Andy Dunn, Bonobos, and Marc Lore, Walmart / Jet.

Congratulations to Bonobos and Jet.

A pioneer in ecommerce joins forces with a leader in retail, and makes my ass look good!

I met Andy Dunn in late 2010 as a favor to a friend. I was a happy customer of Bonobos*, but I couldn’t see how a company making men’s pants could ever be a venture investment. At that time, ecommerce meant companies like Amazon, retailers selling products from many manufacturers and brands. There were virtually no Digitally Native Vertical Brands (a term coined by Andy) and Bonobos was pioneering a category.

Today most ecommerce startups are DNVBs because of the superior economics of vertical supply chain integration — margins are typically twice that of a standalone retailer. Warby Parker, Dollar Shave Club, Casper, Honest*, Glossier; all have followed the path blazed by Bonobos.

In that very first meeting, Andy changed my mind with his unique insights. He showed me the margin potential of DNVBs. He talked about how fit was a differentiator for mens apparel that was open for innovation. He proved how Bonobos had built new habits for its customers, with strong spaghetti charts demonstrating long life time values. And he demonstrated how men and women shop differently (see his “formula” below showing how men and women weigh the same attributes differently in their purchase decisions).

But the most important thing that he did to change my mind was to be Andy Dunn. Andy is a force of nature. A true entrepreneur; relentless, creative, optimistic, charismatic and brilliant. Cocky, true, but incredibly self aware. I believed in Bonobos because I believed in Andy.

Luckily for me, I wore a pair of (pale pink corduroy) Bonobos to that first meeting, and that was one of the reasons that Andy chose Lightspeed to co-lead the first institutional investment in Bonobos.

It has proved to be a very fruitful investment. The company grew by delighting its customers with fit, energy and service. It is 15x larger than when we invested. Today is the end of our journey with Bonobos, but far from the end of the Bonobos journey. Bonobos is joining the Jet family, and will continue to grow under that umbrella, with the resources of a mighty company behind it.

I am grateful for the amazing work done by the team at Bonobos over the last seven years, by the execution of the executive team, and for the vision and leadership of Andy. Thank you for letting Lightspeed come along on the ride. Thank you for making my ass look good!

* Bonobos and Honest are Lightspeed portfolio companies.


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