From the beginning, Jet CEO Marc Lore has preached a gospel of transparency.
His startup promises to sell everyday products for prices that are 10-to-15% lower than competitors offer. It will accomplish this by forgoing all profits on the goods it sells — instead, it pledges to only make money from a $US50 annual membership fee shoppers must pay in order to participate.
Internally, Lore posts every board meeting presentation online for his employees to view. He also talks openly about employee stock options and has a public pay-scale system; employees aren’t able to negotiate salaries.
Lore’s transparency extends to Jet’s investors, too.
The site, which launched Tuesday, has raised $US225 million from investors at a $US600 million valuation. Next week, the company plans to launch an app called JetStream that will give investors real-time, detailed access to all of its financial information.
For the rest of us, Lore’s already laid out the road map pretty concretely:
He says Jet’s model will lose money until it sells $US20 billion in products per year. Lore says the site should hit that landmark in 2020.
In the meantime, Lore plans to spend $US100 million on marketing in the next year, and The Wall Street Journal reported that he’s planning to raise even more funding, at a $US3 billion valuation.
“The pressure’s on top-line,” Lore told Business Insider during a phone call Tuesday morning. “We know that in order to get break even, we need to get to $US20 billion, so the pressure’s on there. And the pressure’s on every month to reduce the percentage of operating loss. We have this big negative right now and we need to get it down to zero in five years.”
He laughs. “There’s plenty of pressure.”