Gemvara Inc., the Boston startup that sells jewelry online, has been bought by a division of Berkshire Hathaway Inc., the holding company headed by billionaire investor Warren Buffett.
Berkshire Hathaway’s Richline Group, a major supplier of jewelry to retailers in the United States, plans to hire more workers at Gemvara as it attempts to grow its footprint in the online sector, spokesman Mark Hanna said.
Richline declined to disclose the purchase price.
Gemvara, founded by Babson College students in 2006, allowed shoppers to customize their baubles online. Venture capitalists invested more than $60 million in the company, including a $12 million round of financing in 2014.
But the startup had difficulty growing. It churned through four chief executives, with cofounder Matt Lauzon holding the job twice. Gemvara once grew to about 80 employees at its New York and Boston offices, but was forced to lay off workers as it tried to find a sustainable business.
Last year, with about 55 employees on board, CEO Matt Nichols thought he’d found a way forward with a new service focused on resetting customers’ existing gemstones.
Gemvara poured most of its efforts into growing the resetting business, essentially putting its previous online shopping sites on auto-pilot. About halfway through 2015, Nichols said the company was on pace for about $20 million in annual sales, although it wasn’t profitable.
The acquisition could revive the customizable jewelry service, with Richline touting Gemvara’s “world-class e-commerce platform and customization technology” in its announcement of the deal.
“Partly, we were always jealous of what they were able to accomplish on a personalized, specialized basis that we didn’t have. It was a part of the business that our company really didn’t touch,” Hanna said. “We’re much more mass-produced, large retailers, large national accounts.”
Nichols was not immediately available for comment. The news was first reported by BostInno, which also said Gemvara had conducted a limited number of layoffs in redundant positions.
Online sales are still a small slice of overall jewelry retail in the United States. Publicly traded Blue Nile Inc. “dominates this field,” but its $473.5 million in sales represented less than 1 percent of the total jewelry market in 2014, industry analyst Edahn Golan reported.
Richline employs about 3,700 worldwide. Its largest manufacturing facility is the LeachGarner factory in Attleboro, which employs more than 600, Hanna said.