StartupNorth

Category: Launch

  • The Rise of Fashion E-Commerce and Man’s Escape from the Mall

    [Editor’s Note: This is a guest post from Thomas Rankin. It is subset of his original post, which is a collection of thoughts and research compiled during some of the earliest exploration into the Dash Hudson business model. ]

    The Set-up

    E-commerce is on a rocketship, with clothing retailers and brands using technology to create new ways to engage with customers online. In fact, clothing and accessories is the fastest growing segment of e-commerce. A study done by Emarketer projects that online sales of clothing and accessories will continue to grow year over year at a rate faster than even the electronics and books segment, with sales reaching $73 billion by 2016.

    Don’t Forget the Dudes

    Despite the trope of women as fashion-obsessed shopaholics, men also have a desire to buy things they know they’ll look good in. However, most department stores and shopping malls are designed with the female shopper in mind, leaving men to fewer clothing options, particularly for those who are sartorially-inclined. This void, combined with growing presence of internet and mobile technology in fashion e-commerce, creates a perfect storm of opportunity for online brands and retailers that offer affordable, convenient, and fashionable options for men. According to research from Rakuten Linkshare, 83% of men surveyed prefer to shop online. Not only are men flocking to online retailers to get their new threads, but according to Chris Ventry, the general manager of Gilt Groupe’s GiltMan, men are out-shopping women by 20-30% in all areas of online shopping.

    Where the Boys Are: Men’s E-Commerce Companies

    A number of men’s e-commerce companies are cashing in on men’s interest in buying fashionable and trendy clothes online. Companies such as Frank & Oak, Bombfell and Trunk Club are at the forefront of offering a curated subscription service that makes shopping efficient for guys. Subscription commerce has proven popular with men who wish to avoid the complex decision making involved with shopping. Other online-exclusive fashion companies like Bonobos, Jack Threads, and Mr. Porter offer quality men’s fashion at various prices. Bonobos is for the guy who likes the crusts cut off his peanut butter sandwich, Jack Threads for the guy who likes crusty dive bars and Mr. Porter for the socialite upper crust. J.Crew is a well-known traditional unisex offline retailer that offers an expansive online selection for men. H&M, Uniqlo and Zara compete for the disposable fashion market at a lower pricepoint. Streetwear companies like Superdry, Saturdays Surf NYC, Need Supply Co., Union Made Goods, and Stussy offer casual and weekend wear for dudes that take their looks seriously. For the slightly avant garde, it’s all about the Nordic brands: Matinique, Norse Projects and Selected Homme are doing some of the best work in men’s fashion today.

    Beautiful Matinique people from Mantinique 2010 catalog.
    Beautiful people  from Mantinique 2010 catalog.

    Just Show me the Good Stuff

    Clearly the world has changed, as there are a growing number of fashion options for men. So many that it is easy for guys to get overwhelmed, like a child lost at Nordstrom. According to research from Rakuten LinkShare, 48% of young male shoppers between the ages of 18-25 are overwhelmed by the plethora of choices with online shopping. Refinement of those options is a serious challenge. A survey conducted by Dash Hudson indicated that more than 60% of guys aged 18-24 want social validation and recommendations before buying. This contrasts with women, where over 75% want to discover content on their own. Guys readily admit that they need help looking good, and want guidance on what to buy. For the sartorially interested male, the growth in popularity of social commerce sites has been a mixed blessing. Pinterest launched in 2010, giving consumers the ability to take part in a taste-based community that curates photos of fashion, food, architecture, hairstyles and many other things. Now social shopping companies like Wanelo, Fancy, Svpply, and Fab are making it easier for fashion-conscious shoppers to curate their style, draw inspiration from other users, and connect to their favourite stores and brands. A review of Alexa data shows that each of these shopping sites is much more likely to be frequented by female shoppers, something that is evidenced in their communities and user experiences.

    Mind the Gaps in the Market

    Despite the growth of men’s fashion e-commerce, there remains a great deal of room for innovation. Although social shopping companies like Wanelo and Pinterest allow users to curate their style, the plethora of available products can be overwhelming for the male shopper. Our research at Dash Hudson indicates that over 80% of men come to a shopping platform with the intent to buy as opposed to create content. The prevalence of dead and broken links in social shopping sites often interrupts the demonstrated intent. I am Jack’s complete frustration.

    Oops

     

    So close.

    New social marketplaces must solve the problem of enabling the customer to search great content and then convert intent into purchase. This is especially important in the case of the need and immediacy-driven male shopper.

    The Future of E-Commerce Is In Your Hands – Literally

    The trend of men shopping online will continue to grow with mobile shopping becoming the newest way to efficiently discover and purchase clothing. Mobile technology can capitalize on men’s desire to shop on the go, making the fashion e-commerce experience more efficient than ever. According to Forrester, mobile currently accounts for 5 percent to 10 percent of all retail transactions. Yet for most online retailers, the big story is that mobile commerce is increasing at a rate of up to 185 percent. For men’s retailers who have caught the mobile wave (ahem, Jack Threads) this is great news. The DDB Lifestyle Survey in 2013 indicated, of men aged 18-34, 30% use shopping apps on their phone and 24% typically shop for and buy items on their smartphones. In the age of the digital urban lifestyle, convenience wins.

    Final Thoughts

    Experiences need to become tailored to how men shop by getting the best, most validated clothing in front of the shopper for their final purchasing decision. As more social shopping experiences become tailored for men, and as better retail products are built for mobile devices, male shoppers will start to feel the warmth of a market that finally understands them. At the end of the day, it’s all about being the coolest version of yourself. Finally, guys are being given the tools that make it fun and easy for this to happen.

  • The Odds are You’re Going to Fail

    Now now chief, I'm in the zone
    Stay focused! We have this on the wall at GoInstant. Source Mike Mitchell

    I mean that in the most constructive way possible!

    You’re unlikely to recruit founders, raise money, gain traction, earn revenue, get acquired or go public. You’re very likely to fail.

    Here’s How Bad Your Odds Of Success Are

    To beat these odds, you need to be doing everything you can to find an edge, especially pre-funding or pre-revenue.

    Here are 3 of the most common questions I disappointingly ask early stage startups:

    1. You’re not full-time?

    It’s insulting to ask an investor for money if you’re not full-time on your startup.

    You need to be way beyond the one-foot-in stage before raising a round. If you don’t believe in the idea enough to go all-in, why should investors, customers or your team believe it?

    Full-time is the bare minimum. Large companies are working 40 hours a week, with way more resources. How can you accomplish more each day than them? You need to work longer. You can’t expect balance in your life, especially when the team is small. You need complete obsession over work.

    Assume there is competition working on the exact same idea. Even if you don’t know about them, imagine them. They are small startups, medium sized companies, and large enterprises. They are working relentlessly. They could launch faster. They could launch bigger. Let the threat drive you forward.

    Work weekends, work evenings, pull all nighters. Obsess over it.

    2. Where’s your demo?

    You need a demo, and it needs to be amazing.

    If you get feedback on that demo, consider it then implement it right away. Stay up all night and work on it. There should be at least two of you; the CEO demoing during the day and the CTO working all night to implement. Iterate, iterate, iterate, as fast as possible.

    The important thing here is momentum. You need serious momentum. You need an unstoppable train. Your momentum will attract your team, investors, and customers.

    3. You have side projects?

    Side projects will distract and kill your startup.

    You should be working with obsessive focus on one idea and one idea only. Facebook was almost killed by Zuckerberg’s side project.

    Side-projects are great for creativity. Many developers have side projects that they use to keep their skills sharp. Many companies have R&D labs or a percentage of hack time. Early stage startups are not the place for side projects.

    Write all your ideas down, then get back to focus. Constantly consider priority. What is the most important thing you could be doing right now to move customer or investor relationships forward? Your entire company should be thinking this way.

    You need every edge you can get

    Your only edge is to find an edge everywhere. Long hours, momentum, focus.

    It’s not sustainable, and that’s a good thing. If you can’t make it work then you fail fast. Pivot or fold and try again! If you CAN make it work you can hire enough people to bring back a healthy work-life balance.

    Set goals for your team in short intervals. We will achieve X by Y date or we will [pivot, fold, etc].

    Remember, beating the odds isn’t easy, but there are many ways to find an edge.

  • Round13 Capital puts founders first

    Scott Pelton, Bruce Croxon and John Eckert - Round13 Capital

    Round 13 CapitalWhat’s interesting about the Round13 Capital announcement today isn’t the size of the fund – they are targeting $100MM. It isn’t the people who are involved – they are amazing. It isn’t the LPs – they are different. The team, Bruce Croxon, John Eckert and Scott Pelton, are bringing together a group of entrepreneurs to serve as mentors. This is not uncommon in the US with a number of funds like SoftTech VC, Felicis Ventures, Founders Fund and similar to Founder Collective (if you are interested read the Kauffman Foundation’s Do Entrepreneurs Make Good VCs? [PDF]).

    “Venture capital firms with a greater fraction of entrepreneur VCs have better firm performance. The positive relation between entrepreneur VCs and performance is stronger for venture capital firms specializing in high-tech industries and in early-stage investment.”
    — Do Entrepreneurs Make Good VCs – Entrepreneurial Finance and Innovation Conference – The Kauffman Foundation

    The Round13 Capital team has done an amazing job of bring together founders with exits as both LPs in the fund, and more importantly as mentors for their portfolio companies. This is a critical differentiator for Canadian entrepreneurs. Hopefully the Round13 fund will close and they can start funding Canadian entrepreneurs soon.

    Round13 Investors/Founders

    This is great new for Canadian entrepreneurs!

  • Extreme Demo Day

    CC-BY-20 Some rights reserved by szeke
    Attribution Some rights reserved by szeke

    Extreme Startups has announced the Demo Day for the first cohort of companies. We’ve written about Extreme Startups in the past, we’ve covered some of the cohort including Shoplocket, and we think a number of cohort qualifies as Hot Sh!t (Jeff Lawrence (LinkedIn, @datajeff) of Granify; Michael Curry (LinkedIn, @mikecurry) of Verelo and Andrew Louis (LinkedIn, @hyfen) of ShopLocket).

    Extreme Startups

    Companies presenting at Demo Day are:

    Get a ticket or an invite

    There are no shortage of events for startups in Toronto, ranging from the originator but currently offline DemoCamp to the reinvigorated SproutUpTO. But DemoDay is shaping up to be an exciting event, with a full house, I heard that there were over 400 confirmed attendees with a large number coming in from Montreal, New York, Boston and the Bay area.

    The demos are happening on June 19, 2012 from 1-4pm. There is a post demo social happening starting at 8pm. StartupNorth is proud to be supporting both the demo event and the evening social.

    [gravityform id=”8″ name=”Extreme Startups Demo Day” title=”false”]

  • CVCA, #FFdemoday and AccelerateMTL

    Chris Arsenault (LinkedIn, AngelList, @chrisarsenault) sent me a message yesterday about writing about the CVCA conference. And I was looking at the conference trying to figure out why as an entrepreneur that I might want to attend this event. It is “the premiere networking and professional development event for Canada’s venture capital and private equity industry”. Well I don’t work in venture capital or the private equity industry, and the professional development I can get that at Ladies Learning Code or Udemy or O’Reilly. So why should I care? Maybe a “free Blackberry Playbook” would get me to pay for the registration. Disclosure: RIM is a sponsor of StartupNorth, though we don’t have any free Playbooks. 

    Then it struck me.

    1. FounderFuel DemoDay
    2. AccelerateMTL
    3. CVCA

    My goodness, this is an incredible opportunity for Canadian entrepreneurs. If you plan this correctly, you can connect with investors, other founders, folks form NYC, Boston, the Bay area. While the specific sessions at CVCA aren’t necessarily my cup of tea, you could sit in the lobby at the Fairmont Queen Elizabeth and meet every investor in one shot.

    CVCA attendees will have a “free Blackberry Playbook” . Just like LinkedIn, I’d be building an HTML5 optimized version of my application and making sure as hell it works like gold on a Playbook (which has a great implementation of WebKit browser). You could call the Fairmont and set up an espresso stand and give away coffee to everyone that demos your application. Hell if nothing else a big sign with “Free Latte” for all of the hung over CVCA attendees and have a student running to a local coffee shop for fulfillment. Great opportunity to get out and hustle.

    On top of all of this you get to see some brilliant demos at Founder Fuel. This is going to be a killer event, and you could make it a very interesting opportunity to get in front of potential investors, partners and folks from outside Canada for relatively little cost.

  • Nail it before you scale it

    Editor’s note: This is a cross post from The Meaford Group written by Peter Smith (LinkedIn). This post was originally published in January 28, 2012 on The Meaford Group.

    The Homer by Carlos Bisquertt © 2007

    I love working with Robin Hopper, my co-EIR at the Innovation Factory, for the simple fact that the guy has more catchy cool acronyms and phrases that make me sound so smart when I repeat them. “Nail it before you Scale it” is one of his latest.

    Put simply, too many start-ups try to scale their marketing and sales organization before they have nailed their value proposition and the sales story that goes along with it. The consequences can be disastrous.  Over a beer, ask Robin about the story of how he blew through $3,000,000 in investment capital on one of his early start-ups because he expanded too early without really having the customer-compelling value proposition figured out.

    Howard Gwin talks about the need for first time founders to create momentum and velocity in order to overcome the investor bias against funding first-time teams. (The Three P’s of a Technology Company). If you haven’t read his blog, do so now. He offers sage advice to wait before seeking VC funding until you have “proof points and a traction story that is damn near breathtaking”. Beyond that, don’t fall into the trap of trying to create that momentum before you fully understand why the market wants your technology and how you package it for consistent, reliable and predictable sales.

    At the Innovation Factory, we work with many start-ups. Most go through one or more “Pivots” before they find the kernel at the core of their product or idea that will really sell.  Unfortunately, some will never find it because even though the idea or technology was interesting or cool, the product will never be compelling to an intensely competitive marketplace. Good entrepreneurs figure this out fast and kill the idea but then move on to another.

    I recently met one of these entrepreneurs. He built and sold his first company when he was 19 for $100,000. (It may not sound like much but I wish I had a hundred grand when I was 19). His second company was a professional services company. He built it, had success and then killed it because he realized he could never scale it fast enough to fulfill his dream. His third company was a software company and dealt with project management infrastructure. The idea and technology were good but the market was crowded and more importantly, the sales process would be long. There also were too many factors out of his company’s control in the value chain of customers getting value from his product. He had arranged Angel funding and was ready to launch but instead he listened to advice and killed the company before taking the investment. His fourth company looks like a winner. It is in a hot space, has uniqueness, has the ability to scale quickly around a solid value proposition and he has surrounded himself with a good team. He has also already pivoted at least once on his value prop in order to get ready for traction.

    So, if you are early in your game, my advice to you is simple:
    1. Figure out your value prop
    2. Keep pivoting it and your company until you have proof points that you can create massive momentum and traction quickly
    3. Use Friends & Family and Angel funding to keep you going through these phases
    4. Then go talk to VC’s.

    In other words, “Nail it before you Scale it.”

    Editor’s note: This is a cross post from The Meaford Group written by Peter Smith (LinkedIn). This post was originally published in January 28, 2012 on The Meaford Group.

  • EmmaActive launches at DEMO

    EmmaActive, based in Abbotsford BC, is bringing to market an in-image ad unit that consumers will love. The platform turns images across the web into interactive units and enables crowd sourced tagging of photos. Publishers just have to drop a couple lines of javascript on their site to activate the untapped inventory.

    In image advertising is heating up with GumGum, Stipple, Luminate, and a few others vying for pole position and racing to deploy with publishers. The other dark horse is Facebook who might syndicate image tagging along with Facebook Connect. Of course, we’re rooting for the home team. Congrats to Nathan Leggatt and the EmmaActive team on the launch.

  • GoInstant launching tonight at TechCrunch Disrupt

    You haven’t seen many posts recently from my StartupNorth Cofounder Jevon MacDonald for a very good reason… he has been working on a startup.

    Customers can’t wait to get their hands on it. Robert Scoble had this to say: “It is one of those companies, when you see it, you say wow that is so cool. It should be bought by Facebook or Salesforce.”

    GoInstant has raised seed funding from an impressive syndicate including: Josh Felser (Freestyle Capital), Reid Hoffman (Greylock Partners), Howard Lindzon (Social Leverage), Steve Anderson (Baseline Ventures), Chamath Palihapitiya (Embarcadero Ventures), Patrick Keefe (Innovacorp), Boris Wertz (W Media Ventures), Ed Sim (BOLDstart Ventures), Yuri Milner, Matt Wyndowe, Daniel Debow, and myself.

    The Halifax based company has been in stealth mode for 9 months. By now you are probably wondering… what is GoInstant?