Gemvara Raises $25 Million to Become the Zales of the Internet
A majority of people have never bought jewelry online, but that isn’t keeping Gemvara from trying to change that.
“Our intent is to be as aggressive as possible in doing that and to ultimately do to Tiffany’s and other local jewelers what Amazon did to Barnes & Noble and other local booksellers,” said Matt Lauzon, Gemvara’s 27-year-old founder and CEO.
Lauzon said to achieve his goal he has raised $25 million in a fourth round to fuel the company’s next stage of growth.
The round was led by Norwest Venture Partners with participation from Highland Capital Partners, Canaan Partners and Balderton Capital. In total, the Boston-based company has now raised $50 million in capital since launching in February 2010.
Still, Gemvara can’t truly be compared to Zales, Tiffany & Co. or even BlueNile.com.
Instead of selling the latest fashions, the online jewelry store allows customers to design their own rings, necklaces or earrings from scratch from a selection of 26 gemstones and eight metals. Once an order is placed, the piece is manufactured in the U.S. and shipped to a person’s home.
Since founding the company, Lauzon says he has been surprised by several things:
- The average order size is $1,000.
- The most expensive piece sold to date is $85,000, and pieces can regularly cost between $10,000 and $20,000.
- People spend 18 to 21 days designing their piece before purchasing, making return rates very low.
- A woman typically influences the design, but a man normally makes the purchase.
To leverage the content-sharing trend, Lauzon said the company is training all 55 of its employees how to pin stuff on Pinterest and has plans for a massive site redesign that will integrate Pinterest very closely.
Here’s the entire funding release:
Boston, MA; June 4, 2012 – Gemvara, Inc., the leading online retailer of customizable fine jewelry, announces the closing of a $25 million oversubscribed round of Series D funding. Led by Norwest Venture Partners (NVP), a global venture and growth equity investment firm, the round also involves participation from all existing investors including Highland Capital Partners, Canaan Partners and Balderton Capital. Sergio Monsalve of Norwest Venture Partners will join Gemvara’s Board of Directors. Gemvara plans to use the capital to further enhance all aspects of the customer shopping experience and continue to drive innovation that will bring the jewelry industry to the cutting edge of commerce.
“Gemvara is a very strong company with a stellar team, and happens to be at the epicenter of three e-commerce megatrends that we have been watching closely– the emergence of personalization, the rapid growth of Pinterest as a ‘wishlist’ aggregator and the rising adoption of the iPad as a visual shopping platform. Gemvara is quickly becoming a major player in this rapidly changing next generation e-commerce sector and we’re looking forward to partnering with the team to grow the company further,” said Monsalve of NVP.
“We are redefining the rules of commerce and we’ve proven that people will buy meaningful jewelry online,” said Matt Lauzon, CEO and Founder of Gemvara. “This investment accelerates our mission of having more loyal customers than any other jeweler.”
“Gemvara’s unique customization technology platform is revolutionizing the fine jewelry market,” said Bob Davis, General Partner at Highland Capital Partners. “We have been an investor with Gemvara since 2007 and it has been exciting to see the company grow from inception to the innovative e-commerce trend-setter it is today.”