The old cliche that luck favors the prepared is tantamount to the physical laws of nature in early stage venture, similar to the “Power Law.” No way to escape either and they both drive success for venture funds. You absolutely need to get fortunate several times in a venture capital career to succeed, but to maximize your chances of picking a great company at the seed or Series A stage, you have to optimize your deal flow quality and your ability to identify “signals” of company breakout before any obvious traction exists.
When we led the Pair Eyewear Series A and I joined the board in early 2021, it was not an “obvious” investment. The company is in the DTC space, which had largely fallen out of favor with investors; the founders were recent graduates, having started the company straight out of Stanford University undergrad; and they were only selling to kids at the time, making their immediate TAM “small”, by venture standards.
But if one avoided the knee jerk reaction all too common in our industry, of dismissing founders and start-ups based on surface level labels or “intro blurb assessment”, peeled back the onion a few layers, one would see that the signals for a transformational and potentially iconic company, were all there from the very beginning.
The co-founders, Nathan Kondamuri and Sophia Edelstein, exhibited all of the qualities we see in successful entrepreneurs: mission driven, inspiring, intellectually honest, decisive, extremely thoughtful and insatiably hungry to learn through mentorship and feedback, and very data driven in their decision making.
Their product at the time was only geared towards children, which by itself is not a big enough market opportunity. But if you looked closer, you would see that many of their product returns were actually adults, buying kids glasses (because they loved the concept and the ability to customize as well!), but had to return them because they just didn’t fit their larger heads. The team seized on the opportunity and planned on launching adult sized frames later that year. A few months, post our Series A investment, Pair’s revenue went from 90% kids to 90% adults buying for themselves, which represented a much bigger market.
Finally, even though DTC has fallen largely out of favor with many VCs, not every DTC company is created equal. Pair’s unique form factor, that allows customers to buy and collect “Top Frames” to customize their look, enables a completely new recurring revenue business model, with best in class unit economics (i.e. gross margin, LTV/CAC, payback period, repeat purchase rate, etc.) within the DTC space. Financially, Pair looks more like a SaaS company than it does a DTC one, which has allowed them to grow quickly, yet efficiently, while other consumer companies have been forced to pull back in a tough macro economic environment.
You can read more about our initial investment thesis here: https://medium.com/javelin-vp/announcing-our-investment-in-pair-633940d9fe4b
We are so proud of everything that Sophia, Nathan, and the entire Pair leadership team have accomplished since our initial investment. After three straight years of monumental growth, major leaps in product and manufacturing innovation, and a new robust capital base highlighted by Prysm Capital, Javelin Venture Partners, New Enterprise Associates (NEA), Norwest Venture Partners, Precursor Ventures, and others, Pair is well positioned in their pursuit of becoming the world’s largest global consumer eyewear brand and we are grateful to be along for the ride!
You can read more about their latest financing round here:
And of course they are hiring!