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09/01/2021

Brilliant Earth is latest retailer looking to go public

Marianne Wilson
Editor-in-Chief
Marianne Wilson profile picture
Brilliant Earth store
Brilliant Earth operates 13 brick-and-mortar locations, with more in the works.

Brilliant Earth Group has filed for an initial public offering after successful 2020.

The DTC jewelry company, which is focused on ethical sourcing of gemstones, listed the size of the offering as $100 million, a placeholder that will change when terms of the share sale are set. (The proposed offering will be made only by means of a prospectus.) Brilliant Earth has applied to list its common stock on the Nasdaq under the ticker symbol “BRLT.”

Brilliant Earth’s filing came the day after another digitally native company, Allbirds, filed for its own IPO. The two announcements occur during what is already a record year for U.S. listings, which shows no signs of stopping as companies rush to go public in the final months of 2021, reported Bloomberg.  Including special purpose acquisition companies, IPOs on U.S. exchanges have raised a combined total of more than $241 billion since Jan. 1, according to Bloomberg.

Founded online in 2005, Brilliant Earth targets millennial and GenZ consumers. Through its “create your own” model, customers can choose their engagement ring design, precious metal type and ring size, and select their diamond or gemstone from the company’s marketplace. Over two-thirds of its ring collection is available exclusively at Brilliant Earth.

The company said that it has served 370,000 customers through its e-commerce platform and 13 brick-and-mortar showrooms. Additional locations are in the works, including Austin and Dallas and its first location in New York City.  The outposts operate on an appointment-based, inventory light model that offers one-on-one personalized interaction that integrates with the company’s online experience.

“Because our showrooms serve as destinations with some customers traveling long distances to visit them, we believe that we can achieve near-national showroom coverage with under 100 locations,” the company stated in documents filed with the Securities and Exchange Commission. “We expect this highly efficient showroom model to complement our digital strategy and continue to drive growth and profitability.”

Brilliant Earth had net sales of $251.8 million in 2020, compared to $201.3 million in 2019,

Net income totaled $21.6 million, compared to a loss of $7.8 million in 2019. For the first half of this year, sales were up 77.7% to $163, with net income of $10.9 million.

“Our financial model is compelling: high net sales growth, substantial first order profitability, and attractive margins,” the company stated. “We are very capital efficient: Our made-to-order capabilities and virtual inventory model generate attractive inventory turns and negative working capital. Our performance in the first half of 2021 continues to demonstrate our ability to succeed in this market.”