How WatchBox got Michael Jordan on board for $165M funding round – Philadelphia Business Journal – Philadelphia Business Journal

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WatchBox CEO Justin Reis says putting together a $165 million investment from Wall Street titans and big-name athletes like Michael Jordan and Giannis Antetokounmpo isn’t science. It’s a result of relationships. 
The Bala Cynwyd luxury watch reseller on Tuesday announced the funding round led by investment firm The Radcliff Cos. and hedge fund The Spruce House Partnership. Additional backers include the NBA’s Chris Paul, Devin Booker and Karl Anthony Towns, as well as NFL Hall of Famer and TV personality Michael Strahan.
WatchBox wasn’t seeking investors who were famous, but rather avid watch collectors who were already customers, Reis said. Jordan was introduced by his business partner, Curtis Polk, and Antetokounmpo and Milwaukee Bucks owner Marc Lasry were both brought in by a mutual friend who knew that they were watch collectors, Reis said.
“The referral was so valuable,” he said. “One investor speaks to another athlete, speaks to another entrepreneur, and before you know it, you’ve really got this microcosm of a great network of people that are willing to help and invest.”
Other investors include billionaire Bill Ackman, who runs hedge fund Pershing Square Capital Management.
WatchBox began raising the investment round over the summer, and the network effect accelerated over a three- to six-week period. Reis initially sought to raise $100 million, but ended up factoring in additional demand to bring the round up to $165 million. Investors actually wanted to put more money into the startup. The company downsized capital commitment because it didn’t want to “dilute unnecessarily” at that time, Reis said.
Reis declined to share WatchBox’s valuation. The latest cash infusion puts WatchBox’s evaluation at just under $1 billion, CNBC reported.
WatchBox isn’t looking to raise additional capital in the short term, but an initial public offering isn’t out of the question, Reis said. 
“We’re always looking at the IPO markets when they make sense,” he said. “But I think there’s so much growth opportunity that we’re able to execute upon first, and I would want to make sure we get our heads down and focus on that before we go to market.”
WatchBox was founded in 2017 as a spinoff from 105-year-old Govberg Jewelers, a family-run jewelry store started in Philadelphia on Jewelers’ Row. The company is projecting $300 million in revenue for 2021.
The startup will use the money to invest in its technology platform, building out more features to connect potential customers with the startup’s sales team and scaling up the platform so the company can enter new international markets. Reis wants to build “hyper-personalized” relationships with customers through its tech platform, especially those customers who may not be close to one of WatchBox’s retail locations.
“With investment in the technology, it will allow us to run faster, scale more quickly and essentially address a wider audience of customers more efficiently,” Reis said.
The cash infusion will also facilitate the company expanding its brick-and-mortar presence from five stores to 13. WatchBox currently has retail stores at its headquarters in Bala Cynwyd, as well as in Hong Kong, Switzerland, Singapore and Dubai. 
WatchBox plans to open eight new stores around the world in New York, Los Angeles, Miami, Houston and Dallas, as well as Zurich, Switzerland; Riyadh, Saudi Arabia and Tokyo.
The third prong of the investment will go toward expanding WatchBox’s inventory. The startup already values its collection of timepieces at about $150 million. Reis said the company will invest in collections of “curated inventory” to reach a larger customer base.
Reis plans to keep WatchBox at its Bala Cynwyd headquarters, even as it inches closer to unicorn status. 
“We love it. It’s like this hidden gem in a quiet neighborhood, and we love the fact that we’re running one of the larger e-commerce luxury platforms from Bala Cynwyd, and no one knows where it is,” Reis said. “We’re very proud of where we are.”
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