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
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.
VENTURE DEALS
• Kurly, a South Korean grocery delivery service, raised $113 million in Series D funding. Sequoia China led the round, and was joined by investors including Hillhouse Capital. Read more.
• Dashlane, a New York-based digital identity firm, raised $110 million in Series D funding. Sequoia led the round.
• Thrive Earlier Detection Corp., a Cambridge, Mass.-based firm focused on earlier cancer detection into routine medical care, raised $110 million in a Series A funding. Third Rock Ventures led the round, and was joined by investors including Section 32, Casdin Capital, Biomatics Capital, BlueCross BlueShield Venture Partners, Invus, Exact Sciences and others.
• Logz.io, a Boston and Tel Aviv-based AI analytics platform raised $52 million in Series D funding. General Catalyst led the round, and was joined by investors including OpenView Ventures, 83North, Giza Venture Capital, Vintage Investment Partners, Greenspring Associates, and Next47.
• Vesper Medical Inc, a Wayne, Penn.-based developer of medical devices for minimally invasive peripheral vascular procedures, raised $37 million in funding. Vensana Capital and Gilde led the round, and was joined by investors including New Enterprise Associates and Quaker Partners.
• Sitetracker, a Palo Alto-based project, asset, and work management platform, extended Series B financing to $34 million. New investors include Energize Ventures. Sitetracker previously closed their Series B round in August led by New Enterprise Associates.
• Intact Vascular Inc, a Wayne, Penn.-based developer of medical devices for minimally invasive peripheral vascular procedures, raised $25 million funding Vensana Capital led the round and was joined by investors including New Enterprise Associates, H.I.G. BioHealth Partners and Quaker Partners.
• OwnBackup, cloud-to-cloud backup and recovery vendor, raised $23.3 million in Series C funding. Insight Venture Partners and Vertex Ventures led the round, and was joined by investors including Innovation Endeavors, Oryzn Capital, and Salesforce Ventures.
• Riffyn, an Oakland, Calif.-based provider of SaaS services for scientific process design and data analytics, raised $15 million in Series B funding. M Ventures led the round, and was joined by investors including Waters Corporation, O’Reilly AlphaTech Ventures, and Plug and Play Ventures.
• BigTime Software, a Chicago-based cloud-based software for professional services firms, raised $14 million in funding. Wavecrest Growth Partners led the round, and was joined by investors including MassMutual Ventures and Migration Capital.
• TMRW, a New York-based Robotic Process Automation (RPA) platform maker designed specifically for in vitro fertilization (IVF), raised over $12M in Series A funding. Special Situations’ Life Sciences Innovation (LSI) Fund led the round.
• Mightier, a Boston-based platform for games used to regulate emotions, raised $6.6 million in Series A funding. Foxkiser led the round, and was joined by investors including Asset Management Ventures, FundRx and existing investors including Founder Collective, Slow Ventures and Project 11.
• ID R&D, a New York-based AI-based voice and behavioral biometrics and voice and face anti-spoofing technologies maker, raised $5.7 million in Series A funding. GSR Ventures led the round, and was joined by investors including Gagarin Capital
• Pillar, a New York-based startup for students to pay off their student loans, raised $5.5 million in seed funding. Kleiner Perkins led the round, and was joined by investors including Rainfall Ventures, Great Oaks VC, Financial Venture Studio, Kairos, and Day One Ventures.
• Yapily, a London-based fintech B2B business, raised $5.4 million from HV Holtzbrinck Ventures, and LocalGlobe.
• CloudApp, a San Francisco-based provider of enterprise driven video solutions, raised $4.3 million in seed funding. Kickstart Seed Fund led the round.
• Backtracks, an Austin-based podcast analytics firm, raised $2.1 million in seed funding. Moonshots Capital led the round, and was joined by investors including Capital Factory, Sputnik ATX, Next Coast Ventures, Bull Creek Capital, and BNSG Capital.
• Amadeus Code, a Tokyo-based AI songwriting assistant, raised 200M JPY (approximately $1.8 million US) in Series A funding. World Innovation Lab led the round.
• VuPulse, a Boca Raton-based marketing platform, raised $1 million in Series A funding. Florida Funders led the round with participation from Bridge Angel Investors.
• Feedtrail, a Raleigh, N.C.-based healthcare technology company, raised $1 million in funding. Dioko Ventures led the round.
PE
• WaveDivision Capital in partnership with Searchlight Capital Partners plan to acquire the Washington, Oregon, Idaho, and Montana-based assets of Frontier Communications Corporation (NASDAQ: FTR) for $1.35 billion.
• Insight Partners acquired Recorded Future, a Boston-based threat intelligence firm, for $780 million.
• Vista Equity Partners will acquire Black Mountain Systems, a San Diego-based provider of workflow software for credit investors and alternative asset managers. Financial terms weren't disclosed.
• Transom Capital Group acquired Pelco Inc, a Fresno, Calif.-based provider of video surveillance solutions, from Schneider Electric. Financial terms weren't disclosed.
• Bain Capital invested in Rodeo Dental & Orthodontics, a Texas-based group practice provider of specialty dental services. Financial terms weren't disclosed.
• Thomas Bravo will take a majority stake in Cority, a Toronto-based provider of environmental, health, safety and quality software. Previous majority investor Norwest Venture Partners will continue to retain a significant stake in the business. Financial terms weren't disclosed.
• ImageFIRST, a portfolio company of Calera Capital, acquired Faultless Linen, a Kansas City-based healthcare linen firm. Financial terms weren't disclosed.
• Sovos, backed by Hq, acquired Foriba, an Istanbul-based e-invoicing, e-delivery notes, e-receipts and periodic value-added tax (VAT) reporting firm. Financial terms weren't disclosed.
• Golden Gate Capital will acquire a 51% equity stake in Ensemble Health Partners, a Huntersville, N.C.-based hospital billing firm, from Bon Secours Mercy Health.
• Crestview Partners acquired Concours Mold Inc., a Windsor, Ontario maker of steel molds and tooling, primarily used in the production of plastic components for the automotive and consumer sectors. Financial terms weren't disclosed.
OTHERS
• WeWork is reportedly seeking a $2.75 billion credit line ahead of IPO, per Bloomberg.
• Pantheon acquired StagingPilot, website update automation maker.
• Palo Alto Networks plans to acquire Twistlock, Portland-based cybersecurity firm, for $410 million and PureSec, a Tel Aviv-based security platform for an undisclosed amount.
IPOS
• Hansoh Pharmaceutical, the Chinese cancer drug seller, aims to raise up to $1 billion in a Hong Kong IPO, the Financial Times reports citing sources. Read more.
• Naspers, plans to float its consumer internet businesses with assets of over 100 billion euros ($112 billion) on the Euronext stock exchange in Amsterdam on July 17, Reuters reports. Read more.
• Linx, a São Paulo, Brazil-based maker of business management solutions for Latin American retailers, filed for an $100 million IPO. Goldman Sachs, Morgan Stanley, Jefferies, BofA Merrill Lynch and Itau BBA. It plans to list on the NYSE as “LINX.” Read more.
• Cambium Networks, a Rolling Meadows, Ill.-based firm for cloud-based wireless broadband network infrastructure, plans to raise $75 million in an IPO. J.P. Morgan and Goldman Sachs are underwriters. It plans to list on the Nasdaq as “CMBM.” Read more.
EXITS
• Bert Miller’s MRI Network Holdings LLC acquired Management Recruiters International, a Philadelphia-based recruiting firm, from CDI Holding Company, a portfolio company of AE Industrial Partners. Financial terms weren't disclosed.
• One Equity Partners sold Anvil International, an Exeter, N.H.-based manufacturer and provider piping system support, to Smith-Cooper International. Financial terms weren't disclosed.
F+FS
• Adams Street Partners closed its inaugural Private Credit program with approximately $1.1 billion.
• East Ventures raised $200 million for its growth fund. Read more.
• Northwestern Mutual designated $150 million to form Northwestern Mutual Future Ventures Fund II.
PEOPLE
• Tom Loverro has been promoted to General Partner at IVP.
• Foundation Capital hired Li Sun, formerly of Bessemer, and Apoorva Pandhi, formerly of Quid, as Partners.
• SV Angel promoted Beth Turner to General Partner.
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