Since its inception three years ago, online jewelry retailer BaubleBar has been in rapid expansion mode -- growing its online catalog of trendy, inexpensive jewelry; courting customers and press; opening pop-up shops and developing lines for Nordstrom and Anthropologie -- all with a relatively modest $5.6 million in venture capital. It will be interesting to see, then, just how much faster the company grows with the aid of its latest round of funding -- a $10 million Series B -- announced Tuesday.
The funding round was led by Burch Creative Capital, the firm run by Tory Burch co-founder (and ex-husband) Chris Burch. Burch is a first-time investor, and unlike most of BaubleBar's existing backers (which include Silicon Valley's Accel Partners and New York City's Greycroft Partners, also contributors to the latest round), his ties to retail and manufacturing run wide and deep: Beyond growing Tory Burch into a multibillion-dollar business, he's also the founder of retail chain C.Wonder; an investor in e-commerce startups Bib+Tuck, Trendabl and Vaunte; and helping get his daughters' promising young contemporary label, Trademark, off the ground.
"He definitely brings something new to the table in terms of experience and expertise," BaubleBar co-founder Daniella Yacobovsky told us, noting that when the company is hiring engineers, Greycroft and Accel are her first calls, but that no other investor has as much retail experience. "The folks he's capable of connecting us to ... we're just starting to chat with his network."
BaubleBar's founders clearly have an interest in growing their brand offline -- as we mentioned before, they've already hosted two pop-up shops in New York, and are working with Nordstrom's and Anthropologie's in-house design teams on BaubleBar-branded lines that are sold in each's respective brick-and-mortar stores. With Burch on board, should we expect to see a permanent store soon? Yacobovsky wouldn't say if there was anything in the works, but that it's "definitely something we always talk about." Rather, the $10 million will be "used for expansion quite broadly" -- for marketing, and for hiring across various departments.
All investors are keen to see a return on their investments, and we asked Yacobovsky if the company had an idea of when it would become profitable. "[Profitability] is something that Amy [Jain, BaubleBar's other co-founder] and I have been mindful of from the beginning," she says. "We're not profitable yet, but we are a company that generates quite a bit of cash flow -- you don't see us raising a massively enormous round, because we don't quite need it. We don't want to grow at the consequence of growing in an unsustainable way." That, we know, can be a very bad thing.