Female Founder Interview: Silvia Cody of SecretSales.com
Silvia Cody, Founder and Director of Secretsales.com, the exclusive and private sales website is building a huge presence in the UK. The NextWomen had the opportunity to interview Silvia after the BIG Kitchen dinner about her business and its strategic partnership with Brands for Friends.
"You need one person who is going to open the doors for you, you need someone to hold your hand."
THE START OF SECRETSALES
The start of Secret Sales followed Silvia's twenty year career in fashion manufacturing -together with her husband-, most of the times for buyers of high street fashion chains. The manufacturing was done in the Far-East which required a lot of traveling, "practically all the time, because we needed to be on the ground a lot to check that everything was well-done, according to the specifications", according to Silvia.
It meant a pretty bad work/life balance, and for Silvia and her husband it meant that they were always away from each other. Also, it was very demanding: "High street people are not always as loyal as you want them to be; the main people you deal with are buyers and they change all the time from position, while at the same time they throw a lot of the problems at you, as manufacturer." After twenty years, the couple decided that it had been great, but enough.
Moreover, as Silvia says:
"Apart from work/life balance, I really wanted to build a 'real' business, a huge company which would turn around millions, it was a dream I always had."
Basically, there were mainly private reasons that led them to change and start a new business.
First, they looked whether they could sell their manufacturing business, however, as there was a lot of personal goodwill involved and many of the staff was on part-time basis abroad, the business was not 'sellable'.
So they set out to come-up with a new business, where the basis would be London. Silvia being French, had seen the enormous success of vente-privee in France, so setting up the « vente-privee » of the UK, was their initial idea, and so their version of it, SecretSales came about.
"If my husband and I think a project is right, we jump, we are risk-takers", says Silvia.
But as they knew nothing about Internet, they immediately looked for partners.
SEARCH FOR PARTNERS IN BUSINESS
Their choice to look for partners in the business rather than hiring people, was motivated because Silvia and her husband Michael knew that the new Internet venture would need a solid basis of people. Especially, as it was financially risky. They had calculated that there was to be no revenue, no room for salaries for the first year. They wanted to share that risk with people who were totally involved for the long term, and thus equity partners was for them the only option.
"Most of the businesses in the fashion internet industry, hire a lot of people from the start, then the risks are enormous. We kept the risks at the start relatively low, because -other than Net-a-Porter-, we do not hold stock, it's all on commission. We ask for samples of what brands have in clearance. This means that in the beginning, we needed less capital to set up the structure, we needed a website, great fashion buyers, and financial knowledge. We bootstrapped for the first 3 years"The partnership they entered into with brothers Nish and Sach Kukadia was based on trust and mutual interests. They knew each other because Silvia and Michael had worked with their family before.
Each of the partners had their own role, everything was clear, Nish from the internet industry, Michael had knowledge of people in the fashion industry and Sach helps on ground contacts and represents what young people think, while Silvia has the knowledge of the trends in the fashion industry.
Secret sales started with all four of them in the basement of Park Royal with equal equities. For Silvia, it was like a puzzle, each part was essential to the start of the business.
As Silvia confirms:"We had no partnership agreement really, all agreements were verbal for the first 2,5 years."
SEEKING OUTSIDE INVESTORS
Silvia continues, "Getting your website known with your target audience is the hardest and most capital intensive part of the business. I think the internet industry is very challenging; it's not what people think it is, to just set up a website and the audience will come to you. A lot of investment is needed to be seen and known on the Internet. Our website was redesigned 3 times!"
Because of this, they knew from the start that they needed investment at some point.
As they were always working in the business, they did not participate in any networking events. Also, because all the partners had always self-funded their business, they knew nothing about fundraising, they did not know any investors.
Silvia says: "We tried First Tuesday, a networking event for entrepreneurs and investors", [originally set up by Julie Meyer of Ariadne, ed.], "it was a whole new world for us."
After starting to speaking informally to investors, they felt that they were not investor savvy yet, and that they needed to spice-up the corporate outlook of the company.
"We did do our own kind of due-diligence, we got an accountant, who cleaned up the financials, a lawyer, a broker etc.– And we realized we needed good contacts to be able to attract first class investors."
Through one of the networking events they went to, they met Ed Bussy – one of the founders of Figleaves – he offered to help out for free, and only later on as a consultant, knowing they were bootstrapped. It was a turning point for the team.
Silvia endorses: "You need one person who is going to open the doors for you, you need someone to hold you hand. We chose to initially only speak to entrepreneurs with industry and C-level experience who had done it before, who had raised finance, and not to investors. We did not want to ask advice from investors, because it would immediately give a bad image, that we did not have experience with fund raising, we were very committed to look professional."
It was this consultant-adviser Ed Bussy who managed SecretSales towards a strategic partnership with Brandsforfriends, the large private sales company which started in Germany, a landmark investment it was called in the press. It meant for SecretSales that they got all the experience in-house needed to make the big jump towards audience and turnover in the UK. "Brands4friends is a big asset for us, because of their knowledge and experience, they are a leader in Germany," says Silvia.
ANY THOUGHTS ON DECISION MAKING, TEAM PLAYING, NETWORKING?
Silvia concedes that she is rather a team player, while her husband is more an independent decision maker. "I like the teamwork, and I like to listen to people for advice, and then decide in the team what to do. What strikes me is that decisions around investment as well as quick and snappy decisions are made by the men in the team. I always take my time to think, I need to sleep on it, but once I make a decision, I stick with it, as the right decision."
In her decision making, she hardly goes to other entrepreneurs, to ask what they think. "The last years we were so concentrated and focused on what we were doing, that we didn't think or have the time to meet other entrepreneurs."The person who really pushed us is Ed – he gave a lot of confidence."
Now that they are more settled, she feels more relaxed about meeting others. She recentlywas in contact with Sarah Curran of MyWardrobe.com.
Reluctantly, she says that before SecretSales got the outside strategic investment, people made them feel like they were nothing, just a small startup. And that it all has changed with BrandforFriends coming on board. "It felt like a ticket that says: 'what SecretSales does is good!'
"It has indeed give us strength, power that we did not have before. We feel stronger and more secure and sure of ourselves – people believe in us."
But, still Silvia is not the type to go speak at a conference to say how amazingly well they are doing. Her focus is on brand, customer service, SEO, to keep quiet and build a business and not based on 'pure air and noise'. On the other hand, she says: "Maybe other companies have different strategies because of the stage of funding they are in.".
ANY TIPS FOR OTHER ENTREPRENEURS?
Silvia smiles: "As an entrepreneur you have to act quickly and move quickly when something doesn’t work, so flexibility is key., and to cope with failure. Also, you need to know that in the internet, the leader takes it all, so you have to define your market, maybe geographically. We for example never had the intention to grow internationally, but that may change."
She adds: "And the persons setting up the team are important, contacts and experience does matter, we were already good in what we are doing, and we elaborated on it. And take for example Natalie Massenet. She had all contacts, she was the perfect representation when she started to set up her fashion online imperium. Her personal branding of her company made sense, because every body in the fashion industry knew her."
And finally, she adds: "Choose your investors wisely, investors can be your best mentors. However, Investors can be very picky, a lot of investors for example did not like the combination of a couple and brothers, so you have to have take that into account in looking for investors."
And who does she like to meet and discuss business? "Natalie Massanet", Silvia says.
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