The parent company of BarkBox, the subscription service for dog products, is gearing up to launch an initial public offering (IPO) in the next six months.
According to news from CNBC, citing Bark co-founder and chief executive Matt Meeker, the company would also consider a sale of the company. Sources familiar with the situation told CNBC that BarkBox met with investment banks in recent weeks to discuss both an IPO and a sale. The company confirmed it had meetings with bankers but said talks at this stage are normal in order to network and take a pulse of the marketplace.
The report noted that, since the decline of Blue Apron after going public, companies have been shying away from calling themselves subscription box services, but Bark welcomes the label. “There are consumer subscription companies that have different dynamics,” said Meeker. “Costco is the gold standard of that … Let’s be upfront about it: Here is our annual retention rate; here is our cash. Because they are good, so let’s just tell everybody it.”
By the end of this year, Bark aims to have a revenue of more than $150 million and to hit $250 million in revenue by the end of 2018. Currently, the company has 500,000 subscribers and a retention rate of 95 percent. Bark has raised a total of $77 million in funding.
When asked about Amazon, Meeker said he views the eCommerce giant as both a friend and foe. He can see BarkBox partnering with Amazon, but says their focus would most likely be on pet food, rather than treats and toys.
“IPO investors will be interested in a company that has that growth and is profitable,” said Kathleen Smith, a principal at Renaissance Capital, which manages IPO-focused, exchange-traded funds. “They will be pushing on issues that others have had though: logistics, the need to spend more to get new customers and new competition.”