Malaysian Startup Fashion Valet Spills All On Their Mistakes, So You Can Learn From Them
On the third day of of MA2016, Fadzarudin Anuar, co-founder of Fashion Valet took to the stage to present, “Growing Through Mistakes”. He shared several stories about the growth of Fashion Valet from its founding in 2010 to becoming the online store it is now, carrying over 400 brands from SEA, open in 3 countries and delivering to 10 different countries.
Vulcan Post also sat down with Fadzarudin after the session to get a few more stories, and here’re some of the lessons he and his team learnt along the way.
1. Don’t try to be different just for the sake of being different.
In the early days of their startup, Fadzarudin shared that the team wanted to try and be special. So, when it came to choosing the domain name of their website, they went with the .net option, in a hope that it would make them stand out in the sea of dot coms out there.
This instead backfired in more ways than one. First, whenever there were writeups about them, their linkback would wrongly be published as FashionValet.com instead of .net, leading to some confusion. After this happened too many times, and the team got tired of explaining the reasoning behind choice, they decided to acquire the .com address.
The owners asked for 50,000USD for a domain name they had paid a pittance for. It was only through intense negotiation that the Fashion Valet managed to lower that down to 9,000USD. They decided to fork out the cash, but it was a lesson that they would remember.
2. Trying too many things out at a time drains your resources.
At the beginning, Fashion Valet tried to appeal to too many markets. Despite their limited resources, they had many categories on their first website. They realised that this was stretching them too thin, and they decided to focus on women.
Even today, now that Fashion Valet is bigger, they still have to be deliberate in choosing their collaborations with others. Although they meet many people with exciting ideas and things to do, they have to reject them because of realising what it is that the team should be focusing on.
3. Don’t follow the competition, avoid knee-jerk reactions.
After Fashion Valet had been around a year or so, competitors began to emerge, offering cheaper deals on their websites. Traffic started to drop, and Fashion Valet figured that their competitor, Zalora had a good thing going.
The thought they took away was, “Customers appreciate variety, so we shouldn’t limit variety.”
They ended up taking in many different brands, even low quality brands, in order to achieve this, but sales did not improve.
This went on until they received a call from a long-time customer, telling them she no longer enjoyed browsing their website and didn’t look forward to what they had to offer. The Fashion Valet team also realised that they personally didn’t take pride in their own website and the products they carried.
It was a good wake-up call, and the Fashion Valet team made the necessary changes. They dropped all the lower quality brands they had signed and reached out to the designers instead, telling them “We’ll work with you guy exclusively, if you’ll do the same.”
The sales picked up after that, and the team found that they found joy in working once again.
4. Micromanaging doesn’t work long term.
With the growth of the business, the team also continued to expand. They went from 30 to 75 people in 6 months and were still actively hiring.
Fadzarudin shared that at one point, he and his co-founder, Vivy Yusof were in multiple WhatsApp groups and met with all their departments daily. He joked, “WhatsApp groups are the worst things to happen to any company. Everyone wants to be in the same group as the co-founder.”
He would get hundreds of emails daily, seeking his approval for projects and releases. Basically, the founders were doing too much and were not delegating to employees.
The lesson seems to have hit home for Fadzarudin, who said, “The best thing about growing your own company is that you realise the potential of people is unlimited.”
Nowadays, when hiring and when working with people, the founders tell them about the company values and vision, so that they become an extension of the original team. As Fadzarudin said, “They don’t come to us for everything for approval and we expect them to manage their departments.”
5. Learning to manage and deal with people is important.
According to Fadzarudin, “No one teaches you how to hire people and fire people in a startup. How do you manage people?”
As the company continued to expand, roles would change. When trying to add structure, there would be people who would be offended if someone they were working closely with before was suddenly elevated over them.
Fadzarudin also struggled with implementing structure into Fashion Valet’s operations. Referring to this, his thoughts were: “We’re a startup, we shouldn’t have a structure. People should have free rein to go and innovate the company when they want. But I learnt that when you’re a big company, it’s hard to touch base with people. It’s more beneficial to the employees when you have a structure.”
6. Never neglect financial management.
Fadzarudin said that from the start, financial management was important to the Fashion Valet team. They were very careful with managing the cashflow, but found that when their revenue was growing, they became a bit more ambitious.
He shared that at one point, they had hired too many people and ended up having to be open and honest with their employees. They had to gather them and tell them that they simply didn’t have enough to pay them, and that if revenue didn’t pick up, they might have to let some go.
In the end, there was a silver lining, because through the open dialogue that was established, their team was more willing to give suggestions about how things were done to help out.
7. Be strategic with your marketing choices.
There was a point when Fashion Valet spent a six figure sum on online marketing, only to see no change in their sales.
They realised that they needed to change the organisation their campaigns and use different channels and mediums. For Fashion Valet, what they found effective was a combination of TV ads, billboards, reaching out to online influencers on top of online marketing. Fadzarudin also suggested that marketing should be done in waves over time throughout the year, rather than be happening all the time.
Malaysian Global Innovation and Creativity Centre (MaGIC) aims to build a Sustainable Entrepreneurship Ecosystem by catalysing creativity & innovation for long term nation impact. For its third installment, MaGIC Academy (#MA2016) has gathered serial entrepreneurs, founders, philanthropists, investors, corporate leaders and startup enthusiasts from across the globe.
Source: Vulcan Post