Global Vision Care Industry Investment and M&A Review 2017: Covering Seven Key Segments

VBInsight International Vision Fund is dedicated to identifying innovative technology companies in the field of vision science on a global scale and connecting them with China’s rising industrial forces, to create better vision and insight. Below, it reviews global investment and M&A cases in the optometry industry in 2017 and provides an outlook on future trends.

In the past few years, the global eyewear market has achieved steady growth. According to statistics from market research firm Euromonitor, the total size of the global eyewear market reached $127 billion in 2016, with a compound annual growth rate (CAGR) of 2.5% from 2011 to 2016.

This steady growth stems from a series of structural social changes, including:

1. Population aging has triggered a widespread surge in vision problems;

2. The widespread adoption of mobile devices, such as smartphones, has led to a rapid increase in the incidence of myopia;

3. Rising incomes and improved living standards have led to increased attention to vision protection;

4. Eyeglasses, as fashion items, have become essential accessories for young and fashionable individuals.

Therefore, over the next three years, the global eyewear market will continue to maintain a compound annual growth rate (CAGR) of 2.5%.

On the other hand, with the development of the entire optometry industry, there have been more and more investment and merger cases in the industry. In addition to the well-known merger between Essilor and Luxottica, according to statistics from Ruimengxi Capital, a total of 15 investment and merger cases occurred in the global optometry field in 2017, as follows:

1. Luxexcel Secures $10 Million in Series B Funding from Multiple Investors

Luxexcel, a Dutch 3D-printed optical products company, completed a $10 million Series B financing round in May last year, with investment from multiple institutional investors across countries including the Netherlands and Germany.

Through this round of financing, Luxexcel successfully launched its optical 3D printing equipment in the second half of 2017 and established collaborations with multiple ophthalmic and optometric research institutions in the United States. According to the company, its 3D printing platform enables the manufacturing of a range of eyeglass lenses, including single-vision, bifocal, and trifocal lenses. All lenses produced using the company’s process are compatible with industrial coatings and other processes, such as edging and framing.

2. AddonOptics Secures Investment from Alliance Capital, Former Bausch + Lomb CEO, and Others

Addon Optics, an optical lens startup from Israel, has developed innovative, low-cost, flexible progressive addition lenses for presbyopia. This technology is poised to transform the production and sales model of progressive presbyopic lenses, enabling eyewear retail chains and online optical retailers to achieve timely delivery while significantly reducing lens manufacturing costs. Leveraging the strong scalability of its technology, the company’s products can also be applied to other specialized eyewear, such as sports glasses, protective eyewear, and AR/VR headsets.

In 2017, Addon secured investment from the Ruimengxi International Vision Fund, with its investor roster also including former Bausch & Lomb CEOs.

1. Optometry Innovator Aston Eye Tech Secures £5 Million in Funding

Aston Eye Tech is a UK-based vision technology innovation company founded by the Optometry Department of Aston University in the United Kingdom. In 2017, the company completed a £5 million financing round, with the funds primarily designated for the development of novel lensmeters, optometers, and artificial intelligence-powered ocular disease detection devices.

2. Remax Capital, Doctor Glasses, and Lenskart Invest in Israeli Online Innovative Optometry Technology Company 6over6

In November 2017, 6over6 Vision, an Israeli innovator in online optometry technology, completed a $11 million Series B financing round. The round was led by IMC International Vision Fund, with participation from Doctor Glasses, a well-known Chinese eyewear retailer, and Lenskart, India’s largest online eyewear platform. 6over6 has developed a comprehensive smartphone-based optometry and eyeglass-fitting app suite, featuring unaided vision testing, a lensometer, a pupillometer, and multifocal lens fitting capabilities.

Consumers do not need to purchase any additional hardware devices. By using a smartphone and computer at home for just a few minutes of simple operation, they can quickly obtain all the necessary parameters for eyeglass prescription, thereby completing the entire purchasing process. This solution is applicable for both online and offline use. The company’s newly developed multifocal lens fitting system has already been deployed in the Indian market, and the company is currently developing related solutions for progressive presbyopic lens fitting and vision screening.

It is worth noting that in the field of remote optometry, several companies have secured financing since 2014, including Eye Netra, which raised $7 million in 2014; Smart Vision Lab, which raised $6.1 million in 2015; Eye Que, which raised $6 million in 2015; and Opternative, which raised $9.5 million in 2016.

1. Firstmark and others invest in Series A round of U.S. online contact lens retailer Hubble Contacts

Hubble Contacts is a U.S.-based e-commerce platform for contact lenses, selling directly to consumers through online orders. The company completed a $7.2 million seed funding round in November 2016, followed by a $16.5 million Series A financing in March 2017, with investors including U.S. firms such as Firstmark Capital. Following this latest funding, the company plans to launch specialized lenses for customers with astigmatism and will continue to expand its marketing efforts and recruitment.

2. SimpleContacts Secures Series B Funding from Goodwater Capital and Others

In April last year, Simple Contacts, a U.S.-based e-commerce platform for contact lenses, secured $8 million in Series B funding led by Good Water Capital. Through its mobile app, the company provides users with online contact lens ordering and delivery services. The company plans to allocate the funds toward product development and team expansion to further refine its offerings and broaden its market reach. Currently, its product is available only on iOS; the company intends to develop a telemedicine application for Android as well as an online web platform.

3. Yishike Glasses Secures RMB 10 Million in Series B Funding from Shenzhen United Venture Capital

In July 2017, Yishike, a domestic online-to-offline (O2O) eyewear retailer, announced that it had secured tens of millions of RMB in investment from Shenzhen United Venture Capital. The funds from this financing round will be primarily used to develop contact lens products, with the possibility of acquiring existing contact lens brands on the market. By building its own products and brands, Yishike has reduced eyewear sales costs, while also deploying optometry vehicles to provide users with at-home optometry services booked online.

4. Mafu Glasses Secures RMB 120 Million in Financing, with Investors Including Qifu Capital and Others

Ma Fu Glasses is a butler-style eyewear fitting service platform that provides in-home eyewear fitting services. Through its online eyewear solutions, it offers professional and comfortable customized fitting plans for users. In September 2017, the company announced that it had secured RMB 120 million in Series B+ financing, with investors including Huaqiang Asset Management, Qifu Capital, and Shilan Asset Management. Following this round of financing, Ma Fu’s butler services will expand to cover 30 major and medium-sized cities across China.

5. Johnson & Johnson Acquires U.S.-Based Online Contact Lens E-Commerce Platform Sightbox

Sightbox is a U.S. vision care startup dedicated to integrating vision insurance with online retail and customer service through digital platforms. It offers new services to contact lens wearers while driving new business to more than 50,000 local optometry practices across the United States. In December 2016, the company completed a $1.8 million seed funding round, followed by a $2.4 million financing round in July 2017. Subsequently, in September 2017, Johnson & Johnson acquired Sightbox for an undisclosed amount.

Lenskart Invests in Ditto, a U.S. Online Eyewear Virtual Try-On Solutions Company

Lenskart is India’s largest domestic online eyewear retailer. To further enhance user experience on its website, Lenskart invested in Ditto, a U.S.-based provider of virtual eyewear try-on solutions, last September. Ditto uses computer or smartphone cameras to create facial models for users, enabling online virtual eyewear try-ons. Following the investment, Lenskart has integrated Ditto’s 3D eyewear try-on technology into its website and mobile app, boosting online consumer engagement.

1. LVMH, IDG, and Others Invest in South Korean Innovative Eyewear Design Brand Gentle Monster

L Catterton Asia, the Asian private equity fund launched by French luxury giant LVMH, announced its investment in Gentle Monster last September. Not long ago, Gentle Monster also secured equity investment from IDG Capital of China. This South Korean eyewear company rose to prominence with its “quirky aesthetics” and distinctive store concepts. Each of the brand’s stores features a unique style, with designs conceived by integrating the architecture itself and local culture, thereby showcasing diverse creativity and styles.

2. Pioneer Eyewear Group’s Coterie Secures Tens of Millions of RMB in Series A Funding, Led by Panda Capital

In September 2017, Coterie, a fashion group aggregating global trendy eyewear brands, announced the completion of its Series A financing round, raising tens of millions of RMB. The round was led by Panda Capital, with Hemei Group participating as a co-investor. As a fashion group dedicated to global trendy eyewear brands, Coterie operates on the philosophy of trend, lifestyle, art, and vision, and has introduced more than 100 premier designer eyewear brands from around the world into the Chinese market.

National Vision Lists on NASDAQ for IPO

National Vision is one of the largest and fastest-growing eyewear retailers in the United States. It was acquired by KKR in 2014. As of July 1, 2017, National Vision Holdings, Inc. operated 980 retail stores and multiple sub-brand e-commerce platforms, including America's Best, Eyeglass World, Walmart Vision Center, Vista Optical at Fred Meyer, and Vista Optical Military. In September 2017, the company went public on the NASDAQ stock exchange under the ticker symbol: EYE.

1. Vivid Vision, a VR therapy device company for strabismus and amblyopia, completes $2.2 million seed funding round

Vivid Vision is a company that leverages virtual reality technology to assist individuals with visual impairments such as amblyopia or strabismus. Its products integrate VR games to deliver customized treatment regimens for each patient, aiming to address the limitations of traditional therapies for strabismus and amblyopia. Last May, the company announced the completion of a $2.2 million seed funding round, with investors including Unlock Capital.

2. Low-Vision Assistive Device Company Aira Announces Completion of $12 Million Series B Funding Round

Aira is a startup that provides smart glasses for the blind and visually impaired, and it announced in May 2017 that it had completed a $12 million Series B financing round. The round was led by JAZZ Venture Partners and Arboretum Ventures, with the National Federation of the Blind participating as a strategic investor. The company’s product, developed based on Google Glass, enables family members or friends of blind individuals to observe the wearer’s perspective and surroundings via video, while also providing voice assistant services to the user.

Note: Original content by Ruimengxi Capital; republished with authorization from VCBeat.