On Friday Home Depot, the giant do-it-yourself home improvement chain based in Atlanta Georgia, announced that it had closed on the acquisition of Blinds.com. Based in Houston Texas, Blinds.com is the world’s largest supplier of window coverings to the consumer in the world, operating exclusively so far through its own online store.
While Home Depot is a publicly traded company, listed on the New York Stock Exchange (HD (NYSE)) , the financial and other principal terms of the deal have not been formally disclosed, presumably because it was not large enough to be material to its statements. We do take an educated guess at it below however.
Privately owned Blinds.com is led by its founder and CEO Jay Steinfeld, who said formally after closing the deal, “We’re joining forces with Home Depot because there is a huge opportunity to utilize each other’s strengths, take additional share in this category and move even faster toward our vision of making the design, purchase and installation of quality window coverings as easy and affordable as possible”
He then added, “We will continue to build the Blinds.com brand and culture in our own unique way, and we believe The Home Depot is the best partner to help us do this over the long term.”
More informally he told the Houston Business Journal he sees the deal as a way for his company to now grow exponentially.
“Merging with them gave us a leapfrog to where we could have been two years from now by ourselves, ” he told the reporter.
The Blinds.com management team and staff will remain intact at its headquarters in Houston to continue growing its successful brands, customer experience and unique culture of service.
Frank Blake, Chairman & CEO of Home Depot said of the deal, “We’re delighted to welcome the Blinds.com team into the Home Depot family, ” and added, “The acquisition of Blinds.com positions us well for expansion in the quickly growing online window coverings market. In addition, their unique sales and service model is one we hope to learn from as we continue to create even better interconnected retail experiences for our customers.”
In business since 1996, Blinds.com has developed a simple, seamless and obviously effective online and mobile experience. Its knowledgeable, well trained staff has been selling window coverings for an average of 12 years each, and they are available to service customers by phone, live chat and face2face video consultation.
Home Depot is still refining its own online retail strategy, to best combine bricks and mortar stores with online shopping. Blinds.com is therefore likely a good fit to help expand their technology into the homedepot.com online space, as well as take a presence of their own in the company’s physical stores. The goal for Blinds.com itself is simply to improve the entire end-to-end buying process for window coverings for the company’s customers and vastly broaden their reach.
About Home Depot
Home Depot is the world’s largest home improvement specialty retailer, with over 2, 000 retail stores in the United States, Canada and Mexico. In fiscal 2012, Home Depot had sales of about US$75 billion and earnings of US$4.5 billion. The Company today employs over 300, 000 people.
Blinds.com was founded by Jay Steinfeld and has been operating since 1996. Today it is the world’s largest online window covering store, providing blinds for over a million windows every year. In March, 2010 Blinds.com was awarded the American Marketing Association’s Marketer of the Year award.
About Jay Steinfeld
Jay Steinfeld earned his degree in Accounting with Honours from the University of Texas at Austin. After graduating, he worked for KPMG Peat Marwick, then entered the retail auto-trade as CFO of the national franchise, Meineke Discount Mufflers. Later he started his own small chain of retail stores to sell window coverings.
Steinfeld launched his first Web site as early as 1993, and eventually sold his own physical stores in 2001 to go exclusively online with Blinds.com which he had started in 1996. He was an Ernst and Young Entrepreneur of the Year in 2006. Steinfeld also writes a regular weekly column on leadership, called the Chief Executive Officer, for an online magazine aimed at small business, Inc.com.
Jay Steinfeld also has a sense of humour. In a radio interview a couple of years ago he was asked how he had managed to build up a business with sales at that time already pushing past US$80 million a year. Steinfeld’s deadpan reply was, “one blind at a time”…
If Blinds.com has kept growing since at that kind of rate, today the company’s annual revenues are quite possibly already close to, or over, US$100 million, certainly making him an attractive catch for Home Depot.
Even a valuation of only 1 x revenues, therefore, could imply he has just picked up at least US$100 million by selling the company. Plus, he gets to keep on running the business too!