Who Owns Arhaus Company?

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Who Owns Arhaus?

Understanding Arhaus's ownership is key to grasping its strategic direction and market standing. This upscale home furnishings company, founded in 1986, has a history rooted in family vision and has evolved into a publicly traded entity.

The journey from a single store to a national presence with 103 showrooms across 30 states highlights a significant growth trajectory. Arhaus reported net revenue of $1.271 billion in fiscal year 2024, demonstrating its robust market performance and the impact of its curated product offerings, such as the popular Arhaus PESTEL Analysis.

Initially founded by Jack Reed and his son John Reed, the company's ownership structure has transformed. While the Reed family held foundational stakes, Arhaus transitioned to a publicly traded company on Nasdaq. This shift means ownership is now distributed among public shareholders, institutional investors, and potentially still includes significant holdings by the founding family, influencing its corporate governance and future strategies.

Arhaus was established in 1986 by Jack Reed and his son, John Reed, in Cleveland, Ohio. The company's initial focus was on providing high-quality, distinctive home furnishings, with funding coming directly from the founders. In its first year, the Reeds expanded their operations by converting four existing franchise stores into Arhaus locations.

Founding Vision

The founders instilled a vision of craftsmanship and unique design from the company's inception. This vision emphasized sourcing directly from artisans around the globe.

Early Expansion

Within its first year, Arhaus grew by transforming four existing franchise stores. This strategic move quickly established a physical presence in the Cleveland and Akron, Ohio areas.

Private Funding

The initial capital for Arhaus was provided by the founders themselves. This private funding allowed for the early development and expansion of the business.

Sustainability Focus

A commitment to sustainability was a core tenet from the beginning. This principle guided the company's approach to sourcing and product development.

Consolidation of Ownership

In 2016, John Reed became the sole controlling owner. This occurred after he acquired his father's stake, centralizing the company's leadership and ownership structure.

Artisan Sourcing

The company's operational model was built on direct sourcing from artisans worldwide. This practice ensured the unique quality and craftsmanship of its home furnishings.

While the precise initial equity distribution among the founders is not publicly disclosed, John Reed's acquisition of his father's interest in 2016 marked a pivotal moment in the company's ownership history. This consolidation of leadership solidified his role as the primary owner, guiding the company's strategic direction. The foundational principles of craftsmanship, sustainability, and unique design, established by the founding team, continue to influence the company's operations and brand identity, as detailed in the Brief History of Arhaus.

Key Ownership Transition

A significant shift in Arhaus ownership occurred in 2016. John Reed acquired his father's interest, becoming the sole controlling owner.

• This transition consolidated leadership and ownership.
• It marked a key moment in the company's early development.
• The founders' vision remained central to the company's ethos.
• Direct sourcing from global artisans was a core strategy.

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Arhaus, Inc. transitioned from a privately held entity to a publicly traded company with its Initial Public Offering (IPO) in November 2021, listing on the Nasdaq under the ticker 'ARHS'. This move followed a minority stake acquisition by Freeman Spogli & Co. in 2014, marking significant shifts in its ownership structure.

The ownership evolution of Arhaus, Inc. showcases a strategic move towards public markets while maintaining strong founder influence. This dual-class share structure is key to understanding who owns Arhaus and how decisions are made.

Arhaus Ownership Breakdown

Arhaus operates with a dual-class share structure, granting significant voting power to its founder and family trusts. This structure ensures continued founder control even after becoming a publicly traded entity.

• Founder John Reed holds 32% of the company's stock capital.
• Family trusts own an additional 30% of the company's stock capital.
• Class B shares, held by the founder and family, have ten votes per share, while Class A shares have one vote per share.
• As of September 2022, John Reed and family trusts collectively controlled approximately 94% of the company's voting power.
• Major institutional investors as of July 2025 include Wasatch Advisors Inc., Vanguard Group Inc., BlackRock, Inc., Bank Of America Corp /de/, and Jpmorgan Chase & Co.
• The company's market capitalization was approximately $1.19 billion as of July 18, 2025, with 141 million shares outstanding.
• The IPO in November 2021 raised approximately $126 million.
• For a deeper understanding of the company's financial operations, explore the Revenue Streams & Business Model of Arhaus.

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As of July 2025, Arhaus's Board of Directors comprises eleven members. John Reed, the founder, also serves as Chairman and Chief Executive Officer, a dual role the company finds effective. The board includes directors like Albert Adams, Bill Beargie, Alexis DePree, Rick Doody, Samir Desai, Andrea Hyde, John Kyees, Gary Lewis, and John M. Roth, with Stuart B. Burgdoerfer joining as an independent director in June 2024.

Arhaus operates with a dual-class stock structure, significantly influencing its voting power and Arhaus ownership. Class A common stock, available to the public, carries one vote per share. In contrast, Class B common stock, held exclusively by John Reed and related family trusts, grants ten votes per share. This structure means that the founder and his family trusts retain substantial control, holding approximately 94.34% of the total voting power immediately after the IPO. This classification makes Arhaus a 'controlled company' under Nasdaq regulations, indicating a stable governance framework with no recent public challenges to this ownership structure.

Understanding Arhaus Voting Power

The voting power at Arhaus is concentrated due to its dual-class stock system. This structure is key to understanding Arhaus company structure ownership.

• Class A shares: 1 vote per share.
• Class B shares: 10 votes per share.
• John Reed and family trusts hold all Class B shares.
• This grants them majority control over stockholder votes.
• Arhaus is considered a 'controlled company' by Nasdaq.
• This system impacts Arhaus investors and their influence.

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In the last 3-5 years, the ownership landscape of Arhaus has transformed significantly, largely due to its Initial Public Offering in November 2021. This event broadened the investor base to include institutional and retail participants, though the founder, John Reed, and his family trusts continue to hold substantial voting power via Class B shares.

Recent institutional activity in the fourth quarter of 2024 indicated mixed movements, with entities like Bank of America Corp /de/ increasing their stake, while Capital Research Global Investors decreased theirs. This dynamic reflects the evolving Arhaus ownership structure and the influence of major shareholders.

Strategic Expansion and Financial Health

Arhaus has been actively expanding, opening 11 new showrooms and relocating 5 in 2024, reaching 103 showrooms across 30 states by year-end. The company anticipates capital expenditures between $90 million and $110 million for 2025, primarily for new showroom openings.

Capital Management and Shareholder Returns

In 2024, Arhaus distributed a special cash dividend of $0.50 per share, totaling $70.3 million. The company also engaged in share repurchases to manage equity-based compensation taxes. As of December 31, 2024, Arhaus reported no long-term debt and held $198 million in cash and cash equivalents.

Founder's Control and Public Market Influence

While the founder and family trusts maintain significant control over Arhaus, the company's status as a publicly traded entity means it is subject to broader market dynamics and the influence of its institutional investors. Understanding the Target Market of Arhaus is key to appreciating its strategic direction.

Arhaus Company Structure and Ownership Trends

The Arhaus company structure ownership reflects a blend of founder control and public market participation. The trend shows a growing influence of institutional investors, even as the founder retains substantial voting power, shaping the company's trajectory.

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