Online diamonds wholesaler and retailer R2Net raises $25 million
December 19, 2014 04:23 PM
R2Net LLC, an online wholesaler and retailer of bridal jewelry and loose diamonds, put a new shine on its growth strategy this week with its announcement that it raised $25 million in outside funding.
The company, which operates a business-to-business online platform for wholesaling diamond jewelry to retailers, also operates its own retail operation at JamesAllen.com. James Allen, which recently started selling jewelry through boutiques in some stores operated by Sears Holdings Corp., is No. 234 in the Internet Retailer 2014 Top 500 Guide, which ranks merchants on their annual web sales. Sears is No. 5.
R2Net says it will use the new funding to continue its strategy of growing both its wholesale and retail markets. The funding is from Israel Growth Partners, a private equity investment firm, whose principals Moshe Lichtman and Haim Shani have joined R2Net’s board of directors. “IGP believes that there is a unique strategic opportunity to better serve the entire diamond industry’s ecosystem and to deliver significant value across the board with R2Net’s technology platforms and capabilities,” Lichtman says.
Oded Edelman, R2Net’s founder and CEO, says IGP’s funding and expertise will help R2Net further develop its strategy of building out R2Net’s capabilities in using technology to improve its ability to sell online. In the past year R2Net has acquired Segoma Inc., a provider of diamond-imaging technology, and Brio Animation Studio Ltd., which provides technology for presented product images through augmented reality. Augmented reality is a technology that embellishes digital images with additional content—for example, making the image of a diamond ring appear on an image of a customer’s finger.
R2Net’s JamesAllen.com retail e-commerce site has been using some of its new digital imaging technology in the boutiques it launched in November in 16 Sears stores in New York, Maryland and Puerto Rico to help encourage customers purchase its jewelry. James Allen keeps a limited number of jewelry pieces on hand in the boutiques for customers to touch and try on, but relies on its e-commerce site to display its full range of products and place orders. Blue Nile Inc., a major competitor of James Allen’s in online jewelry sales and No. 78 in the Top 500 Guide, also operates in-store boutiques with access to its e-commerce site in Nordstrom Inc.’s stores. Nordstrom is No. 24.