$WRBY 🕶 Warby Parker DPO S-1🕶 Breakdown

Victor Koch
8 min readSep 6, 2021


Victor Koch Warby Parker IPO


  • Warby Parker has filed for a direct listing of its Class A stock.
  • WPs snapshot: 33% (net revenue growth), $487M ( net revenue), 83 (net promoter score), 2M+ (active customers), 60% (gross margin), 145 (stores)
  • The firm sells eyewear products and eye care services direct to consumers via its retail store network and online.
  • $WRBY has proven its omnichannel business model to be resilient during the pandemic and its revenue growth has rebounded impressively.
  • Warby Parker intends to raise capital through DPO under the ticker, “WRBY”.

Founding Story

Andrew Hunt, David Gilboa, Jeffrey Raider, and Neil Blumenthal started Warby Parker 11 years ago to solve their own problems as frustrated consumers and to make a positive impact. They aspired to demonstrate that a business could scale, be profitable, and do good in the world — without charging a premium for it.

They have pioneered ideas, designed products, and developed technologies that help people see. WP offers everything to customers need for happier eyes at a price that leaves them with money in their pocket, from designer-quality glasses (starting at $95, including prescription lenses) and contacts, to eye exams and vision tests — and they can meet us online, at retail stores, or even at home.

Founders also believe that everyone has the right to see. Glasses enable people to learn, work, and navigate the world with more security and dignity, but 2.5 billion people around the world who need them do not have access. To help address this problem, WP partners with nonprofit organizations like VisionSpring to ensure that for every pair of glasses sold, a pair is distributed to someone in need. VisionSpring estimates that, on average, a pair of glasses improves personal productivity by 35% and increases monthly income by up to 20%. Through — Buy a Pair, Give a Pair program, they have helped distribute over eight million pairs of glasses to people in need since inception, increasing earning potential for low-income households by more than an estimated $1 billion.


Warby Parker is a mission-driven, lifestyle brand that operates at the intersection of design, technology, healthcare, and social enterprise.

Funding traction

Total raised ~$640M

Funds: D1 Capital, T.Rowe Price, Bullish, Durable Capital Partners, Baillie Gifford, Wellington Management, Tiger Global, General Catalyst, and etc.

  • Series A — 2011 at val. $132M, $1.8354 pps
  • Series B — 2013 at val. $293M, $3.45 pps
  • Series C — 2013 at val. $524M, $5.4682 pps
  • Series D — 2015 at val. $1.22B, $11.4853 pps
  • Series E — 2018 at val. $1.75B, $15.17 pps
  • Series G — 2020 at val. $3B, $31.05 pps

The company’s primary offerings include:

  • Eyeglasses
  • Contact lenses
  • Vision tests
  • Eye exams
  • Vision insurance
  • Virtual try-on tool

Customer Acquisition

The firm connects with prospective customers through its retail store network and online through a range of digital marketing efforts.

WRBY has approximately 145 stores and over 2 million active customers and has an average net promoter score of 83.

Selling, G&A expenses as a percentage of total revenue have fluctuated as revenues have varied, as the figures below indicate:

For the years ended December 31, 2018 (unaudited), 2019, and 2020:

  • WP generated net revenue of $272.9 million, $370.5 million, and $393.7 million, respectively;
  • WP generated gross profit of $164.3 million, $223.1 million, and $231.9 million, respectively, representing a gross profit margin of 60%, 60%, and 59%, respectively;
  • WP generated net (loss) income of $(22.9) million, $0 million, and $(55.9) million, respectively; and
  • WP generated adjusted EBITDA of $8.6 million, $21.9 million, and $7.7 million, respectively.

For the six months ended June 30, 2020 and 2021:

  • WP generated net revenue of $176.8 million and $270.5 million, respectively;
  • WP generated gross profit of $102.8 million and $161.8 million, respectively, representing a gross profit margin of 58% and 60%, respectively;
  • WP generated net (loss) of $(10.0) million and $(7.3) million, respectively; and
  • WP generated adjusted EBITDA of $1.2 million and $20.1 million, respectively.

For a definition of adjusted EBITDA, a non-GAAP measure, and a reconciliation to the most directly comparable GAAP measure, see the section titled “ — Summary Consolidated Financial and Other Data — Key Business Metrics and Certain Non-GAAP Financial Measures.”

As of December 31, 2018, 2019, and 2020, and June 30, 2021, the key operational metrics of business included:
•Store Count of 88, 119, 126, and 145, respectively; and
•Active Customers of 1.45 million, 1.78 million, 1.81 million, and 2.08 million, respectively.

Market Opportunity

The U.S. eyewear market is large and growing. The Vision Council defines the U.S. eyewear market in 2020 as an approximately $35 billion industry that has exhibited consistent, stable growth, and estimates the U.S. glasses market to be approximately $21 billion. Globally, the eyewear market is over $140 billion, according to Statista and internal company estimates. The industry includes optical retailers’ revenue from the sales of products (including glasses, sunglasses, and contact lenses) and eye care services provided by vision care professionals, including eye exams.

The eyewear industry is resilient to economic cycles given its medical and non-discretionary nature and is defined by durable fundamentals and trends including:

•Most people need vision correction: The Vision Council reported that nearly 200 million or 76% of adults in the United States were using some form of vision correction in 2020. In addition, the number of Americans ages 65 and older will more than double over the next 40 years; it is estimated that at least 84% of people aged 65 and older wear corrective lenses.

•Consistent replenishment cycle: On average, glasses wearers replace their glasses every two to two and a half years. Additionally, an estimated 42 million people in the United States wear contact lenses and nearly 70% of contacts wearers purchase contact lenses at least two times per year.

•Increasing screen time usage: The rising usage of smartphones, tablets, computers, and other devices has contributed significantly to increased vision correction needs and consistent new customer growth within the eyewear market.

•Acceleration of e-commerce penetration: E-commerce penetration is largely nascent in the eyewear industry, representing approximately 5% of sales in 2019 and 8% of sales in 2020.

  • Increasing prominence of telehealth: DTC telehealth is expected to surpass $16 billion by 2025, reflecting an evolution of consumer preferences from in-person to remote medical care.

Industry-wide, a significant portion of customers who use prescription glasses or contacts purchase them from their prescriber. By contrast, the majority of customers have historically obtained their prescriptions from non-Warby Parker doctors, underscoring the opportunity to expand their own optometric and telehealth services and offer these services to more of their customers. By WP calculations, in 2020, the company sold glasses and contacts to less than 2% of all adults who use some form of vision correction in the U.S; given their lower price point versus the rest of the industry, the market share by net revenue in the U.S. was only 1%, leaving the companywith meaningful opportunity to scale in the years and decades ahead.

Major competitive:

  • EssilorLuxottica
  • VSP
  • Prada
  • Guccio Gucci
  • Christian Dior
  • Sea2see Eyewear
  • PEL China
  • CooperVision
  • Carl Zeiss
  • Bausch & Lomb
  • Safilo Group

Consolidated Financial And Other Data

Direct Listing Details

Warby Parker intends to effect a Direct Listing transaction of its Class A common stock.

  • Class A common stockholders are entitled to one vote per share and Class B stockholders receive ten votes per share.
  • The S&P 500 Index no longer admits firms with multiple classes of stock into its index.
  • All of the proceeds from the Direct Listing will go to the shareholders who elect to sell their shares on the open market; the company will receive no proceeds from the listing.
  • Management’s presentation of the company on an investor day is not yet available.
  • Regarding outstanding legal proceedings, management believes that any claims against the firm would not materially affect its operations or financial condition.
  • Advisors for the Direct Listing are: Goldman Sachs, Morgan Stanley and Allen & Company.

Risk Factors

•Increases in component costs, shipping costs, long lead times, supply shortages, and supply changes could disrupt their supply chain; factors such as wage rate increases and inflation can have a material adverse effect on the business, financial condition, and operating results.

•The optical industry is highly competitive, and if they do not compete successfully, the business may be adversely impacted.

•If they fail to cost-effectively retain their existing customers or to acquire new customers, the business, financial condition, and results of operations would be harmed.

• Their profitability and cash flows may be negatively affected if they are not successful in managing inventory balances and inventory shrinkage.

  • If they fail to maintain and enhance their brand, the ability to engage or expand the base of customers will be impaired, and the business, financial condition, and results of operations may suffer.

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Who is Victor Koch?

Victor Koch

Mr. Koch — a serial entrepreneur and late-stage investor specializing in secondary shares.

Previously: Twilio, Xiaomi, iQiyi, PinDuoDuo, Tilray, Livongo, Agora, Bandwidth, TransferWise, Oatly, Hims, Coursera.

Currently: Robinhood, Enflame, Grab, Intercom, FaDaDa, Stripe, Toss, Epic Games, Chime, and other

Contact — here, If you are a startup building in this space — email or DM me to be included in this article.

The content was collected from various open sources, approved by companies, and does not provide any one-stop recommendation for the purchase of shares. All data was used for only informational purposes and does not contain insider information that may be malicious or refuted by the company and SEC.

This communication does not represent an offer or solicitation to buy or sell securities. Such an offer must be made via definitive legal documentation by the buyer or seller of securities, please check the SEC rules before buying shares from any stock-suppliers.



Victor Koch

Serial entrepreneur, accredited investor, and hedge fund manager. Ex-General Partner of Koch Fund