Bonobos (apparel)

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Bonobos
Subsidiary
IndustryRetail, apparel, e-commerce
Founded2007
FoundersAndy Dunn and Brian Spaly
HeadquartersNew York City
Number of locations
48 (as of January 2018)
ParentWalmart (2017-present)
Websitebonobos.com

Bonobos is an e-commerce-driven apparel subsidiary of Walmart headquartered in New York City that designs and sells men's clothing. The store has a specific emphasis on the sale of men's suits, trousers, denim, shirts, shorts, swimwear, outerwear and accessories. The company was founded by Stanford Business School students Andy Dunn and Brian Spaly, and launched as an exclusively online retailer in 2007.

In 2012, Bonobos diversified to incorporate physical retail locations with the launch of their “Guideshop" locations,[1] as well as through a partnership with fellow fashion firm Nordstrom.

On 16 June 2017, Walmart agreed to acquire Bonobos for the sum of $310 million, making it a subsidiary within its fashion department.[2][3][4] The acquisition, which coincided with Amazon's acquisition of Whole Foods Market, saw Walmart shares drop by 6%.

History[edit]

The firm was founded by Brian Spaly who began designing men’s pants while at Stanford Business School. They featured a curved waistband, a medium rise and a tailored thigh that fit better and eliminated “khaki diaper butt.”[5] As demand grew, he and housemate Andy Dunn decided to pursue the project as a business opportunity.[6]

Initially, the brand was launched exclusively online.[7] Dunn cashed in his 401(k) to build Bonobos.com and raised a round of angel investment. Initial investors included Wealthfront CEO and former venture capitalist, Andy Rachleff, and JetBlue Chairman and founding Bonobos board member Joel Peterson, both of whom had lectured Dunn at Stanford Business School. Dunn then moved to New York City with 400 pairs of pants that he picked, packed and shipped from his Union Square apartment.[8] Within six months, the firm grew to five employees and a $1 million net revenue run rate. In its first three years, the company received over $7 million in funding from angel investors. In 2009, Spaly moved on to another venture, running the Chicago-based fashion commerce company Trunk Club.

In 2010, the company received its first institutionally-driven financing round, raising $18.5 million from Accel Partners and Lightspeed Venture Partners. As part of the round, Accel Partners’ Sameer Gandhi and Lightspeed Venture Partners’ Jeremy Liew joined Bonobos’ board.[9]

As Bonobos expanded its assortment to include suits, dress shirts, outerwear and tailored pieces, more customers requested the opportunity to “try before they buy”. In fall 2011, the company tested an e-commerce store at their New York City headquarters, calling the location a Guideshop.[10] The purpose of the Guideshop location was to provide a physical space for men to try on Bonobos prior to e-commerce transactions being placed. Within a year, the concept became an integral part of the firm's service and business model.[11]

In 2012, Bonobos closed a $16.4 million strategic minority investment round led by Nordstrom,[12] with participation from existing investors. In tandem, Bonobos partnered with Nordstrom[13] to sell the brand’s clothing in their full-line stores and their website. Bonobos furthered its offline reach in May 2012, opening its first standalone Guideshop location in Boston.[14] By January 2013, Bonobos had opened additional Guideshop locations in Chicago,[15] Georgetown[16] and San Francisco.[17]

Bonobos announced a $30 million round in 2013, with Glynn Capital and Mousse Partners joining existing investors Accel Partners, Lightspeed Venture Partners, Forerunner Ventures and Nordstrom. At this time, Forerunner’s Managing Partner Kirsten Green joined the Bonobos board and total funding to date reached nearly $73 million.[18] Simultaneously, the company launched the golf brand Maide,[19] which is the second brand launched by the Bonobos team. By August 2013, Bonobos had opened Guideshop locations on Crosby Street[20] in New York City, Bethesda, MD,[21] and Austin, TX,[22] bringing total location count to eight. By August 2013 employee headcount reached 175.

In June 2017, Walmart announced it was purchasing the brand for $310 million in cash. The brand will not be sold in the Walmart stores, instead it will be sold on Walmart's recently purchased Jet.com. Bonobos CEO Andy Dunn remained with the company after the purchase.[23]

Operations[edit]

Bonobos "Ninjas" are a team of customer service representatives tasked with providing quality customer service for the company’s e-commerce site.[24] Dunn conceptualized the name to attract college-educated qualified candidates to the job and to emphasize Bonobos’ desire to provide great customer service.[25] Bonobos Ninjas interact with customers through phone, email, chat, and social media.

It has been covered in national publications such as The New York Times,[26] USA Today,[10] CNBC, The Boston Globe,[27] Chicago Sun Times,[28] San Francisco Chronicle,[29] among others.

Technology[edit]

In early 2012, Bonobos opened a West Coast office to build a Silicon Valley-based technology team, in an effort to expand its nationwide retail presence.[30] Following 18 months, the firm attempted to minimise inefficiencies by eliminating bi-coastal offices, which were then redundant. Hence, in 2013, Bonobos relocated the technology arm to its New York City headquarters.[31]

References[edit]

  1. ^ Clifford, Stephanie (18 December 2012). "Once Proudly Web Only, Shopping Sites Hang Out Real Shingles". The New York Times. Retrieved 18 July 2013.
  2. ^ Walmart Bonobos Merger nytimes.com 2017/06/16
  3. ^ Walmart to Acquire Bonobos and Appoint Andy Dunn to Oversee Exclusive Consumer Brands Offered Online businesswire.com June 16, 2017
  4. ^ ANNE D'INNOCENZIO, Walmart to acquire online men's clothing retailer Bonobos The Associated Press JUNE 16, 2017
  5. ^ Machan, Dyan (November 2008). "By the Seat of Their Pants" (PDF). SmartMoney. Retrieved 18 July 2013.
  6. ^ "Crain's 40 Under Forty". Crain's New York. Retrieved 18 July 2013.
  7. ^ "Roommates Start a Pants Company". The Today Show (NBC). Retrieved 18 July 2013.
  8. ^ "Bonobos CEO: Men are not 'boxy'". Bloomberg TV. Retrieved 18 July 2013.
  9. ^ Wei, William. "The Story Of Bonobos: Turning Good-Looking Pants Into A $15 Million Company In Three Years". Business Insider. Retrieved 18 July 2013.
  10. ^ a b St.John, Oliver (March 12, 2013). "Bonobos opens stores that don't sell anything". USA Today. Retrieved July 19, 2013.
  11. ^ "Bonobos Guideshop- San Francisco". Yelp. Retrieved 19 July 2013.
  12. ^ Rusli, Evelyn (11 April 2012). "Stores Go Online to Find a Perfect Fit". New York Times. Retrieved 19 July 2013.
  13. ^ "Bonobos and Nordstrom Announce Partnership: Customer Centric E-tailer Moves Offline with Retail Service Pioneer". PR Newswire. 12 April 2012. Retrieved 19 July 2013.
  14. ^ Abelson, Jenn (6 October 2012). "Clothing stores court men with free beer, big-screen TVs". The Boston Globe. Retrieved 19 July 2013.
  15. ^ Hatch, Jared. "Andy Dunn Opens Permanent Bonobos Guideshop on Armitage". Racked. Retrieved 19 July 2013.
  16. ^ Moroz Alpert, Yelena (27 March 2013). "Wedding Style: Don't Forget the Men". Washingtonian. Retrieved 19 July 2013.
  17. ^ Durbin, Samantha (30 January 2013). "Bonobos' San Francisco Guideshop Now Open For Personal Shopping Business". 7x7 San Francisco. Retrieved 19 July 2013.
  18. ^ Lacy, Sarah. "Nice pants: Bonobos raises $30m off of strong growth and Nordstrom deal". PandoDaily. Retrieved 19 July 2013.
  19. ^ Auclair, T.J. "Bonobos launches Maide Golf, a hip, new apparel line". PGA. Retrieved 19 July 2013.
  20. ^ Berlinger, Max (15 May 2013). "SHOP ONLINE RETAILER BONOBOS IRL IN NYC". Esquire Magazine. Retrieved 19 July 2013.
  21. ^ Kraut, Aaron. "Bonobos Opening July 20 On Bethesda Row". Bethesda Now. Retrieved 2 August 2013.
  22. ^ Calnan, Christopher (Jul 26, 2013). "Bonobos going 'clicks to bricks' in Austin". Austin Business Journal. Retrieved 2 August 2013.
  23. ^ Valinsky, Jordan (2017-06-16). "Walmart is buying Bonobos for $310 million". CNNMoney. Retrieved 2017-06-16.
  24. ^ Olles, Rebecca (November 27, 2011). "Gotham Gigs: Bonobos' head 'ninja' is a master of service". Crain's New York. Retrieved 29 July 2013.
  25. ^ Unknown. "Help Wanted: Only Ninjas Need Apply: Bonobos". New York Enterprise Report. Retrieved 29 July 2013.
  26. ^ Clifford, Stephanie (18 December 2012). "Once Proudly Web Only, Shopping Sites Hang Out Real Shingles". New York Times. Retrieved 19 July 2013.
  27. ^ Muther, Christopher (24 May 2012). "New era of better-fitting men's clothes in Boston". The Boston Globe. Retrieved 19 July 2013.
  28. ^ Each, Molly (30 Oct 2012). "MEN'S SHOPPING MADE EASY". Chicago Sun Times. Retrieved 19 July 2013.
  29. ^ Sanders, Lorraine (1 October 2012). "Bonobos Guideshop". San Francisco Chronicle. Retrieved 19 July 2013.
  30. ^ Biggs, John. "Clothing Brand Bonobos Snags Netflix Director Of Engineering". TechCrunch.com. Retrieved 29 July 2013.
  31. ^ Crook, Jordan. "Bonobos' SF Engineers Split Between NY Relocation And New Company Led By CTO Mike Hart". TechCrunch.com. Retrieved 29 July 2013.