June 24th, 2018 | By: The Startups Team | Tags: Stories
There is one category of consumer tech that’s being built largely outside Silicon Valley: E-commerce. Fab, NastyGal, ShoeDazzle, Birchbox, Bonobos, Honest, Dollar Shave Club, JustFab, Warby Parker and so many other once-hyped (and in a few cases, still-hyped) “e-commerce 2.0” companies were centered in fashion and celebrity hubs of LA and New York.
This interview with Warby Parker co-founder Neil Blumenthal shows that the geographic distinction isn’t just about the weather. It’s about how the company is built. I’ve never before spoken with a Web founder who put more thought into his PR hire than his…. developers.
Warby may wind up out surviving other ecommerce roadkill because they got what they were early: A fashion and lifestyle brand, not a tech company.
Neil Blumenthal: I had been really passionate about foreign policy and global affairs. I thought it was perfect for me. I thought that I could hopefully effect change in the world by maybe joining the State Department, so I took the Foreign Service exam. I’d spent my whole junior year abroad in Buenos Aires and Madrid and just studied international relations and history.
I did some graduate course work in The Netherlands, focused on negotiation and international mediation and conflict resolution under the premise that if we could get people stop killing each other, then we could focus on the big issues like health and education.
I ended up returning to New York. I worked at a think tank that came out with policies to resolve deadly‑conflict wars. I think there I learned what I don’t want to do, and that is come up with policies, work in an office, and then advocate them to higher powers that actually have the ability to implement change. For me, I’m more passionate about actually doing things myself and having direct impact.
The Startups Team: Did you feel a little bit disillusioned once you were like, “Oh, I’m just kind of writing policy that may never get implemented.”? Do you think you were naive in thinking people can stop killing each other and then we can solve real problems?
Neil Blumenthal: I think so. I thought, “Hey, if we recommend what seemingly were sensible solutions.” In this case there were war lords, there were the heads of the GA, member states of the UN. We thought that they would take action and it’s always a lot more complicated than that. If you take a look even a couple levels deeper, you have many more actors that are all motivated by different reasons.
That got me thinking more about social enterprise and problem solving, and really if you want to affect these change what are the best vehicles to do that? That is what got me more and more excited about the private sector and this intersection of business and non‑profit or business and purpose.
A family friend had introduced me to this eye doctor, Jordan Casello, a really dynamic guy who had this idea to train low income women to start their own businesses selling glasses in their communities. I thought, “Wow, this is a powerful idea.” For one, there’s about a billion people on the planet that don’t have access to glasses and that number was just mind boggling.
Who need them, who don’t have access. When you think about that number, why is that the case? It’s been about 800 years since glasses were [invented.]
The Startups Team: It’s not particularly a new technology. Probably more people have access to mobile phones.
Neil Blumenthal: Definitely, today they do. The question is, how do you solve a problem that big? Traditional charity, raise money, give away a bunch of free glasses. That’s not going to solve the problem, because in the hierarchy of needs glasses are pretty low and you’re not going to get those sums of money.
The other thing is that’s it’s not sustainable. What happens when somebody’s prescription changes or they lose or they break their glasses or a whole new cohort of people need glasses?
This idea to actually use glasses as a vehicle for economic development, to actually train individuals to start their own businesses, that made sense to me and the fact that we were focusing on female entrepreneurs, because all these studies had shown that when women in particular have access to capital, they tend to use it on the health and education of the children.
You have this great multiplier effect. I got really excited about that. Jordan offered me this opportunity to move down to El Salvador and pay me a small stipend to live and work on this pilot program to test this idea.
I moved down to El Salvador. The plan was for me to live there for a year. I’d spent six months there when Jordan asked me to come back because we had just gotten some World Bank funding, to then go over to India to start up and program there.
It was just this amazing entrepreneurial experience where there wasn’t really a roadmap, because nobody knew exactly how to distribute glasses in these communities where people are living on less than four dollars a day.
You’d encounter all these strange challenges. Strange is probably the wrong word, but just unanticipated. An example is, I could probably in an hour, train somebody to do a very simple vision screening to determine if somebody needs a simple pair of reading glasses or needs to be referred to an eye doctor for cataract surgery.
We could do this with a bunch of members of the community and then teach them to immediately sell reading glasses and do that in an hour.
What would happen when we did that, is that sometimes the neighbors and the other members of the community would turn to this woman and say, “I’ve known you my whole life. You’ve lived in this hut right next to mine. How on earth do you know to give an eye exam and sell glasses?”
The question is, how do you give somebody credibility? We gave them a lab coat, we branded it, give them an ID badge, a certificate. Certificates are big in the developing world.
Put a bunch of stamps on it, ended up putting banners outside their homes. We call them vision entrepreneurs and vision entrepreneur in training and would put that up for six months.
That’s where I learned a lot about marketing, and building credibility, and influencing. Another interesting anecdote is in the US when you are introducing a product, what’s the first thing that you do? You try to find influencers and people that you think have a ton of credibility in the community.
Often, these are not people that need things because if they’re influencers, they already have a bunch of wealth or status. In the non‑profit world, you always try to make things as difficult as possible, so you go to the neediest first.
If you’re trying to introduce glasses, where nobody in the village is wearing a pair of glasses, if you go to the neediest person first, is that going to actually get the entire community to start wearing the glasses, versus if you go to the equivalent of the pastor, or the priest, or the mayor?
We would start to go to the influencers and actually give them a pair of glasses, help them sponsor campaigns, and then we would be able to sell the glasses to the remainder of the community once it was sort of cool and approved by the most credible people in the community.
The Startups Team: When you came back here, what made you stop doing that kind of work? Obviously, you still cared about these issues, but not really being out there touching the audience, doing things, seeing tangible results.
Neil Blumenthal: I was the second employee [at VisionSpring], and we grew it to about 10 different countries and did that over, about five years. It was super rewarding, but what started to happen was my learning curve started to plateau. The first time, for example, I went to China and visited factories where eyeglasses were made, that was super exciting, but by the eighth time, a little less so.
I decided to go back to business school.
The Startups Team: Why did you feel you needed that? It seems that you’ve got real leadership training in some really intense parts of the world.
Neil Blumenthal: I felt that, as a society and as a business community, we really undervalue non‑profit work and social enterprise work. I hope that is changing, but I didn’t get the sense from people that they valued the work that I had done as much as I knew it had impacted me.
I thought that, going to business school, getting an MBA, especially from a place like Wharton, which is known being really rigorous, especially with respect to finance, would help supplement that and maybe change people’s perspectives of my background.
The Startups Team: When you went in, what was your goal?
Neil Blumenthal: I recently reread my application. You pour your heart out into this application and I’ve done exactly what I said I was going to do, which was start a social enterprise that would hopefully have a broad impact, using business principles and marketing and management acumen, so that was really refreshing.
I will be honest, that first semester, there’s all this pressure, like, “What are you gonna do over the summer?” and I was focused on four different things. One was working a startup, the other was, perhaps working in VC, the other was working in management consulting, and the fourth was working at a large corporation that had a great leadership and management program, like GE or Johnson & Johnson.
The startup thing, I said, “You know what, I’m here to get additional credibility, given my non‑profit background, and I’m not sure that, that helps me, at least this summer, ’cause I feel like I have a sense of what startup life is like, so maybe I shouldn’t focus on that on my summer.”
The working at a VC, I quickly realized that, that wasn’t really on the cards, because most funds don’t love MBAs and don’t love MBA summer interns with non‑profit backgrounds.
Then I started to look at management consulting, and some of the big corporations ended up getting an offer from McKinsey, and between my first and the second year, worked at McKinsey, while simultaneously working with my Warby Parker co‑founders to push Warby Parker forward.
In some respects, my time at business school, I was hedging my bets between, “Would Warby Parker take‑off in the startup world?” but also, “Would I have an offer afterwards?” I’d just gotten married, literally in the first couple of days of school. I didn’t realize that Wharton started so early. It was the second day, and I was like, “OK guys,” to my new friends, “I gotta go. I gotta get married, but I’ll be back in a few days.”
The Startups Team: The first time we met, it was at a dinner and you struck me as a huge nerd about being an MBA.
I think you were telling me, when you and your three co‑founders, the first bar that you went to, you were doing 360 degree reviews of each other, and there were only four of you in the company, like the company was barely a company.
You’re like the kid who’s hand‑baking cookies for Santa three weeks before Christmas.
Neil Blumenthal: Yeah, setting the strategy, hiring the right people, we did nerd‑out about that sort of thing.
I think especially when in comparison to a lot of other e‑commerce companies ‑‑ and I don’t know if we really consider ourselves a pure e‑commerce company, in fact, we definitely don’t ‑‑ but the difference between building a lifestyle brand versus being a retailer is a massive distinction.
The Startups Team: Did you start the company thinking, “We won’t be e‑commerce,” or did you discover it along the way like some of these other guys?
Neil Blumenthal: Yeah, the impetus to start this company was the fact that we each had that experience walking to an optical shop, getting excited about a pair of glasses and then getting hit with a bill and getting up‑charged along the way, and walking out, feeling like we got kicked in the balls.
When we looked to resolve that issue, the question is like, “What’s the best way to do that?” We felt that we could design beautiful glasses and manufacture them using great materials because that was my background.
We thought that we could build a website, and the beauty of e‑commerce for us was the ability to have direct relationships with our customers. For us, it was about bypassing retailers, bypassing the middle‑men that would markup frames and lenses, three to five times what they cost, so we could transfer all of that cost directly to consumers and save them money.
The other piece was that, when we look at the way glasses are typically sold, they’re often licensed, so when you buy Ralph Lauren or a Chanel pair of glasses, it’s actually a company called Exotica that’s designing them and paying a licensing fee between 10 and 15 percent to that brand, to slap that logo on there. If we did our own brand, we could give that 10 to 15 percent back to customers.
The other thought process was, by building a brand, it’s a lot more defensible. We knew we were never going to be the “lowest cost of glasses” provider out there, we always thought that we would always provide the most value. To us, value is that price to quality ratio, plus all the other tangentials like, “What does this stand for?” “How does this make you feel?”
From the get‑go, we spent a ton of time thinking about our brand architecture. Once we defined what that was, and getting into the nitty‑gritty of “What we are, what we aren’t,” and having debates over the words like, collegiate versus preppy, and the fact that collegiate is more about learning and life on a campus, versus preppy, which has a certain connotation of wealth and status.
We spent a lot of that time, and then we even spent six months figuring out what the best name would be for the brand, because there were four of us and Blumenthal‑Gilboa‑Raider‑Hunt doesn’t roll off the tongue, exactly.
Once you have a brand architecture and you know what you stand for, it’s a lot easier to come up with a name that fits that.
Then we went about designing our first collection, trying to figuring out what we should price it at, and then building our website, mapping out each page in PowerPoint.
We would print them out and go up to our friends and say, “This is sort of how the home page would look. What button would you press?” “Oh, that takes you to the gallery page. What button would you press?”
The Startups Team: You’ve got to be the only startup I know that did A/B testing by printing out PowerPoint.
Neil Blumenthal: Then we took those wireframes and went to a friend of mine’s younger brother, who was a graphic designer and artist, and said, “Help us make this pretty,” so he would design all of them and we’d go back and forth, back and forth. Then we hired some developers to help us build the website.
Being that this was the first time that we built a website, we had gotten quotes from four different groups, one of which was half the price of everybody else. We thought, “Oh, we gotta go with this person.” Wrong decision, and within six months, had to fire that group and all the work that they did was crap, so you live and you learn.
Simultaneously, we had hired a PR firm…
The Startups Team: You hired a PR firm before you had a product?
Neil Blumenthal: Before we had a product, because we knew that we’re building a fashion label. For a consumer brand like ours, we believe that you only have one shot at launching properly.
We knew how the game was played. I grew up in New York, this is the fashion capital of the world. My wife had a contemporary jewelry line called Rachel Lee, that was sold in 400 doors, including Bergdorf and Bloomingdales, and before that, she worked in PR at Yves Saint Laurent, so we had a sense of how it works.
We ended up meeting with 40 different PR firms and freelancers, before selecting one that we felt could properly represent our brand.
The Startups Team: I want to be clear, you met with 40 different PR firms, but only a couple of web designers and picked the cheapest one.
Neil Blumenthal: I never thought of it like that.
The Startups Team: This is what I find fascinating about what’s happening both in New York and in LA right now. I believe that the reason we’re seeing lot of great companies come out of these places ‑‑ New York obviously more so than LA right now ‑‑ is because the entrepreneurs are playing to that city’s strengths and they’re not trying to play Silicon Valley’s game.
You were very much not trying to be a Silicon Valley startup in New York. You were not a Silicon Valley startup.
Neil Blumenthal: No, we were trying to solve a very specific problem and create this vision for a brand that we hoped that would resonate with other people, because for us, this idea that, especially fashion labels should connote this aspirational lifestyle built on wealth and luxury, seemed a little empty to us, and a little dated.
We thought about, “What motivates us? What represents us?” In particular, eyewear sits on your face, this is a core part of your identity. To us, there wasn’t this correlation between price and aspiration, it was more about fun, creativity, purpose, what does eyewear say about who you are.
There’s a utopian version of the world, where it’s like, “Oh, you don’t have to think that much about fashion or style,” but that’s BS.
Even the people that spend little time thinking about what they wear, still make very conscious decisions on what they wear and it says a lot about who they are. That was something that I realized doing my work at VisionSpring that, that transcends borders, it transcends socio‑economic status.
An example is that, you could be dealing with the poorest person in the world. You could go back to some of the regions in Bangladesh, somebody could literally be blind and they’d rather remain blind than wear a donated pair of 1970’s cat eyes, because they’d get laughed at by their friends and neighbors.
That’s why it was so important that, when I was at VisionSpring, I would design glasses according to the styles of those communities. In South Asia, gold wired frames and gunmetal frames were super popular, whereas in Central America, it was more similar to what you’d find in New York or LA.
The Startups Team: It’s interesting, as I listen to you describing the business, it’s like you’re saying, you’re specifically not an e‑commerce company. You’ve never once referred to yourself as a tech company and you don’t have a technical co‑founder. Technology seemed to be almost an afterthought, after other stuff.
You do consider yourself a social enterprise and a fashion label. You have a very different conception of who you are than even the startup press does, or the market does. You probably, usually, get described as an e‑commerce company.
Neil Blumenthal: We do quite a bit. We’re hoping to change that a bit.
In this day and age also, people love to categorize. It’s very natural for people to bucket because that’s how we organize our thoughts. I like to think that we live primarily in three communities. One’s the fashion world, one is the tech startup world, and the other is a social enterprise or non‑profit world. I’m comfortable being in that Venn diagram.
We do have a sizable tech team, and some of the stuff that we’re doing is pretty interesting stuff. We’re writing our own point‑of‑sale, and we have already deployed it, and we’re making improvements every day. In fact, we’re figuring out what we should brand it and call it, because it’s not a point‑of‑sale, it’s this whole mobile retail platform, that’s like a concierge service.
The Startups Team: That goes in different showrooms?
Neil Blumenthal: Exactly, and our stores, where our vision of the future is at. Retail is not this black and white choice, e‑commerce or bricks and mortar. The future of retail is a convergence of the two and this omni‑channel experience, and nobody has really cracked that code yet. We’re hoping to be a pioneer here and figure out, how do we create as consistent and as awesome experience as possible.
This is, going into it again, not with a bias towards e‑commerce or bricks and mortar, this is going into thinking about experiences and putting the customer first.
We started this company because we had crappy experiences buying glasses. They were overpriced, you’d walk into most optical shops and the glasses were untouchable. They were in a glass display or behind the counter on shelves way out of reach, and that’s not a fun experience.
When we think about design, we think about the moment someone hears about the brand, their decision to shop, that shopping experience, whether it’s offline or online, the purchasing process, the anticipation of waiting for the glasses, the unpackaging of the box, using the glasses on an ongoing basis.
The Startups Team: How does cracking this code of this experience go beyond what we’re seeing in showrooms?
Neil Blumenthal: It’s distinct because, again, show-rooming implies that e‑commerce is the only way forward. We prefer to look at our customers as diverse.
If you think about them on a risk spectrum, the least risk‑averse will go to our website and buy a pair of glasses, no problem.
The medium risk‑averse people will come and do a home try‑on, where we ship people five frames in five days to try it on at home, with no obligation to buy. The most risk‑averse people will wait to go into a physical setting.
We create experiences for all of them, but we also recognize that even within that spectrum, people may want to experience the brand physically and go into a store. They may want an impulse buy, like a pair of sunglasses and want it immediately.
In our stores, you can walk out with sunglasses, you can even walk out with frames without prescription lenses in them, and if you want to fill them yourself later on, by all means. It’s really, designing that experience.
We also want people to experience both, because we’ve seen a bunch of research that shows that customers that purchased brands in multiple channels, end up having higher customer lifetime value. It’s very synergistic.
We’re also finding that our stores are these amazing customer acquisition tools. It’s a marketing channel for us, and it’s profitably bringing in new customers. We’re also finding that the majority of those new customers that come in through our retail channel are making their second purchase online. From a business standpoint, it’s quite beautiful.
The Startups Team: Do you think that pure e‑commerce is done? Has Amazon done it, in terms of, “I need something, and I need it for the cheapest price. I want super ease of use, really, really good terms, I don’t wanna pay shipping, I just wanna go and Amazon almost reads my mind. It’s a couple clicks and then it’s like, showing up the next day.”
Neil Blumenthal: I think 99 percent of the time, it’s a losing proposition to go against Amazon. Not that there’s not some room in there, diapers.com demonstrated that you could do that and you could win on service.
Now of course, they were acquired by Amazon, but my wife and I, we happily paid a premium to buy diapers from diapers.com, because the purchase process and the customer service was head and shoulders better than the traditional Amazon experience. It’s really hard to sell somebody else’s goods online and compete with Amazon.
That’s one of the reasons why you’re seeing these emerging vertically integrated brands, because that’s how we’re able to differentiate. You can’t buy Warby Parker glasses on Amazon.
I do think that there are certain categories that e‑commerce will dominate, and that split between bricks and mortar and e‑commerce will be overly e‑commerce, and that’s some of these paper towels, diapers, groceries.
We have a two‑and‑a‑half‑year‑old son, we’ve never bought diapers in a store, and I don’t think we ever will. I’m sure our son Griffin, once he’s old enough to have children, and he never will either. There’s certain categories that are going to skew tremendously towards e‑commerce.
Then there are other categories, particularly like fashion, apparel and accessories that are always going to have a big bricks and mortar presence to them because shopping is often a form of entertainment. It’s about discovery, and it’s about fun and it’s about entering this world. As cool as we can make online experiences, physical experiences are different.
A lot of these companies are being started because people assume that it’s a good idea. People are so excited by entrepreneurship right now that they think that, “This is gonna be my ticket to building an awesome company that’s going to get covered in “Pando” or in “The New York Times.”
I’m not sure that they’re solving real consumer challenges, or making fun and exciting experiences that people want to have.
The Startups Team: You talked about how much time you guys put into, even choosing the synonym that you wanted to most describe your brand. I remember when we had dinner a while ago, you made a comment that Warby Parker wasn’t pretentious. I don’t think everyone in the world agrees with that.
I think a lot of people see it as a hipster, pretentious brand. The New York magazine profile painted you guys a little bit as an insufferable millennial company.
I’m curious if you feel like, all of that meticulous work that went into, “What we wanna be represented as,” has really translated into the market, or do you get frustrated when people think you’re something that was not what you intended?
Neil Blumenthal: It was interesting, I was having a conversation recently with Troy Carter, who started Atom Factory and is Lady Gaga’s manager. We were talking about branding and this new environment that we’re in, and he said something that stuck with me, he said, “It’s not your brand, it’s our brand.” In today’s world, with the Internet, with social, that is truer than ever before.
Even 50 years ago, you’d always measure brand health by serving people and seeing what the perception of the brand is. Now, I think, consumers and the public shape brands in a way that’s never been done before.
I’m not sure that I agree with some of the points in that New York magazine article. I don’t think of ourselves as an insufferable millennial hipster representation.
I do think that we have a lot of traits that are consistent with millennials because the majority of our team is millennials. It’s a place that I don’t mind being, because that’s the future, at least for the next 20 years or so, so I’m very happy to be there.
I think that what millennials care most about ‑‑ and this is not to say that other generations don’t care about it, but millennials seem to be the most vocal about it and take the most action related to it ‑‑ and what that it is, is care about the environment, care about social issues like health and education, income inequality, international development, caring about learning.
These millennials, if they are not learning every day; if they’re not being exposed to everything in the organization, and don’t feel they’re learning and are aware of what’s going on, they let you know. They let you know vocally, and then walk out the door.
Warby Parker really tries to represent that in that we try to be stakeholder‑centric and think about our impact on the environment, on the community. For every pair of glasses we sell, we distribute one to someone in need.
The Startups Team: You’re very high ideal company. You got in some respect a little bit further than Google even saying like, don’t be evil and that you’re like you needed to actively do good. Eric Schmidt is ‑‑ I don’t know if this is apocryphal or not ‑‑ but many people say that he’s always long regretted that they put don’t be evil in their S1 because it was just something that came to back to bite them over and over and over again. We hold them to the standard they set for themselves. You don’t have any concerns about that?
Neil Blumenthal: I definitely think that that’s a risk. It’s funny people hate hypocrites more than they hate the big polluters. It’d be like Google propagates more crap than Exxon Mobil does.
Unlike the negative impact on the world where there’s orders of magnitude difference. This is a risk that felt authentic and right to us, and we thought that it was going to motivate us to come to work every day and that was our mindset.
When you’re building a company or working on a start‑up, you don’t always look 10 years down the road. I’m trying to do that now that we’re three years in, but I don’t know even if I was thinking about that Eric Schmidt comment if we would have done anything differently. Hold us to that standard and if we screw up, tell us, we’ll apologize. Hopefully, you’ll forgive us.
I think the Internet and social channels are a scary place where we see at times, the worst of humanity because there is some level of anonymity. It brings out the worst in people. There are far more negative Tweets than in our positive Tweets just worldwide about everything.
I think that’s just a shame. Maybe that will change over time as we get more comfortable communicating through these mechanisms when we establish stronger cultural norms that it’s unacceptable to bully online, that it’s unacceptable to harass people that you don’t know. I’m not sure and I’m certainly futurist or know anything about that.
When we think about our social mission, it’s really about impact and what is going to have the most impact, and how can we be really thoughtful about that. We’ve thought about that from the fact of how we distribute the glasses that we distribute to people in need. First thing is that we don’t do it ourselves because we’re not experts in that. I’ve done it, but I’m the only one in the organization that has done it, but I’m not spending much of my time doing that. We work with people that spend 100 percent of their time doing it and know how best to do it and know the pitfalls of unintended consequences.
By distributing glasses for free at times can create a culture of dependence. It’s not necessarily treating people with dignity because if you give somebody something for free, you’re often getting it donated, you’re not really asking them what they want. It isn’t sustainable and it’s like a Band‑Aid on the problem.
By working with non‑profits like VisionSpring whose have staff on the ground that are training people to create jobs, selling this product, that’s the best way to do it. On a monthly basis, we tally up the number of glasses we’ve sold, and then we make a cash donation to VisionSpring to allow them to procure that number of glasses.
They in turn sell those glasses to these entrepreneurs, who in turn sell it to people in their communities often for just a few dollars. They charge what the market can bear. In places like India and Bangladesh, it might be a few dollars. In Guatemala or El Salvador, it might be eight dollars of more even. It’s really about what’s going to have the most impact and then measuring that.
When I was at VisionSpring, we worked with the University of Michigan to take a look at what does a pair of glasses mean to somebody. We found that a pair of glasses increases somebody’s productivity 35 percent and their income 20 percent.
That’s just massive, if you think about working a five‑day week, that’s an extra day’s work per week. In international development terms, that’s just massive. We really focus on that, but we also are the donor.
We don’t need to solicit funds from other people and being the public eye to be really raising awareness. We don’t run into that pitfalls that some of these non‑profits run into. That being said, one of things that we ask ourselves is, “How can we do more?” We know that we’re not going to provide glasses to a billion people on earth.
As our brand gets bigger and as our megaphone gets bigger, maybe we can help. Maybe we can lead a coalition of organizations to really make a massive dent in this. If that’s the case, then we absolutely will be screaming from the mountain tops. Maybe that opens us up to some of these challenges that other folks have had.
The Startups Team: I want to talk a little bit more about you as an entrepreneur. Going back to Wharton when you had this serendipitous about how much the experience of buying glasses sucked.I feel like a lot of times particularly in school, you could say, “We should totally do that. We should totally do that,” but then it doesn’t actually turn into a business.
At what point did it really start taking shape?
Neil Blumenthal: I think we all had that itch to do something. There was a moment where it was like a come to Jesus moment, where I was like, “Are we gonna actually do this and not just talk about it?”
The way it really happened was, we were in the computer lab in between classes at school. Dave had mentioned to me how he had lost a pair of glasses in the seat pocket of an airplane. Andy had had this idea to sell glasses online, because he’d seen all these other categories move online. Like engagement rings and shoes.
Jeff, likewise, had a broken pair of glasses at home and was waiting for the right time to repurchase them. I had all this experience, so the light bulb went off and like, “This is really powerful idea.” Then of course, it was time to go to class. We all ran off.
I remember, just personally, that night I had trouble sleeping, because you know when you have a good idea and you’re just thinking about, “OK, well, what if it goes this way, this way, this way.”
Next day I get to school and I’m looking for Jeff, Andy and Dave. Sure enough, I see Dave and then he was like, “Oh, I’ve been thinking about what we were talking about,” I was like, “Yeah, me too.” Then we see Jeff and Andy and we were like, “Let’s all grab a beer tonight.” It was actually at the bar that we were talking about it and was like, “OK, we’re gonna do this.”
We gave ourselves a cheers. I said, “OK, we’re doing this, but let’s also, like, be real with each other that, what does this mean? This means that we’re going to really bust our ass and it’s going to have to be tradeoffs. Probably means less drinking.”
The Startups Team: After that night.
Neil Blumenthal: After that night. It also means that this could impact our friendship. It was there that we were like, “Hey, let’s do this in a manner where we’re gonna be able to remain friends.” I know it sounds cheesy, but it was that commitment that led us to do all of the dorky management stuff that, I guess, is why you think I’m a nerd with the 360s back in the same bar.
The Startups Team: What did end up happening? I know two of you are at the company and two of you aren’t. Are they all on the board?
Neil Blumenthal: Yeah. We’re all on the board. We started working on it first semester and business school is two years, so we all cranked on it that year and a half. Once we launched, Dave and I took over as co‑CEOs and have been running it since then.
Jeff returned to the private equity fund that he was at before school, because they had promise to pay for business school, he had that commitment. He since started Harry’s, the men’s razor and grooming company that’s trying to take on Gillette just like we’re taking on Exotica.
Andy went into venture capital, now he’s a principal at Highland Capital.
The Startups Team: Were there too many cooks in the kitchen? Were they not as passionate about it is as you? Why did the two of them leave?
Neil Blumenthal: They remain super passionate. I think that Andy was more passionate about helping to launch and start new companies, then invest in them, which is why VC was the route he wanted to take. Jeff had made this commitment that was his handshake and that was really important to him. That entrepreneurial spirit certainly hasn’t left and that’s why he’s doing Harry’s now.
The four of us are still super close. We’re actually all having dinner on Friday night. We actually all live within three blocks of each other, which is funny.
First thing that we did is we all invested the same amount of capital, because we thought that it would be really difficult for us to say, “You bring this to the table, so you should get a couple more percent or this or this.”
That could have been just that we’re all wussies and conflict averse.
Or it could be that we’re friends, if this works out, it’s going to be a home run for all of us a and percentage point here or there is not going to make a difference. It’s probably a little bit of both.
The other thing that we did was, we created a vesting schedule where equity would vest every month up until graduation. If somebody wanted to leave, they could do so without feeling guilty or us being resentful, because they would get diluted over time.
The Startups Team: There’s a lot of fetishizing of very young entrepreneurs who don’t know enough about how an industry knows. They have this pure way of coming in and disrupting it. They can work 24 hours a day and all these other great things.
You’re not in that camp. You’re someone who’s three years into what I imagine has been an insane ride. You’ve had a young child most of that time. Of the four of you, you were the one who knew most about the industry and knew most about what was being done wrong, whereas your friends and cofounders were like, “Hey, glasses suck.”
I’m curious if you think both are good approaches, or if you think some of this fetishizing of the 20‑year‑old genius is a little bit overdone.
Neil Blumenthal: There’s no question that Warby Parker has benefited from the fact that all of us had a bunch of work experience beforehand and we all brought that to the table. It was super, super valuable.
Earlier on, we probably each had that proactive mentality and just jump and problem solving. That’s absolutely necessary to start a company, but we made far fewer mistakes and we’re far more deliberate and thereby, Warby Parker has a much higher potential because we had that experience.
The other thing that really goes into it is just when does the idea come about? That, often you don’t decide. It’s whenever that idea comes about that you’re super passionate about, that dictates the right time, versus where you are in your career. People probably underestimate how important that is.
It’s not just that this idea has market potential, but you actually really give a shit about it. You’re willing to really risk a lot. You’re risking relationships because you’re spending so much time on this. You’re also going to be asking for help from all these people. You’re risking capital, both what you’re putting in yourself and what you’re foregoing from other work. You really have to really love the idea.
The other thing is that it’s completely OK if you think that this idea isn’t new or novel because at the end of the day, if your idea is so radical that no one else has thought of it, chances are the market is not ready for it. This is not to say that you should go and copy somebody else’s idea.
The Startups Team: A lot of people have criticized you saying, “They’re not the first one to do ‘Buy one, get one.’ They’re not the first one to see inequality in the eyeglasses industry.” You guys weren’t.
Neil Blumenthal: Right, and I was like, “Who cares?” We were the first ones to do what we do holistically, which is important. You need your own identity and your own strategy and management approach. There’s nothing wrong with learning best practices from around the world.
Andy Dunn has spent the past ten years building Bonobos. He’s funded about 15 other ecommerce companies, advises even more, and serves on the board of three others. In this interview, he shares his thoughts on better fitting pants, 100M in capital, and why men should embrace a world run by women.