasses from $500 to $99.
Gilboa: The four of us each put in $30,000, so that we’d have equal stakes. We launched in February 2010 while we were still in school. The process of starting a business was all-consuming. I had to drop my second degree program.
Blumenthal: We thought that we’d have to beg friends and families to buy glasses from us.
Gilboa: We spent all our money on getting the website built and the initial inventory. We hired a fashion publicist because we knew we needed to get into established publications to develop credibility and relationships. We ended up getting articles in GQ and Vogue, and social media picked us up.
Read the full interview here.
SoFi, the personal loan unicorn, raised $500 million in a round led the round by the Qatar Investment Authority, valuing the firm at $4.3 billion.
“We strongly believe in SoFi’s approach, and their dedication to build a transformational financial platform that is rapidly disrupting consumer finance,” said Mansoor Al-Mahmoud, CEO of QIA. “SoFi’s team have a clear long-term vision for their business, and we’re proud to be their partners and to support them on their journey as part of our broader strategic investments in technology.”
SoFi meanwhile is backed by Softbank, whose largest backer is Saudi Arabia.
On the political stage, Saudi Arabia and Qatar aren’t exactly friendly. Saudi Arabia, Bahrain, the United Arab Emirates, Egypt among others blockaded Qatar via both land and sea starting in 2017. The countries claimed that Qatar supported terrorism and argued that its relations with Iran were a little too close for comfort.
Qatar though has been invited to talks about rising tensions with Iran—making it the first time that a Qatari jet hits Saudi soil since June 2017.
Fun fact: The Qatar Investment Authority also invested in Uber in 2014, per PitchBook—a company that Saudi Arabia and Softbank currently have a stake in—but has since exited the investment.
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