Pet Smarter

Four years ago Chewy’s college-dropout founders couldn’t get a meeting in Silicon Valley. Now they’re running one of America’s biggest privately owned e-commerce sites.

- Susan Adams

In December 2012, desperately needing money to expand Chewy, his year-old pet supply startup, Ryan Cohen traveled from Fort Lauderdale to Palo Alto and walked into a half-dozen venture capital firms on Sand Hill Road unannounced. He didn’t get past the receptionists. Three months later he tried the same tactic again. “I’m relentless,” says Cohen, a college dropout from Montreal. “It felt like it should work.” It did not.

Yet four years later Chewy is one of the nation’s largest and fastest-growing privately owned e-commerce companies, on track to book revenue of $900 million in 2016 and more than $1.5 billion in 2017. Relying on a customer service strategy Cohen calls “Zappos on steroids,” Chewy deploys 416 of its 3,400 staffers to answer phones and texts in round-the-clock shifts at the company’s 70,000-square-foot headquarters in Dania, Florida. To ensure speedy delivery to his 3 million patrons, he has built three fulfillment centers, each the size of ten football fields, and has plans to open three more by early 2018.

Chewy has already grabbed 43% of the online sales of pet food and litter in the U.S., just behind Amazon’s 48%, according to market research firm 1010 data. (Big-box retailers Petco and PetSmart are both in the single digits.) “We want to be the No. 1 pet retailer in the world,” Cohen says. He has a long way to go. Chewy has yet to turn a profit, and the way it’s spending money to acquire customers, it’s not clear it ever will.