Anyone who has purchased a pair of eyeglasses knows how difficult it can be to find one that’s affordable—but still high-quality. You could search for a while without getting a pair that fits your budget. That’s where the co-founders of Warby Parker found their inspiration: frustration over expensive eyewear.
The four co-founders of Warby Parker didn’t take the most traditional route to building a business. They kept their backup plans intact and continued college, unlike many other famed entrepreneurs. However, their somewhat predictable fundraising history and continuous growth seem to point the way to an eventual Warby Parker IPO.
It’s not a sure thing at this point, but reputable sources have discussed a possible Warby Parker IPO date. The brand, which provides more affordable glasses and contacts you can order right from your own home, is said to be considering going public as soon as 2021. Should you try to get in on a 2021 Warby Parker IPO? Let’s talk about some of the opportunities and risk behind this company in the event they decide to go public.
TL;DR
- Warby Parker was founded in 2010 by four students at University of Pennsylvania’s Wharton School.
- The company aims to offer high-quality, attractive prescription eyewear at lower prices than other eyewear companies.
- Warby Parker changed the industry by designing glasses in-house and communicating directly with the consumer, helping to minimize customer costs.
- Warby Parker’s business model stands out because they provide 5 free frames sent to your home to try on at no cost before buying.
- Leaders of Warby Parker are focused on building a vibrant corporate community that serves its customers with excellence.
- Total fundraising for Warby Parker is $535.5 million, with a combined Series F and Series G in 2020 that brought the company’s valuation to $3 billion.
- You can view the Warby Parker S-1 here.
Warby Parker has made a name for itself throughout its company history
The organizational psychologist and best-selling author and speaker Adam Grant has famously used Warby Parker as an illustration in his books and a popular Ted Talk. Grant has often mentioned the fledgling company as one of the major financial mistakes he owns up to, as the students at the Wharton School offered him an opportunity to invest early in the company.
Grant explained that he didn’t think the founders were committed enough to the concept, due to the fact that they maintained so-called “safety nets” while building the company. Instead of quitting college to go all-in, they stayed in school. They continued networking and keeping their options open in case of the startup failing.
Building safety nets and proceeding gradually provided these new business leaders the freedom and time to complete each step of growth with care. (Case in point: they spent about six months testing out potential company names for the perfect balance of sophistication and uniqueness.)
The company figured out that offering free home try-ons of glasses frames helped ease any concerns about buying online. After working with fashion designers and suppliers, they were able to develop a line of coveted frames.
The company CEOs, Neil Blumenthal and David Gilboa, say they believe in vision for all. That’s why most purchases have triggered a donation of a pair of glasses to someone in need. But Warby Parker made a pivot during COVID-19 pandemic, instead donating PPE (personal protective equipment) to essential workers.
Warby Parker fundraising rounds to know about
Warby Parker fundraising totals $535.5 million raised over 9 rounds since 2010, as shown by Crunchbase data. Here’s a rundown of how the company has been funded over the years:
- Debt Financing: In October 2010, $500,000 in initial debt financing got the company off the ground.
- Seed Round: In July 2011, Warby Parker held a $1.5 million seed round.
- Series A: Tiger Global Management led the company’s Series A funding round in September 2011. Tiger Global and eight other investors contributed $12 million.
- Series B: General Catalyst led a larger Series B round in September 2012, bringing in an additional $41.5 million for Warby Parker.
- Series C: In December 2013, Tiger Global led a $60 million Series C investment.
- Series D: Warby Parker raised another $100 million in a Series D fundraising round. T. Rowe Price led five other investors in this round, completed in April 2015. This particular funding round was significant in that it carried Warby Parker to a $1.2 billion valuation mark, officially making the brand a unicorn startup.
- Series E: In May 2018, T. Rowe Price was the sole investor in Warby Parker’s $75 million Series E funding round. The pre-money valuation was $1.7 billion.
- Series F: 2020 brought two major funding rounds to Warby Parker. First, in April of 2020, its $125 million Series F round was led by Durable Capital Partners.
- Series G: In August 2020, D1 Capital Partners led a Series G round that brought in $120 million. At the time, Warby Parker had a pre-money valuation of $2.9 billion.
Path to the Warby Parker IPO
Warby Parker began, as many startups do, with a problem that one of the founders wanted to solve for himself. Finding himself missing his prescription glasses and deterred by the astronomical prices of traditional eyewear, he lived without being able to see properly for a full grad school semester.
The idea that many others might be going without this essential piece of equipment for their health prompted the four co-founders to create a solution. They brainstormed, sought funding, and gradually built up Warby Parker into a respected (yet affordable) eyewear brand. They launched their first website in February 2010. It was a resounding success and the company reached their annual sales goal in just three weeks.
Neil Blumenthal, Andrew Hunt, David Gilboa, and Jeffrey Raider are the original four co-founders, and both Blumenthal and Gilboa now serve as co-CEOs of Warby Parker. In 2017, the company reached profitability on an EBITDA basis.
Related: What is EBITDA?
The company now has nearly 2,500 employees and 126 stores (plus, they launched 16 new collections in 2020). Through their Buy A Pair, Give A Pair program, they have distributed more than eight million pairs of glasses in over 50 countries through a partnership with VisionSpring.
Warby Parker’s continuous funding over the past eleven years seems to indicate a general intention to eventually take the company public. However, company leadership isn’t yet prepared to make a public announcement of an official IPO.
“We’ll continue to make strategic decisions in line with our commitment to sustainable growth,” noted a spokesperson for Warby Parker last month.
When is the Warby Parker IPO date?
Unfortunately, unless you’re privy to the extreme inner circle of the company, you probably won’t have the answer to that question for some time. Company leaders are keeping their next steps under wraps, although Bloomberg appeared to have a very minimal idea last month that a 2021 Warby Parker IPO may be part of their vision.
Investors can find risk and opportunity in a Warby Parker IPO
Certainly, investors may wish to take a page from Adam Grant’s book—literally—and consider putting their own money into Warby Parker. As the author and professor has noted, it continues to be a big financial regret. But is investing in the Warby Parker IPO a safe bet for you?
One thing Warby Parker has going for it is its guiding principle—more affordable glasses to help the world see, which fulfills a basic human need. Vision is key to health and success in work and in life. The company points out that nearly one billion people globally don’t have access to eyeglasses.
People may be drawn to Warby Parker because the brand’s affordability helps make it easier for humans to achieve vision health. Other core values include positive treatment of customers and employees, serving the local community, promoting racial equity, and maintaining environmental integrity. (The company says it’s one of the only carbon-neutral eyewear brands in the world!)
As a direct-to-consumer (DTC) company, Warby Parker may face unique challenges on Wall Street. The online mattress retailer Casper had a disappointing February 2020 IPO, slashing its valuation by half to just $470 million.
Allbirds, a DTC footwear company, is currently preparing for an IPO as well. Taleeb Noormohamed, CEO of the online deals marketplace Jane, noted that an IPO for Allbirds could negatively impact the company.
“Once public, you’re now beholden to shareholders…that can change materially how a company operates,” said Noormohamed.
Warby Parker may differ greatly from both of these DTC brand IPOs. However, it’s worth noting that if public market investors aren’t impressed by other DTC offerings, that may bode poorly for its potential.
Bottom line
Warby Parker has been fulfilling its corporate vision of bringing quality eyewear to customers without luxury prices for more than a decade. They seem to be right on the cusp of a Warby Parker IPO date announcement, but it remains to be seen whether or not the executive leadership will select that route.
Certainly, as the startup looks to its future, a Warby Parker IPO in 2021 could be the best way forward. Interested investors will want to keep their nose to the ground on this one.