Startup Diaries: Lessons Learned at a Business Accelerator
Vicky Brock's company, Clear Returns, which enables online retailers to boost profitability by reducing return rates, was a winner at IBM's Smartcamp, part of the IT giant's Global Entrepreneur Programme. Here she shares her top ten takeaways from the experience.
I’ve always been a terribly ‘difficult’ shopper, but also felt that we could live our fast-paced urban lives more sustainably. As an entrepreneur, I’ve found that I can harness these contradictory characteristics in my latest start-up venture, Clear Returns.
I’ve been that demanding shopper, and on occasion, the ‘customer from hell' in Britain’s high streets. Despite having limited time to really hit the shops, I would be the one taking shoes back to the retailer or returning that box to the online store. I wanted the shoes to be a perfect fit; and I knew from commercial experience that things could be made better.
With all the choice in our lives now, we could make more targeted use of resources. My career, setting up an analytics program for HP and then starting my own research company years later, only confirmed my views. In my first graduate job, I showed my theatre owner employers that well-placed posters would work better than handing out flyers to random passers-by.
My new company Clear Returns uses predictive analytics to reduce returns and wasted effort and materials in shopping.
People in Britain talk of the death of the high street from rampant e-commerce but eye-wateringly high product return rates – up to 30-40% in fashion – badly affect virtual businesses’ viability too.
Our company systems trawl through customer transaction data, taking real time feeds from different financial, warehouse and e-commerce systems to predict which products will be returned or see customer satisfaction issues. We spot the trends (or warning signs) earlier than traditional, often disjointed, business systems are able to do.
We have also developed a software tool that segments customers based on what they keep; retailers can find the valuable customers they are disappointing, but also costly ‘wear and returners’. This gives retailers new options for satisfying those shoppers that disproportionately drain away retail profitability: restricting online choice or adjusting returns policies for them to reduce the business’ financial losses.
Every business owner knows a long-term relationship's value. Many very creative or innovative retailers know they’re missing out often at the first or second interaction with customers: they haven’t quite got a product’s final specification exactly right or maybe they haven’t matched the mobile app’s product descriptions exactly to the merchandise.
If retailers can instantly find tell-tale signs from the daily torrents of data, they can make critical changes in days, rather than weeks.
We can be more responsive and unlock that profitability. And hopefully, we can make everyone’s life a little simpler and sustainable too.
When I started Clear Returns, the goal was to build a high growth, global business. I also knew we had to work very closely with big retail IT systems, so getting the right team and right partners in place has been critical. I had started a company before, but not on the same scale, so there was an element of learning and getting insights at every stage of its growth.
At the outset, I took the company into Entrepreneurial
Spark, a Glasgow-based incubator, so we could focus on growing the company in a
supportive environment. The Scottish Government helped me secure a place
at entrepreneurship courses, including MIT’s Global Entrepreneur Development
Program, the boot camp for high growth tech entrepreneurs. This
"think big" mentality has been hugely important both from a strategic
and a confidence perspective.
But winning IBM Smartcamp in Dublin was the most significant step for us. SmartCamp is part of IBM’s Global Entrepreneur Programme, which aims to support start-ups beyond ‘one-off’ technology boot camps. It’s part of a growing involvement by global firms in mentoring innovative small start-ups over the long-term.
All the entrants pitch their company proposition ‘Dragon’s Den’ style, but the successful ones open up strategic guidance and infrastructure development at the event and in the months that follow.
Presenting at SmartCamp is a tough learning exercise that forces you and your team to really focus on your value proposition.
The win helped us gain seed funding to underpin our software development and testing. We've had incredible access to IBM expertise through its Global Entrepreneur Programme. While we've been in our pre-revenue stage, we have accessed resources like software developer licenses over time as we required.
We’re now working with high street and virtual retailers to pick out ‘hidden’ product return trends. Managements can then tweak merchandising or supply chains to boost customer satisfaction.
A consequence of that will be reducing the appalling amount of waste all across the supply chain that results from returns. Whichever way, we are looking to delight that very demanding, time-poor customer and stop the weary posting of that box back to the retailer. Maybe we will make their life a bit simpler as well.
The on-going challenge now is scaling rapidly, beyond the UK into other geographies. And again, that is where the guiding hand and the ideas from the relationship with a global firm and its networks are invaluable.
Ten lessons learned from joining the business accelerator
Looking back on our connection with IBM’s SmartCamp accelerator and the relationships that followed from it, we drew ten lessons from the experience:
1) External perception is everything
You may be scared, the product may not be finished, you may be full on in "fake it 'til you make it" mode - but this is the opportunity to get people to buy in to your vision, and that can open up the time and resources you need to accelerate execution.
It is very good for confidence and visibility to have a company like IBM endorse you. As a start-up, the lent credibility is priceless.
practice pays off
There is undeniably a performance component to pitch competitions. Practice is essential - treat it as your West End debut!
3) Graciousness and networking
Be humble, listen and connect - the exposure to the calibre of people in the room at something like SmartCamp is a special opportunity that you have to grasp.
4) You don't have to win, to win
The connections and opportunities are there for you to grasp - winning, while nice, is not essential. Maximising the opportunity is.
5) Be open to feedback – and be honest with yourself
A lot of people will tell you your baby is ugly. What they say matters. Take it on board, look for the common themes and assess whether your target market sees it the same way.
6) Get the strategy right, then execute the hell out of it
SmartCamp is an intense strategic planning session - allow yourself to take strategic input, then afterwards, on the back of the exposure, execute well and execute fast.
7) Filtering advice while avoiding conformation bias
This part is so tough: you'll get loads of contradictory advice and loads of feedback you don't really agree with.
You really have to avoid cherry-picking out only the bits of advice you like, as you're only deluding yourself.
the investment conversations long before you need money
Raising money takes ages, you can't wait until you need it - SmartCamp is a perfect place to talk with investors and successful entrepreneurs about their journeys. Then you can stay in touch.
9) Don't rule yourself out, go for it
Don't let self doubt stop you trying - stuff the ‘imposter syndrome’, just give it a go.
Even if you don't get selected, the process of focusing down on your application is good practice, and the more you try, the luckier you'll be.
beyond your own doorstep
We are based in Scotland and won SmartCamp over in Dublin; we went to the Berlin final and also won the Big Data Venture challenge in Rome. Don't limit yourself to what’s on your doorstep.
Vicky Brock founded Clear Returns in May 2012, a company which helps fashion stores and other retailers boost profitability and deal with returns of 40-50%. Vicky's on a mission to make online shopping work better for both the retailer and consumer, analysing data in real time in order to spot problems quickly, enabling retailers to solve these issues and avoid unneccessary waste. Vicky also co-founded Highland Business Research in 2004. Before that, she set up HP's EMEA analytics operations.
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