All through hip-hop’s lengthy historical past, jewellery has served as an necessary car for artists to convey their concepts and affluence, or just to dazzle onlookers. Diamonds, specifically, function an necessary motif, famously exemplified by Drake’s $400,000 diamond-encrusted iPhone case.
However not everyone seems to be a millionaire rapper, and most of the people can’t precisely afford to put on bust down watches flooded with ice. Nonetheless, there’s definitely a marketplace for such jewellery at a lower cost level, and enterprise capitalists seem to have observed it: A direct-to-consumer diamond jewellery startup known as Pascal has raised almost $10 million in VC funding to this point, of which $2.5 million got here from Andreessen Horowitz in early 2023, TechCrunch has realized.
What’s extra, the corporate expects to generate $20-$30 million in income this yr, and has a three-month buyer repurchase fee of roughly 20%, in response to its founder and CEO, Adam Hua.
Pascal’s pitch is that it will probably make diamond jewellery accessible by utilizing lab-grown diamonds which might be chemically and bodily akin to pure diamonds however price one-twentieth of the worth. The corporate’s gem-studded jewellery begins at as little as $70, and it’s hoping utilizing cultivated diamonds will assist it acquire a foothold within the extra inexpensive phase of the broader jewellery market.
“Diamond is unique to hip-hop; it’s a status symbol. But most people cannot afford diamonds,” Hua stated. “Cultivated diamonds fundamentally transform the supply side of the industry.”
Artificial diamonds have been round since the 1950s, and so they’ve been typically used to make high-carat jewellery. These diamonds are normally “grown” in labs, the place excessive forces and warmth are utilized to graphite, much like the method that offers rise to naturally occurring diamonds. Producers of lab-grown diamonds typically additionally wish to tout their extra environmentally pleasant course of, and a few even take their missions a step additional by making diamonds from captured carbon.
For Pascal, the main focus is “culture,” and it isn’t making an attempt to disrupt the pure diamond sector. “The demand for luxury diamonds [for jewelry like] engagement rings will remain,” Hua stated. “We are just creating a new, affordable diamond category.”
Pascal’s diamonds enhance every thing from watches to lipsticks and are available in a variety of colours, which is uncommon in pure diamonds. Lab-grown diamonds, Hua harassed, are additionally shinier, “making them good for TikTok videos.”
To seek out provide, Pascal turned to Henan, a central Chinese language province that has turn out to be a major production hub for artificial diamonds on the planet, and China’s rising manufacturing neighbors like Vietnam and Thailand.
“It’s a naturally cross-border business,” Hua stated of his firm. The U.S. is at present Pascal’s largest market, adopted by Europe, he added.
Hua seems to have a knack for working trend companies. Whereas finding out physics at UC Berkeley, he sourced sneakers from the U.S. and provided them to resellers in China, which helped him earn his first million {dollars}. He then based a peer-to-peer streetwear market in China, which raised over $10 million in fairness funding and generated $1 billion price of gross merchandise worth in its third yr of operation. His expertise working that firm ultimately impressed the concept for Pascal.
“I realized that most of my customers were Gen Z and their purchasing power was growing over time,” he informed TechCrunch. “Around 2022-2023, the average ticket size had shot up to $500, but there wasn’t a good product category for the $500+ price range.”
As he scoured the buyer panorama, Hua picked out hip-hop trend. He checked out how followers of rock bands typically buy clothes and items that may vary from $30 t-shirts and $200 sneakers to $500 leather-based jackets and $1,000 jewellery to make a press release about their cultural id.
“What if there were a $500-$1,000 category of diamond products for hip-hop fans and other diamond lovers?” he stated, talking about his thought course of. “Folks wish to get their cash’s price once they purchase one thing for high quality and cultural wants.
