Over 400 Startups Are Trying to Become the Next Warby Parker | Hacker News Reader

Over 400 Startups Are Trying to Become the Next Warby Parker

inc.com

73 pointsfourmii67 comments

It's hard for me not read this article and see a metric f-ton of hubris. If the depth of your thinking is that you are the Uber of X, the warby-parker of Y, you are so screwed.

If you've been around startups - the key is some kind of very early customer feedback loop; Customer Development from the lean startup process, the working backwards process from Amazon, etc. Adding VC money on top of this seems like fuel to a group of founders who haven't really considered that their model is not sustainable. And the VC's don't fundamentally care - they just need some small percentage to succeed.

One key quote from the article is "that CAC is the new rent". That's a nice way to view D2C. And let me tell you the last time I was doing D2C our CAC was $500 and you had to spin a pretty good yarn to make the lifetime number add up.

These people are such brilliant visionaries that they thought they best use of two years of their 20s/30s was to borrow $200k to go to business school and get an MBA.

Wow /s

Optician here with some relevant experience regarding the opthalmic space, recognizing that isn't primarily what the article is about.

For the most part glasses still have to be custom made to some extent.

That process has been getting more sophisticated (smarter edgers, free form surfacing everywhere) and faster processing times.

But getting the formula right on mail order is hard.

First you have limited information about and from the patient. You have a PD (pupillary distance) and all of these services, that I have seen only collect a binocular pupillary distance.

The lenses have to be, at the very least cut to shape to fit the frame selected with the optical center of the lens moved so it sits over the pupil of the wearer when they are in the "gaze posture" appropriate to the glasses

That is to say if they are distance glasses the pupils will be looking straight ahead, while using the glasses, but the person's eyes may be 3mm narrower than the frame selected, so before grinding the lens that 3mm must be taken out of the "middle"

If one eye was in two and the other was out eight though (very uncommon) you have a reject pair.

If the glasses were of high power and one eye was out 1 and the other eye were out 2, if we were over 14 diopters of correction we fail quality. But not because the glasses, how they fit the patient's face 2000 miles away.

Hey, UtilityDave, all of your comments are dead on arrival (I vouched for all of them, as they seem well within guidelines). You might want to email the mods to get that fixed, as the only sin it looks like you've committed is not using your account.

I mostly want to try to spread more information about this sector of the economy, it is interesting, and I really wish there were more competition.

Right now there are competitive garden walls if you want to use Zeiss, essilor, rodenstock, and Hoya lenses it is a nightmare to keep everyone current, and lab networks are very difficult to use for end user opticians let alone patients.

If you want to disrupt opthalmic dispensing

Start by making good EHR for offices with good product and lab network integration.

None of the big boys have gotten that or lims with solid legacy support going yet.

Maybe you're just tacking on a general reply to my comment, or maybe you misunderstood what I am saying. When I say "dead on arrival", I mean that your comments are "dead" in that no one can see them (unless they change a setting from default). YOU can see them, but no one else can.

That said, it looks like the mods have fixed it behind the scenes, as your last comment did not show up as "dead".

I was unclear. Thank you ( just woke up) thanks!

Oh man. The subway ads for this shit are so annoying. At least there was comedy value in the sketchy lawyers and plastic surgeons. If I see another ad for a boring ass household sundry that has been "reimagined", I think I'll puke.

Moreover, who buys this shit? If I had a bunch of overpriced bath towels that I bought from one of these DTC things, I'd be terrified of the idea of a guest seeing them and recognizing them.

You know, it's crazy but things like Brooklinen slowly worm their way into people's heads that they need this kind of stuff.

I'm sure that they're nice sheets, but I just hear more and more "I've heard they're really great quality/convenient/etc" and the actual anecdote where they got this is several degrees removed. The ads just look nice.

I am in market for new glasses and I looked at Warby Parker. I have to say I am not impressed at all. The choice is very limited and buy cycle is too long. When people need glasses, they usually need now. Bezos understands the value of instant satisfaction, these guys don’t. There are easier tech solutions they could have used like try it out on your photo (which companies like Zenni have implemented quite well but they have same issues). These guys insist on sending you frames which don’t arrive for a week and then you order and then someday you receive glasses. When I walk to local LensCrafters, I can walk out with a pair in couple of hours. Their website is also nightmare to browse through but it might make perfect sense to them. As a customer, I don’t care about their business categories of try at home or not. I just want lots of choices and I want them now. Amazon has truely spoiled me.

They are indeed doing good level of PR in publish-for-pay websites like inc.com, however.

>When people need glasses, they usually need now.

I'd substitute sometimes for usually. If you've broken your only pair of glasses then you do indeed need something now. But lots of the time, people just want new frames, or decide to get sunglasses, etc. You may underestimate how many people see glasses as a fashion accessory rather than a utilitarian device you wear to correct your vision.

>They are indeed doing good level of PR in publish-for-pay websites like inc.com, however.

If anything, it seems more like a PR pitch for UPenn though there's plenty of skepticism in the article as well. I thought it was an interesting piece. You do realize that writers don't just sit in an office with their computers turned off and have ideas for stories pop into their head? I'm sure someone pitched a story here but I don't know why you'd assume there was a payoff involved. It seems a pretty balanced piece.

Even if you need to get glasses that better match your prescription or your glasses are getting scratched but are still usable, you might not need them now. I've worn glasses for almost 30 years and I've never been in a rush to replace them. At least around here it usually pays to wait for sales; it's easy to save a couple of hundred euros if you can wait for a while.

My experience with these 2 companies; Last year I had to buy Rx glasses for the first time. I bought 2 pairs, one WP and another at Lens Crafters. I went to the retail WP store because I had to try them on. I can't buy this type of product based on a picture on a website. I went there first, bought a pair that I didn't love but it was the best they had for me. Then I went to LC and found a pair of Ray Bans. The buying process seemed similar. Each store had to ship me the product a few days later. But LC wins for selection. The WP glasses feel cheap. The plastic material the frame is made from just feels cheap, unfinished, and are not comfortable. The lens are inferior, they have a prism effect when light hits them the wrong way. The Ray Bans are a similar form/material as the WPs, but they feel nice; comfortable, the plastic frames feel well made (no jagged edges), the hinges move nicely, and the lenses are great. Needless to say, I wear the Ray Bans daily and the WP are more of a spare pair. I won't be shopping at WP again.

To be fair, I don't recall the cost. The Ray Bans may have been 2X or more than WP. In which case, I'd still shop LC for the better lens.

I’ve never walked out of a store with eyeglasses I just baught. I don’t think that experience is typical.

It totally depends on your prescription. If there’s no astigmatism, the lenses can be stocked and cut to the frames you need. Astigmatism adds another two variables that make it much harder to stock. Also the stronger your prescription, the more alternative material options there are to keep the thickness down, which again makes it harder to stock everything.

Most offices who keep stock lenses keep cyl (astigmatic correction) up to two diopters in quarter increments in my experience.

The main limitation is usually material choice.

in the Boston area it is typical, several choices to bring your script and have new glasses in an hour or two, i have used lencrafters for 10 years like this

Wow, that's awesome. I've never been able to get glasses in less than two weeks. Last time I went to Lenscrafters was 20 years ago, I guess they have changed a lot since then.

> I am in market for new glasses

I don't know where you are, but my go-to glasses provider is Owndays, the japanese chain. Decent range & fashion, competitive prices and - crucially! - they keep common prescription lenses in stock. I keep a photo of my prescription on my phone and I've been in and out of there in 20 minutes.

The idea of going to an old-style glasses shop where they want $500+ and then you have to wait a week to even get them just seems laughable now, and Warby can't compete either. I predict further mass extinctions in this vertical.

I'm sure it's fair that there's a level below Warby Parker. Heck, I buy reading glasses (which I need when I'm wearing contacts) by the 5-pack from Amazon for about $5 each. They're not optimized but they're close enough and I can scratch them and lose them and break them.

It does depend what's available around where you live though. There's a Warby Parker in Cambridge MA and I'll probably get another pair of glasses there at some point. (Although it's complicated because I have good insurance I can use with my regular eye doctor/vision place.)

If you get any of essilor's scratch coats (or any of unity's they offer a warranty your optician may not tell you about (so he has more wiggle room, or he may buy without warranty to save money)

Thanks. I actually wear contacts most of the time--which is when I need readers. They're the ones that beaten up because I'm always taking them on and off and sticking them in pockets.

Yeah, can't get much cheaper than readers, unless you want to get a pair with glass lenses for very long term (much harder to scratch, can shatter)

Maybe I’ll get a prescription for readers next time. I got progressives last time I was at the doctor and love them for when I’m around the house.

Progs are pretty great. Some minor downsides, but comparing them to a lined bifocal... Depends on personal preferences.

Neat Sherlock Holmes Ian trick, at about halfway up your lens, near the nose, and temple, there are some laser etchings (your progressives) these should tell you what kind of lens they are and how much add power you have

If people needed glasses "now" the local optician would not be a dying trade, and LensCrafters wouldn't have killed off half of their labs three years ago, while eliminating the one hour guarantee.

Davis optical also closed a load of their labs. Quick turnaround spectacles are seeing some changes.

I bought Warby Parker glasses once a few years back. The lenses got scratched up pretty bad and they no longer fit. But they’re fine. Cheaper than designer.

These days I’ve had to go with Eyebuydirect. They’re cheaper and the turnaround is about a week. Some of the plastics aren’t as nice as high priced frames but still good and the metal frames are pretty standard.

Fifteen years ago, buying glasses was a three-week experience that could be expected to cost in excess of $300. Now I can get two pairs, retail, for that price in a single day.

Warby Parker has helped make this accessible, and for that I'm very grateful.

Perhaps their target market are those more interested in fashion than utility.

I guess I forgot that not everyone has walk-in Warby Parker stores like NYC does…

Good article. The gist of the piece is that a lot of these direct-to-consumer businesses are trying to "disrupt" markets that the vast majority of people don't see as broken.

There do seem to be some different categories of products here. One is essentially trying to create new luxury brands for, e.g. toothbrushes, that either don't exist or are pretty old-line and non-millennial.

Others are trying to take business from entrenched dominant companies as in eye wear--which is what Warby-Parker did. However, as the article notes, it's not clear how many of those there are. Are high-end towels, etc. really an example of a market failure today? Probably not.

> The gist of the piece is that a lot of these direct-to-consumer businesses are trying to "disrupt" markets that the vast majority of people don't see as broken.

You can do interesting things with products when you remove some of the vast middle-men distributors that sit between you and the customer and reclaim margin. Whether producing a higher quality product at a lower or similar price, or producing an equal quality product at a far lower price.

Plus, the big product conglomerates and retailers have an effective monopoly on traditional product access (Colgate, Kraft, Procter & Gamble, Walmart, Target, Costco, Walgreens, et al). The margin saved by removing some of the middle-men, can then be used for distribution-marketing-sales to reach out to customers in order to breach that comfortable group monopoly.

Maybe.

>A Bristle subscription would be more convenient than going to CVS when you need a new toothbrush--you'd order online, set your replacement-head frequency, and forget about it.

Picking up a toothbrush every now and then--assuming you don't just get given them at every cleaning by your dentist--is so far down the list of problems that I and most people have as to be negligible. Furthermore, I doubt if middlemen markups on toothbrushes are a big problem when in fact overheads are probably far lower overall.

There are clearly some things like eyeglasses that the existing market is fairly broken. But most goods simply aren't in that situation.

Yes. Also. Glasses are a fashion / style item. There are ppl who want something different / obscure. That feeds traction. That feeds "Nice glasses. Where'd ya get them?"

On the other hand, who has conversations about toothbrushes and such?

As someone with a toothbrush subscription: I now change my toothbrush every 3 months. Left to my own devices it was closer to every year.

I am assured by everyone that this is better. I don't really feel like it's something worth thinking about so I am happy it's being taken care of by not-me.

A wholesale pack from Costco and a repeating calendar event on your phone accomplish the same thing, and I don’t see how shipping an individual toothbrush can be cheaper than that. And I would think many people already have spare toothbrushes lying around in case family or friends visit and don’t have theirs.

That's my feeling anyway. Managing a bunch of subscriptions sure seems like a lot more mental effort than adding things to shopping lists when they're running low or doing as you say. (Unless it's really something you use substantial and predictable quantities of.)

I’d assume most people at least change it when they get a free one at their six month cleaning.

Looks like you're also assuming most people can afford cleanings twice a year...

A dentist cleaning without dental insurance is $100 or less in the US. Yes, I realize there are people for whom that is a non-trivial expense. The overlap between that demographic and those getting some startup toothbrush service is, I would assume, nil.

If you're a consumer of niche subscriptions, I don't think a dentist appointment every 6 months is going to be a financial burden.

Dollar Shave Club succeeded in a similarly “boring” category.

Well they were able to subvert the "Gillette" pricing strategy (give away the shaver and sell the blades). There was a lot of margin in the prevailing blade prices that they could undercut and still make money.

Offtopic, for me the best value in shaving is to buy an old-fashioned "safety razor" with the replaceable double-sided blades. The blades are dirt cheap and in my experience are sharper than what you get in other multi-blade shavers.

> There was a lot of margin in the prevailing blade prices that they could undercut and still make money.

I also suspect they do not have fat margins on the razors, but the ancillary purchases you can throw in with your monthly razor delivery: shaving cream, aftershave, etc.

They succeeded because they were cheap. Those toothbrushes are pretty expensive (compared to $1/each brand name toothbrushes on sale)

It's not that the margin saved by going direct can be used for marketing. It is that that margin must be used for marketing, sales, etc. because they have no partner doing it for them. The retailer would in normal cases handle that. DTC isn't necessarily better or worse, just different.

> You can do interesting things with products when you remove some of the vast middle-men distributors that sit between you and the customer and reclaim margin.

This is why I'm starting to love Alibaba. I used to buy composite hockey sticks at the local retailer. Over the years, the tech has gotten better, but the pricing and the gimmicks have increased to where now a stick is in the $200-$250 range.

I started contacting carbon fibre manufacturers on Alibaba from China last year. I did my due diligence and found a manufacturer who sold me comparable sticks for around $100. I pick the length, the flex, the blade pattern and they're 400g, the same weight as my high end retail sticks. I wasn't expecting much tbh, but they've held up really well and have had a consistent feel over the past year and have taken quite a bit of abuse without breaking. By comparison, I went through three retail sticks over the same time last year.

Even with the $50-$60 in shipping they charged me, two sticks cost me $196. It made me think about all the markup I just cut out of the equation by working with the manufacturers directly.

> The margin saved by removing some of the middle-men, can then be used for distribution-marketing-sales to reach out to customers in order to breach that comfortable group monopoly.

Kinda. If there is no natural market per se (i.e., you have to use marketing dollars to convince consumers they not only want Product X but __need__ it) then you're going to need __a lot__ of money. Coke / Pepsi money. Verizon / Comcast money.

Sure. WP is a wonderful story. Everyone loves it. It feels good. Or maybe it was just luck / timing? Maybe the traditional players then were slow and blind? Is that still the case today? Or are those opportunities dwindling? Quickly?

I suspect the latter.

In the WP case there was essentially a monopoly (Luxotica). As a monopoly they had built in additional profit and limitations that gave WP more room to work. It was definitely a broken market. Traditional competitors like Oakley were killed by Luxotica stores simply refusing to carry their brands and then buying the company when the stock sank. The "disruptive" delivery was needed to be a viable competitor.

You really need a special market to make DTC super compelling. I think the elements are:

* High margins

* Repeat purchases

* Low competitiveness

For those, glasses, razors, mattresses all hit at least 2 of 3. I wonder why nobody has done DTC with... say shoes? Probably too much competition.

As mentioned in the article https://www.allbirds.com/

Have a few friends who won't stop talking about them.

There are niche players with a particular pitch. Xero for example. (You could argue that Nike is partly DTC in that they have their own retail stores.)

In a lot of cases though, consumers want to go into a store that carries a bunch of different brands so that they can compare. Or, if shopping online, pick even multiple shoes from Zappos, try them, and return the rest.

I'm not sure that shoes really fulfill any of those elements. There's probably a 4th category which is a niche/cult. Of course, that's a model for a "lifestyle business" not a silicon valley startup that is trying to scale and "disrupt."

There's a crap ton of DTC shoes: https://www.gq.com/gallery/direct-to-consumer-shoe-brands-fo...

Paul Evans has tons of NYC subway ads

There's some good-looking stuff and maybe some aspects are appealing to higher-end customers but to me, shopping online for something like shoes is more about price. I don't see them beating Johnston & Murphy which has comparable or better prices and has physical stores.

Lots have and most have failed. One of the problems with shoes is inconsistent sizing and the way women seem to want to try on 100 shoes before buying a pair.

You didn't phrase your comment obliquely enough apparently :-) But, yes, shoe fit and sizing can be really tricky. I've gone back and forth between shoes in a store a half-dozen times. And where shoes are a fashion accessory like jewelry, it's tricky to order online even if you can send a few things back. You can definitely get more hands-on in a store than you can online even with a generous return policy.

And I know I've gotten stuff that was maybe not quite right but not bad. So I never returned. But I never wore much either.

From TFA: "To one frequent DTC investor I spoke with, though, any young DTC company's moving into retail early in its lifecycle is a red flag that it might be overspending on online marketing. 'Because if it's working online, why all the retail stores? Why not stay online and scale over time? I could see one or two stores as PR plays, but why take on all the overhead, the cost of the build-out?'"

The answer?

Customers have a severe lack of imagination.

I've found this in several different fields, even among smart customers (except those whose expertise is in the area of what you're selling) -- you really have to show and let them see and feel what they're going to get.

Once they've seen it, they'll go online for a better price, but using permanent locations, popup stores, or other IRL interactions could be key for many of these DTC startups.

Seems silly to judge on that considering brick and mortar is still like 85% of retail sales.

Permanent locations are crucial for a lot of different consumers for a lot of different products (especially fashion). I buy clothes way more living in NYC than I ever did when I was living in a rural area because of the local choices.

Why is it that some small high growth companies in non-tech industries get tech-type valuations and prestige, while others do not?

It feels like companies like Warby Parker can use a certain style for people to think they’re super innovative- when in reality they’re just normal boring delivery/sunglasses/sheets/etc with none of the characteristics of real tech companies.

>with none of the characteristics of real tech companies

You mean they sell an actual product?

OK. That's glib. But it's often not clear what many "real tech companies" are actually selling that has consumer value at the end of the day. At least sunglasses and sheets are something that people value and use.

I'm mainly thinking many companies in the tech industry can earn huge profits due to (1) It's easier for software companies to achieve huge global scale than physical companies and (2) Potentially amazing economics. Marketplaces, network effects and high fixed low variable costs = Winner take most.

The sunglass/sheet/etc market is not winner take most.

I dont its glib at all. And I agree with you.

The notion of a "startup" is all marketing and message anyway.

Off-topic, but I’m really curious where the jury stands on the Ombraz Kickstarter. They make these sunglasses with a strap instead of arms. So far when I’ve showed them to people, I’ve gotten extremely mixed responses.

https://ombraz.com (I am not affiliated.)

I'm not sure why I wouldn't get normal glasses and a good Chums strap for them. I suppose these are theoretically more secure but I've flipped while kayaking and I've never had trouble losing glasses so long as I had a retainer.

The idea is interesting on paper but a good retainer strap seems a lot more versatile.

There is nothing on earth that would convince me that my toothbrush is an extension of myself. Nothing.

Most of the DTC stories I hear seem to be very US-centric, including most of the companies mentioned in this article. What are successful DTC companies coming from outside of US?

Most of them will probably fail. Still, I thank them for funding my favorite podcasts.

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