Petco just bought this San Diego company you saw on ‘Shark Tank’
Petco is venturing into the subscription box business with the purchase of PupBox, a San Diego startup that delivers a curated selection of puppy-friendly products to pet parents on a monthly basis.
Terms of the deal, announced Wednesday, were not disclosed, but PupBox’s team of four will be joining Petco.
The company will continue to sell its subscription boxes, which center around providing toys, treats and training materials for puppies based on their development stage. The boxes will now also include Petco fare. And, starting today, PupBox, under the Petco umbrella, will sell its first-ever holiday box, a $29 seasonally themed version of its standard box.
Founded in 2014 by Ben and Ariel Zvaifler, PupBox achieved startup celebrity status last November when it appeared on the ABC show “Shark Tank.” At the time, the company convinced “shark” Robert Herjavec to invest $250,000 in exchange for 15 percent equity, implying a $1.7 million valuation. At the time, the Zvaiflers said they had generated $580,000 in sales from their boxes, which cost from $29 to $39 a piece.
The deal suggests that Petco will continue to look beyond its brick-and-mortar stores for growth. Earlier this year, the company purchased the pet advice website PetCoach, with its CEO Brock Weatherup now spearheading digital initiatives. It also launched a pet selfie app called Heads & Tails.
With its digital efforts, the Rancho Bernardo-based brand appears anxious to keep pace with rival PetSmart, which reportedly forked over a few billion dollars earlier this year to buy e-commerce pet food company Chewy.com. Both industry leaders, however, are under attack by an onslaught of pet tech companies that operate online and sell direct to consumers.
Valued at $4.6 billion in 2015 when it was purchased by a private equity firm, Petco earlier this year laid off 180 workers, including around 50 at its revamped San Diego headquarters. The restructuring was said to be part of a “fast-paced growth plan” for 2017.
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