18th Mar 2011
1. Describe your business in one sentence
Made.com is about selling top quality furniture online at affordable prices by cutting out the middlemen and putting the customer directly in contact with the factories.
2. How did you come up with the idea for your business?
When the three of us (my business partners Ning and Julien) met in London 2009 we all felt that there was an opportunity to offer something new to the UK furniture market. It is common for high-end, designer furniture to typically pass through five middle men resulting in high marks ups and high prices for the consumer. Also, the customer has little do with this process. We saw an opportunity to connect the buyer directly with the supplier, cutting out the middle men and keeping the price down.
We also include an element of crowd-sourcing to our website. This helps us to find out what people want by letting them vote on products they like we then collect orders and only make what is already allocated to a particular customer.
Ning had been looking into this business plan for a while and so we started a conversation with Brent Hoberman who I had worked with for three years at MyDeco. He chose to invest and is now our chair. He brought great knowledge and valuable network links to the business.
3. What have been your key challenges and how have you overcome them?
For the three of us, who were all born and raised in France, we had to take time to understand the British market.
Other challenges associated to our business model include looking for products which we feel will sell at a large scale, but are still interesting or unusual and will get some attention and make us visible in the market place. Our Stroller Desk, designed by Steuart Padwick, was a tricky product to develop but it was a great surprise when it became one of our most successful both from a revenue and PR point of view. This demonstrates that it is worth making unique, qualitative designs accessible to all.
We were concerned at first about the competition as the furniture market is crowded in the UK. But, because our business model is so different, the competition has actually been a very good thing. We could show how we could compete with the most competitive players in the current market.
Of course the state of the economy was a worry for us but we have found that people are looking for a bargain but are also expecting more for their money.
4. How have you funded your start-up?
We were lucky to have Lastminute.com co-founder Brent Hoberman onboard from an early stage, who opened up his networks to us and networking has been key.
We pitched our ideas to other high profile internet players (including Marc Simoncini, Meetic, iFrance; John Hunt, Syzygy's, Obongo, Seattle Coffee shop and Michael Birch, Bebo and Profounder Capital) who fortunately liked the ideas and were impressed with the team in place. It is definitely worth noting that potential investors will want to know who is in charge and who will be doing the work.
Our business model was also impressive from an investor's perspective as it is cash flow positive; we collect all the orders and get 100% of the product payment before we start production. Also, being online, we have very few of the traditional retail costs like a shop and storage.
5. How do you market your business?
We still get the majority of our business through PR and word of mouth. We also have an incentive cashback programme in place to encourage customers to tell their friends about us which has been really successful.
6. What are your plans for the future?
We plan to expand the product range and investigate other lifestyle categories that fit with our values. We have recently started to sell bicycles so our future won't just involve furniture.
7. If you started again, is there anything you'd do differently?
Logistics and product development and the two areas which, on reflection, needed some more support. Logistics is a crucial element of what we do and the area where we mainly rely on a third party, but we still need to treat it like it is 100% our responsibility to make the customer happy by managing the pre and post delivery process.
We started with a very small team and wanted to set the basis of the foundations of the business before expanding. But, after recruiting a couple of new members this month to support the logistics and product development teams in both London and Shanghai we can see how much smoother things operate with them in place.
8. What advice would you give to other entrepreneurs based on your business experience so far?
- Stay passionate: Be true to your idea but seek the input of people in the know.
- Network: Use and grow your network by working collaboratively.
- Involve the customer: Increasingly we find that costumers look for a more personal connection with the products they buy. Their feedback is invaluable.
- When pitching to investors: demonstrate opportunity for growth; is the idea convincing? Is the team strong? Does it have potential to grow globally? These are all questions they will want answering.