These UK Female Entrepreneurs Have Raised Almost 30 Million Dollars
With all the doom in Europe, about the crisis, I think it's important to note that there are companies that are optimistic and growing. One of them is Notonthehighstreet (UK), an e-tailing platform for online retailers. The company was started some six years ago by Holly Tucker and Sophie Cornish, two female entrepreneurs with a media and marketing background, and we have covered their success in our own online magazine from the start, for example when they won multiple awards.
The company has always been very ambitious in its plans, and as they follow the 'motto', 'the winner takes all', they use outside funding to scale fast. Just before the summer they raised another round of funding, series D to be precise, and so I thought it's time to see what they are up to.
The funding round was £10mn (€12.4mn) in a Late Stage round led by Fidelity Growth Partners Europe with participation by Greylock and Index Ventures.This makes the full amount of funding close to 30 million US$, and that's really something that is remarkable. So what makes them so succesful?
On notonthehighstreet, small shops are able to upload their shop and sell their goods. Since launching in 2006, the site has grown from 100 businesses to over 750 in 2008, selling everything from fashion to homeware, fragrances and jewellery. In 2010 that number had doubled to 1,600 shops that were selling through their platform.
Now, according to coverage by venture blogs, that number has grown to over 3,000 and its range of products from 35,000 to over 50,000. We understand that retailers are applying to join notonthehighstreet at the rate of 40 a day, but the company is still keen to retain its niche cachet and quality ethos. The vast majority of applicants are thus refused.
Scaling the business required a bigger management team than only the 2 founders, so at the end of 2011, they hired Jason Weston, formerly of Amazon, as COO and Mark Hodson from PayPal as CMO.
How does the company get traffic to its website? The company launched a UK TV advertising campaign in 2012. In the companies marketing mix is also a 8-series of themed catalogues. The mobile version of the site was launched in 2011. And their PR has always been impressive, just as their number of awards, with the latest the Entrepreneur of the Year award of Growing Business UK.
90% from the sales come from the UK, but the website also wants to attract foreign buyers.
Thus the website also launched a multi-currency payment facility, allowing merchants to accept payment in US and Australian Dollars, Euros and Pounds Sterling. A great marketing move to drive sales.
Another branding exercise was that the entrepreneurs also launched their first book, ‘Build a Business From Your Kitchen Table’, with the aim of supporting more enterprises and encouraging start-ups in the UK.
What can they do better? Increase the value of the brand. According to venture specialists, despite the company’s success, it has not attracted the same brand recognition as other British e-tailers such as ASOS and Net-à-Porter. Therefore, the company wants to use this round of investment to strenghten the brand in the UK. In addition, the funding will also allow the firm to open offices in its major overseas markets, which will help their international brand.
This latest round brings total investment in the firm to almost £20mn, i.e 30 million US$ and gives the company an equity value of just over £60mn. In other words the value of the firm has more than doubled in the past twelve months, according to venture specialists, and the IRR sofar has been over 80%. Their investors are happy with this, we assume.
We are keen to know how the company is doing, investor Fidelity Growth Partners Europe demands that the companies they invest in meet significant growth hurdles – more than 100% year-on-year growth for companies with revenues of €1-5mn and more than 30% year-on-year growth for companies with revenues in excess of €5mn. So notonthehighstreet cannot sit still at all, but needs to act fast to meet those numbers.
Is notonthehighstreet going to realize this grow themselves, or are they on the acquistion track?
I have a tip:
They might want to look to work with Flavourites, a Dutch website with a similar business model and 1500 e-taliers, that is doing very well. And also set up by 2 female entrepreneurs, Natascha Klootsema and Marije M. Mulder.
We' ll see what's next for notonthehighstreet.
See Sophie Cornish talk to Techfluff TV about her column in Stylist Magazine and NotOnTheHighStreet.com:
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