Episode Details

Why are glasses so expensive?

Dave Gilboa could not stop asking himself that question. After leaving his $700 pair of eyeglasses on an airplane while returning from Southeast Asia, he could not wrap his head around why a technology that was so archaic could cost him more than his iPhone.

Within his first weeks as an MBA student at the Wharton School of Business, he repeatedly brought this question up among some of his new peers. Gilboa, along with fellow students Neil Blumenthal, Andrew Hunt, and Jeff Raider, had all shared in the pain of losing or breaking glasses and had all agreed: the high markup made no sense.

Inspired by Gilboa’s pricey misfortune, the four of them founded Warby Parker. Now led by co-CEOs Gilboa and Blumenthal, the billion-dollar empire with 2,000 employees is revolutionizing the prescription glasses industry by selling stylish eyewear online at affordable prices.

The New York City-based company is also on a mission to combat the global problem of impaired vision through its charitable Buy a Pair, Give a Pair program. Since the company’s start, the program has distributed over 5 million pairs of glasses to those in need by donating a pair of glasses for every one sold.

But long before they could build an ecommerce giant, the team would first have to learn how to even build a website.

Prior to going to Wharton, all four co-founders had already spent some considerable time in the workforce. This allowed for each of them to gain valuable real-world experience, and it helped guide them to understanding if they had an actual problem to solve and a business to move forward with.

However, it was Blumenthal’s experience while running the nonprofit VisionSpring that would become crucial to the early concept of Warby Parker. During his time with the company, they trained low-income women in the developing world to start their own businesses. Participants were to take their new skillsets back to their rural communities and administer vision screenings and sell glasses. But it was something else Blumenthal had witnessed that would have a lasting impression on him.

“I had been to the factories,” Blumenthal says. “Here I was producing glasses for people who were making less than four dollars a day, but 10 feet away were factories that were producing…the $700 pair of glasses Dave had. So we knew something was awry.”

A light bulb went off and the classmates soon pulled together $120,000 and went to work on developing Warby Parker in 2008. The problem they wanted to solve: How can we make glasses we want, but at a low cost?

Eager to launch, but more focused on preparation and planning, the founders began sketching out all the main aspects of the company. With limited funding, they knew they’d have to really refine and plan each facet of their business before revealing it to the public. Their first steps were to design glasses that they’d want to wear and then find a manufacturer who could produce them for less, starting with Blumenthal’s connections.

The next step would be trying to figure out how to sell their glasses directly to the consumer. The answer was simple.

“This magical thing called the internet,” Blumenthal says.

The founders all knew that ecommerce was an innovation they wanted to take advantage of for their direct-to-consumer brand. Had they come up with this idea 10 years prior, the company may not have gone any further than an idea. With a brick-and-mortar store requiring a lease, utilities, and other costs, they knew it would be hard to make their new dream a reality with limited capital.

“If we did , we would have one location that we might be able to attract some local customers, but with the power of the internet, we were able to all of a sudden, launch