When I had the chance to interview Beth Gerstein, co-founder of Brilliant Earth, I first wanted to ask her how they raised the money to start the company. I figured that retailing gold, platinum and diamond jewelry had to be a capital-intensive business and thought Beth could shed light on how a green entrepreneur can convince investors that there is a large market for products that are sustainably produced.
However, I got a very different story. Brilliant Earth has been entirely boot-strapped, although that adjective doesn’t seem apt for a company that sells beautiful products, has an elegant identity system, and does business via a beautiful website.
Brilliant Earth sells conflict-free diamonds, which are mined in Canada in accordance with environmental laws as well as jewelry made of “renewed” gold and platinum, i.e., recycled metals.
Instead of investing in a large inventory up front, Gerstein and Eric Grossberg started Brilliant Earth by serving as a match-maker so to speak for people looking for conflict-free diamonds for engagement rings, as well as other jewelry pieces of ethical origins. Gerstein says, “Our philosophy was to start to build supplier relationships and then to get customers, growing organically.”
Given that the products are photographed beautifully and are shipped free with a 30-day return policy, it is not so surprising that consumers were willing to buy from BrilliantEarth.com, although I am sure no entrepreneur would want to hear me discount how much work it is to make the first first few sales.
What is surprising is that Gerstein and Grossberg had trouble finding suppliers willing to let Brilliant Earth sell their products. Gerstein explained, “[Fine jewelry] is a trust-driven business. There are lots of family businesses with relationships going back a very long time. You would think that if you want to retail their products companies would be happy to work with you.” However, Brilliant Earth wasn’t just a new company trying to break into an established industry, but, as Gerstein says, “We were asking questions that they weren’t used to. We have certain specs and parameters we want our suppliers to meet. We only want manufacturers that use recycled platinum and gold.” Plus Brilliant Earth wanted to change the business model. Instead of purchasing inventory, they wanted to take possession of the product when they had found customers.
Brilliant Earth’s story should be encouraging to entrepreneurs, since they are making it. Gerstein and Grossberg started the company in April of 2005 and made their first customer match within a few months. As you can see from this photo of Gerstein (left) at the Green Festival in San Francisco in November, the Company has working capital to invest in marketing, including sample inventory and booth space at shows, which can cost thousands of dollars per event.