News – Renamed Gem Site Shines $36M Deal

Online jewelry retailing has become an increasingly competitive sector, and in the latest effort to compete, Odimo.com – formerly known as DiamondDepot.com – has changed its name and raised $36 million to rapidly launch an international effort. The company is also evaluating public market opportunities.

Softbank Capital Partners invested $31 million in the transaction, which saw Steinmetz Diamond Group, the company’s majority shareholder, commit the balance, said Alan Lipton, president and chief executive of Odimo.com.

The immediate use of proceeds will be to launch operation of Odimo Europe and Odimo Japan. In fact, these international aspirations led to the company’s decision to change its name.

“Depot doesn’t have a positive connotation in other countries, and we can’t brand two names, so we opted for Odimo,” Lipton said.

Following the transaction, the company will cede one seat on its board of directors to Softbank.

In addition to the relationship with the Steinmetz Group, which Lipton said does more than $1 billion a year in diamond business, Odimo has strategic partnerships with site holders and diamond dealers. Site holders are companies that buy rough diamonds directly from DeBeers.

Lipton said that in separate studies by Goldman, Sachs & Co. and Forrester Research, more than 50% of the $100 billion global jewelry market will begin to occur online. As a direct seller of diamonds, brand-name watches and fine jewelry, Odimo expects to not only sell to consumers, but Lipton said retailers will likely see the savings available online as well.

Lipton said the company is currently looking at an initial public offering as its next financing event, and he added that the goal is to do it rather quickly.