“A kiss may be grand, but it won’t pay the rent, so diamonds are a girl’s best friend”. These words from the 1953 movie “Gentlemen Prefer Blondes”, sung by then-unknown Marilyn Monroe in her rendition of the title song, went on to become one of the most famous movie songs of all time, launching the spectacular and tragic career of one of the 20th century’s top iconic stars.
And it wasn’t only Marilyn Monroe. Another emblematic movie star of that time, Audrey Hepburn, became famous after starring in “Breakfast at Tiffany’s”, yet again a clear classic movie association with diamonds. In the golden age of Western post-war prosperity growth, the attributes of the newfound middle-class lifestyle consisted of a 9-to-5 office job, a house with a bathroom and a washing machine, a family car for work commutes and holidays, and a diamond engagement ring. As with the other elements of that lifestyle, diamond rings were something that just decades earlier was available only to a wealthy few, but thanks to the rapid industrialization and growth of the 1950s and and 1960s, became a mainstream accessible symbol of personal and societal success.
Seventy years later, in our time and age, many things are different. Thankfully, we no longer accept the sexualization of women, and we don’t see car- and house ownership and an office job as mandatory success factors. Diamonds, however, are still pretty hot. The price of diamonds has grown steadily since Marilyn and Audrey starred in their movie classics, with the most sought-after cuts costing more than 10 times the 1960s prices, a 5% annual compound growth. A big reason for that is that supply is limited, while demand remains high. And bringing innovation to better match the supply and demand is exactly what Vitosha portfolio company Taylor&Hart is all about.
As noted, supply is limited, because diamonds are only found in substantial quantities in a very few places on Earth. One of those places is South Africa, where Bulgarian-born entrepreneur Nikolay Piriankov grew up, after his parents moved there from Bulgaria following the collapse of communism. When Nikolay was in high school, his aunt helped him get an internship in a local diamond company she was working for, and it left the ambitious young man not only with a profound interest in the industry itself, but also with a strong passion for the product. When years later, having moved to the UK and built a corporate career in marketing, Nikolay decided to return to his family’s entrepreneurial roots and start his own business, he knew straight away it would be something related to his old passion for diamonds.
Combining his marketing expertise with diamond industry insights, Nikolay quickly found out a few unique aspects about diamonds. First off, diamonds are predominantly bought by men, but almost always based on the wishes and preferences of women. Secondly, most diamond customers miss the ability to customize their order, like deciding on the combination of stone and ring. While traditional vendors moved to online sales, these channels simply mirror the offline retail experience, and Nikolay immediately sensed that people of his generation and younger aren’t content with that.
In 2013, Nikolay launched the first iteration of the company with the support of family and friends; an online diamond ring retailer, with full price transparency, maximum customization, and a strong focus on customer service and satisfaction. By 2016, the company got accepted into the Techstars Boston batch, where Nikolay and the team augmented their understanding of diamonds and online retail and marketing with the startup principles of iteration, product-market fit, and scalable growth.
“My biggest takeaway from the accelerator program was that it’s not about accelerating business growth, but rather accelerating decision making”, says Nikolay today from his downtown London office. “Once we learned that, we repositioned the company, changing the founder team and rebranding it to Taylor&Hart, the company’s name today”.
As Nikolay explains, branding is incredibly powerful in premium sectors like the jewelry one. “Our average order value jumped 30% overnight”, he says. In 2019 the company raised a Series A round, and managed to weather through the challenge of the Covid years afterwards. It was a hard time, according to Nikolay: “it was primetime for e-commerce, but engagement rings are bought for weddings, which people stopped or delayed planning during the lockdowns. Nevertheless, we managed to grow sales and saw our profit margin go 36% to 48% in that period.”
Today, Taylor&Hart is an established player in diamond retail in Europe, with over 55 staff in UK Bulgaria, and our investment last year with Vitosha was strategically timed for yet another fundamental growth plan the company is preparing itself for. “Having served over 13,000 customers with diamond rings, we are now perfectly positioned to upsell non-wedding jewelry, which is something that we’ll need offline expansion for. Next to that, we are aiming to enter a number of new target markets in Europe, as well as to focus on growing our US presence, a market that’s good for close to 10% of our total sales, while we don’t spend any marketing budget there yet”, sums up Nikolay.
At Vitosha, we’re excited to be part of the growth and development at Taylor&Hart. To paraphrase one more movie title: diamonds may be forever, but building a modern, digital, and scalable business out of this iconic product is no easy feat. And that’s something that Nikolay and his team at Taylor&Hart are successfully accomplishing.