Chewy (company)

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This article is about the pet food retailer. For other uses, see Chewy (disambiguation).

Chewy, Inc.
TypePublic
NYSE: CHWY (Class A)
IndustryE-commerce
GenrePet supplies
Founded2011
Founders
Headquarters
Dania Beach, Florida
,
U.S.
Area served
United States
Key people
  • Sumit Singh (CEO)
  • Mario Marte (CFO)
  • Satish Mehta (CTO)
[1]
ProductsPet food and pet-related products
RevenueIncrease US$7.1 billion (2021)[2]
Increase US$−92.5 million (2021)[2]
Total assetsIncrease US$1.7 billion (2021)[2]
OwnerPetSmart (63.5%)
Number of employees
18,500 (2021)[2]
Websitechewy.com

Chewy, Inc. is an American online retailer of pet food and other pet-related products based in Dania Beach, Florida. In 2017, Chewy was acquired by PetSmart for $3.35 billion, which was the largest ever acquisition of an e-commerce business at the time.[3] The company completed its initial public offering in 2019, raising $1 billion.[4]

History[]

2011-2019: Founding and pre-IPO[]

Chewy was founded under the name "Mr. Chewy" in June 2011 by Ryan Cohen and Michael Day.[5][6][7][8][9] The company hired former employees and executives from Amazon, PetSmart, Whole Foods Market, and Wayfair.[7] In March 2012, the company estimated a total yearly revenue of $26 million, despite losing money in its first half year.[8][5] From 2014 to 2015, sales grew from $205 million to $423 million.[10]

By 2017, the company had revenue of approximately $2 billion and 51% of online pet food sales in the US.[11][12] At that time, Ryan Cohen prepared to take Chewy public as both Petco and PetSmart approached with merger offers.[13] Petco's offer would be paid for in part using stock, whereas PetSmart offered an all-cash bid that would also allow Chewy to remain a completely separate business.[14] Chewy was acquired by PetSmart in May 2017 for $3.35 billion, which at the time was the largest ever acquisition of an e-commerce business.[15] PetSmart later transferred 20% of its ownership stake in Chewy to private equity firm BC Partners, which has owned PetSmart since 2014, and also spun off an additional 16.5% of Chewy to an unrestricted subsidiary in 2018.[16]

Following the acquisition, Cohen remained CEO and operated the business largely as an independent unit of PetSmart.[17] Between 2017 and 2018, Chewy’s sales increased from $2.1 billion to $3.5 billion,[18] with 66% of sales coming from customers signed up for automatic recurring shipments.[14] In 2018, Chewy created Chewy Pharmacy, an online pharmacy providing pet-targeted prescription medications.[19] Orders placed through the business are completed in coordination with a team of in-house veterinarians.[20]

2019-present: Post-IPO[]

On April 29, 2019, Chewy filed an S-1 for an initial public offering, intending to trade under the ticker symbol CHWY. In its filing, Chewy reported a net loss of $268 million on total sales of $3.5 billion for its 2018 fiscal year.[21] Chewy went public on June 14, 2019, at $22 per share.[22] In the 2019 fiscal year, Chewy earned net sales of $4.85 billion, a 40 percent year-over-year increase on a 52-week to 52-week basis. The company saw increased demand from millions of existing and new customers as the business sustained growth throughout the economic disruption of the COVID-19 era.[23][24]

That same month, Chewy launched a free tele-triage service called Connect With a Vet.[25] In November 2020, Chewy announced that it would produce and fulfill orders of customized prescription medications, commonly referred to as compounding, for instances where commercial alternatives are absent.[26] In 2020, it was announced that PetSmart and Chewy would be separated by private equity firm BC Partners Inc. in a recapitalization plan; the process began in early 2021.[27][28] In 2020, total yearly net sales increased 47% to $7.15 billion from 2019 sales.[29][30]

In March 2021, Chewy reported revenue of $2.04 billion for Q4 of 2020, and net sales of $7.15 billion for the fiscal year.[31]

In December 2021, Chewy announced a partnership with Trupanion, beginning in the spring of 2022, offering pet health and wellness plans to its customers.[32][33]

Awards[]

Chewy was named a "Top 10 Employer Brand" in Boston in both 2019 and 2020. The company also received recognition from Newsweek for "America's Best Customer Service" for three consecutive years from 2019 through 2021, as well as Ad Age's distinction as one of "America’s 20 Hottest Brands 2020," and Comparably's 2020 top rankings for Best Company Culture and Best Companies for Women. Chewy was also recognized in Comparably's 2021 top rankings for Best Company Outlook, Best Product & Design and Best Engineering teams.[34][35][36][37][38]

Corporate affairs[]

The company's founder and first CEO, Ryan Cohen, stated that he used Jeff Bezos's 1997 letter to shareholders as a roadmap for how to grow Chewy by using Amazon's guidelines on the convenience of shopping online and customer service.[39] Cohen stepped down in March 2018,[40] and Sumit Singh was named the company's CEO in March 2018 after working as its COO since 2017 and previously as an executive at Dell and Amazon.[41][42][43][44] Singh led the company through its IPO; Chewy grew to a market capitalization of $40 billion. Sumit was subsequently named in 2020 to the Bloomberg 50 and Comparably's Best CEOs list.[30][45] The company reported to have employed around 7,000 people in the United States in 2018 and more than 12,000 by 2019.[4][46] The company has more than 18,000 employees in the United States as of 2021.[47]

Locations[]

Chewy was founded in Dania Beach, Florida, outside Fort Lauderdale.[4] The company opened a facility in Mechanicsburg, Pennsylvania to allow for overnight delivery in the Northeast in 2014.[10] In 2017, Chewy announced that it would open an office in Boston, Massachusetts, which the company called its second headquarters.[48] In February 2018, Chewy opened a new customer service center in Hollywood, Florida.[49] Also in 2018, Chewy.com opened a new distribution facility in Goodyear, Arizona.[50] It has 12 fulfillment centers and three customer service centers.[51] In October 2020, the company launched its first fully automated distribution center.[52]

Funding[]

In 2016, Chewy received $236 million in venture capital financing over five rounds.[53][54][55] As of 2019 the company was valued at $10.2 billion.[56]

References[]

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  2. ^ a b c d "Chewy Announces Fiscal Fourth Quarter and Full Year 2020 Financial Results". investor.chewy.com.
  3. ^ Emily Canal, "Meet the Young Founders of Chewy.com, Which PetSmart Just Bought for $3.35 Billion," Inc., April 19, 2017.
  4. ^ a b c Chesto, Jon (December 25, 2019). "Chewy CEO sees big job growth in Boston". Boston Globe.
  5. ^ a b Woo, Stu (March 6, 2012). "Pets.com 2.0". The Wall Street Journal. Retrieved August 2, 2016.
  6. ^ C., Piers (January 15, 2015). "Emerging startup: Chewy.com". Varyonic. Retrieved August 2, 2016.
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  13. ^ Susan Adams, "The Man Who Found Gold in Dog Food," Forbes, January 24, 2017.
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  50. ^ Brown, Brandon (August 17, 2018). "Look inside Chewy's massive distribution center in Goodyear". Phoenix Business Journal.
  51. ^ Elkins, Ken (April 17, 2019). "Chewy to build $55M, 1,200-job distribution center outside of Salisbury". Charlotte Business Journal.
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External links[]

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