March 19 (Bloomberg) -- Darrell Cavens, the 41-year-old chief executive officer of Zulily Inc., has become a billionaire as the online retailer has rallied 58 percent this year.
Cavens, who co-founded Zulily in 2009 with the company’s billionaire chairman, Mark Vadon, has a 17 percent economic interest in the business, a stake valued at $1.4 billion, according to the Bloomberg Billionaires Index. He also owns about 4 million stock options that began vesting last May.
“The company is seeing double-digit growth in purchases from existing customers and acquiring new customers at a rapid clip,” Mark Miller, an analyst at William Blair & Co., said in a note last week. “One of Zulily’s important assets is the efficiency of its cost structure, which allows the company to profitably sell low-ticket items.”
Zulily, based in Seattle, runs a shopping website targeted at moms. It jumped 71 percent on the day of its initial public offering last November. The stock closed at $65.25 in New York yesterday, and has almost tripled since the IPO.
Laura Jones, a spokeswoman for the company, declined to comment on Cavens’s net worth.
Prior to Zulily, the billionaire spent almost a decade working at Blue Nile Inc., an online retailer of gems and fine jewelry that Vadon founded. He also worked at Microsoft Inc. and Starwave Corp., a Seattle-based software company backed by billionaire Paul Allen. A Canadian citizen, Cavens attended the University of Victoria in Canada’s British Columbia province, according to Zulily’s website.
The company operates daily flash sales with 4,500 products such as children’s and women’s apparel and kitchen accessories, according to its prospectus. Sales more than doubled to $439 million in the first nine months of last year from the same period a year earlier, the filing shows.
Zulily’s biggest investor is Maveron LLC, the venture-capital firm co-founded by Starbucks Corp. Chief Executive Officer Howard Schultz. Maveron’s 24.2 million shares are valued at almost $1.6 billion.
Of the five analysts surveyed by Bloomberg, two have buy ratings on Zulily and three have holds. The average share target price is $55.40.
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