The 550 layoffs announced at Wayfair on Thursday might have you wondering about the company that’s been called Boston’s fastest growing tech firm.
Here’s a quick primer on the history of Wayfair, an online retailer that sells couches, lamps, cat condos, and other home furnishings.
1] How it all started -- The company that would later become Wayfair was launched in a spare bedroom of cofounder Steve Conine’s Boston home in 2002. Conine and cofounder Niraj Shah met at a math and engineering camp in high school, then ended up in the same dorm as freshmen at Cornell University.
After college, they started two digital businesses before launching their first online store, a site that supplied furniture for stereo equipment that they called racksandstands.com. Eventually, their company, CSN Stores, would run a constellation of some 250 housewares sites that shipped orders directly from suppliers.
Nearly a decade in, CSN was doing $500 million in sales with zero inventory or outside investment. But Conine and Shah realized they needed a single brand if they wanted to go toe-to-toe with Walmart, Target, or Home Depot. So in 2011, the duo consolidated everygrandfatherclock.com, allroosterdecor.com, and scores of other sites under one simple name: Wayfair.com.
2] Early success -- Wayfair’s stock has made Conine and cofounder Niraj Shah billionaires.
“Over the first 10 years, we went from bootstrapping to going to half-a-billion dollars in sales,” Shah told the Globe in 2018. “But we knew we wanted to build a nationally known mass retailer.”
3] Profit problems -- Wayfair has still failed to turn a profit. Its executives have long argued that despite a long track record of losses, the company has been in growth mode, investing heavily in its supply chain infrastructure and European expansion efforts. More often than not, its board members and leadership team will point to Amazon as their model, which for years funneled its revenues back into growth and failed to turn a profit.
4] Big (big) workforce -- Wayfair’s been on such a hiring blitz over the past several years that its employees have been known to wait in line for the escalators up to its offices in the Copley Place mall, the Globe has reported. The company, which expanded into a second office building last summer, now employs 17,000 people worldwide selling furniture and home decor.
5] Thinking outside the box -- The Globe reported in 2018 that Wayfair built technology to allow customers to upload photos — of a green velvet sofa, for example — to find similar ones, and its augmented reality and virtual reality tools render furniture in 3-D or let a customer see how a love seat will fit in the living room.
“When you walk around the halls of Wayfair, to me it feels like you’re walking around the halls of McKinsey or Boston Consulting — the aptitude of the people around you is at that level,” Neeraj Agrawal, whose firm Battery Ventures invested $40 million in Wayfair in 2011, told the Globe in 2018. “They hired almost nobody from the furniture world; they look for raw aptitude. It always goes back to: ‘What is the data telling us?”