Argentinian Entrepreneur Manuela Arnedo: My Winning Opening Line to VCs
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Manuela Arnedo is the Founder of Trendsetters, a place to shop for fashion in LATAM. The site currently provides e-commerce of fashion flash sales for the Argentinean customer. In 2011, Trendsetters was part of both Startup Chile and NXTP accelerators.
Manuela began her career as a trainee while developing a digital project for HSBC Bank. After this experience, she went to work for an ad-network agency. She then launched a digital marketing agency that designed online PR and e-marketing campaigns for high-end brands such as Coca Cola, L'Oreal, Dove and Stella Artois. For the last two years she has embarked on a new challenge: Trendsetters.
Manuela holds a BS in Business Administration from the Universidad de San Andres as well as a MS in Finance from Universidad del CEMA, both Argentinean institutions. She can be followed at @ManuelitaAB.
Adriana spoke to Manuela about why LATAM is a perfect place for copycats; the technology she’s most enthusiastic about; and her opening line to VCs which guarantees their attention!
AG: How did you come up with the idea for your company and then arrive at the decision to turn your idea into a reality?
While working in the ad-network industry, I saw a big opportunity not in paid media but rather in owned media. Specifically, I saw an opportunity in web content generation.
Trendsetters.com incorporates both, web content and e-commerce. Given that I had an understanding of the Argentinean Internet user, I decided to go for a B2C model.
At Trendsetters.com we are focused on creating relevant content. We only display trendy fashion. We are very honest about pricing. That means a discount is a real discount. With regards to product delivery, we have optimized the logistics. In order to do so, we have our own distribution and delivery system in house.
AG: What is your business model?
MA: We create fashion content to create awareness. With regards to our revenue model, we buy in bulk and mark up the products.
AG: When you built your team, what are the key qualities you looked for to ensure the success of your business?
MA: People on our team set fashion trends. As such, we look for highly confident team members capable of spreading a fashion trend. They need to breathe fashion.
In addition, we look for good-looking women capable of closing sales. They need to be highly comfortable in flash sales business development.
AG: Who were your first customers and how hard was it to attract them?
We launched our company via a very large event. During the event registration, we used an iPad to allow all 600 people to join our webpage.
Then we asked that all attendees invite all their friends to our page. With this methodology, we increased our user number to 10,000 potential customers. Currently our monthly visitor growth is 10%. Our client base increases 60% organically and 40% through advertising.
The best marketing strategy is to have relevant products. If you have a good online product, people buy.
In addition to buying, users create virality via social media channels. I also think that it is critical to have an optimal user experience on the site.
AG: What is next for your company?
MA: In our close future we want to expand in LATAM. Initially, we are going after the interesting markets of Colombia and Mexico. Currently we are still in the process of optimizing our site from the efficiency standpoint. I am waiting to have an optimal site prior to expanding.
AG: Do you lie awake at night sometimes thinking about the company? What aspects of it specifically keep you awake?
I think a lot about scaling. I am aware of very large competitors capable of buying inventory in very large quantities.
I also know that there are bigger fashion markets than Argentina. I am trying to reach a balance bewteen optimizing the site enough and expanding to larger markets.
AG: What has been your biggest challenge throughout the history of your company, from planning to funding and execution, and how could others learn from it?
MA: One of our biggest challenges was to transition from a B2B model to a B2C. It seemed that everything was hard: understanding the business model, managing a good product mix, developing a good user experience, designing a profitable business model and diminishing the cash loss due to logistical errors. These are all very important elements of our business and in order to be profitable, one has to master all of them. With our current model, the biggest challenge will be to scale.
So far, our most significant success is to have passed the break even point.
Currently we have optimized our fashion campaign design. Our site is very relevant. We have incorporated home décor elements and gift suggestions in addition to portraying fashion accessories and clothing.
AG: How have you found angel investors’/venture capitalists’ attitudes towards you as a female entrepreneur?
MA: I think that being a woman in LATAM is an advantage. Given that there is a larger number of male entrepreneurs, VCs are actually looking to have more female-led enterprises in their portfolios. Portfolio heterogeneity is very important.
In addition, from a cultural standpoint, LATAM males feel awkward saying “no” to a woman!
I always introduce my pitch as: “As a polite LATAM male, you are not going to say “no” to a woman, are you?”
This phrase guarantees that I am being listened to.
AG: What kind of technology are you most enthusiastic about and why?
MA: By far it would be Data-mining. Data mining allows us to personalize the user experience. In our site, we capture the number of items that a given user purchases, his/her research history, exchanges and time spent looking at a particular item. Data mining allows us to give personalized attention to our users and helps us keep fraud under control.
AG: Historically, people see Latin America as a big market for copy cats, especially in ecommerce. Do you see much real innovation coming out of the Argentinian startup scene?
MA: I believe that LATAM is a perfect place for copycats. Silicon Valley possesses a very mature innovative scene and plenty of money. The American market is very mature and consumers are much more difficult to please.
I believe that LATAM copycats are a safe bet. In a way, they come to the table having shown previous success.
If an entrepreneur desires to be really innovative, he/she should think of the American market, where there is much more risk capital available. I think there is innovation in companies such as GroovingAds and ADTZ.
The translation of this interview from Spanish was undertaken by Adriana Galue, who takes 100% responsibility for its accuracy.
Based in Boulder, CO Adriana Galue, started working with web startups following a career in Neuroscience. She is truly passionate about technology and entrepreneurship. In addition to owning a consulting company, Adriana teaches seminars in entrepreneurship applied to technology in several South American universities. For more information about Adriana, see her profile.
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