How to Go From Bootstrap to $40million in 18 months – Zaggora
CEO Malcolm Bell reveals all at Forward Partners event in Shoreditch
Gathered in a presentation room at The Trampery – Shoreditch’s first startup workspace – during the dog days of August, things were getting ‘hot’. In fact, we were all gathered on this Summer evening at a Forward Partners event to hear how Malcolm Bell and his wife Dessi, created the ultimate in hot startups – Zaggora.
Steve Gledden, Forward Partners’ interim COO and host of this event, painted the big picture about how Malcolm and Dessi had achieved the very definition of ‘capital efficiency’ – creating $40m in revenues in just 18 months, with no external investment.
With a big personality and a beanie hat to match, Malcolm Bell took to the stage to take us through his journey and share a few tips for the many budding entrepreneurs in the room.
Evoking Reid Hoffman’s famous quote: “Starting a company is like throwing yourself off the cliff and assembling an airplane on the way down,” Malcolm described how, with no previous company experience he co-founded and runs a global business success story and is a now a Guest Expert in Residence at Harvard Business School.
And it all started with magic shows.
Yes, this supercool entrepreneur started by performing magic shows at home; putting up posters around the house and selling tickets to his family. The man was born to be the centre of attention and has selling in his soul!
But as he grew, Malcolm discovered that his actual superpower wasn’t magic, but reading. And after sharing his list of books any entrepreneur should read, he singled out Seth Godin’s seminal work Purple Cow – which ultimately challenges business owners to ask ‘how is it that you get people to care?’ – as the key text at the core of any new business.
So how did Zaggora get people to care?
Luckily Dessi cared a lot. In 2011 she cared about working out; she cared about looking good for her wedding to Malcolm and she cared a lot about quality. Her mission: to deliver a better workout and help women be healthier, happier and ‘hotter’.
Zaggora’s Hot Pants™ were born. When every other company was helping people feel cool during a workout, Dessi created a massive differentiator by making them hotter. And why should people care? Because the evidence was that the Hot Pants made any workout more effective and increased the weight loss effect that many were looking for.
Starting-up just five years ago, Zaggora now has one million customers in 154 countries. So what did it take to get there?
There’s no doubt that with their background in finance, both Malcolm and Dessi started off with great business nous. But there are plenty of other skills and essentials that are needed to create an online business.
Here’s some that Malcolm Bell’s talked about:
- You need persistence and focus. Malcolm personally posted 3,000 tweets offering free Hot Pants to get 500 reviews. Yes, the police were called at one point – man asks woman on Twitter for her address to send her free hotpants is going to sound suspect – but he got his positive reviews!
- There is no ‘one thing’ that is going to guarantee your success. You have to continually hustle to get what you want and need from others.
- Realise that time goes fast when working on your own business.
- Build a product people want – sounds easy – hard to achieve in reality. What is the problem your idea is solving?
- Get customers and sell product – obvious? Not to some businesses you see.
- Get customers before launch – find the early adopters and users before the official launch. Write a press release and define why your product matters.
Hire a phenomenal team. Build a great team culture.
Raise money if needed, but go as long as you can without the VC money.
Build a solid network of people who can help.
Understand the eCommerce Equation. Your mantra is ‘Daily Sales = Traffic x Conversions x Average Order Value. Optimise your traffic and conversion rate. It’s a continual process.
Plan well and create goals. As Denzel Washington says: ‘Dreams without goals lead to disappointment’
There can be no growth without customer retention. After initial great success Zaggora’s customers weren’t coming back. High quality product meant it didn’t wear out and Zaggora had nothing else to sell them. Now they’ve solved that issue with many other colours, styles and products – plus Zaggora is expanding into health foods and fitness plans. Exciting to see how it develops over the years.
Understand your customers. On Zaggora’s office wall in London’s New Oxford Street they have 1,000 Facebook photos of their customers to remind them all – why did these people buy from us and what do they want?
- Understand your key marketing channel. You ultimately need only one key channel: whether it’s adwords; Facebook ads; Twitter – whatever it is, own it and work it well.
- Marketing – make sure your brand imagery, your tone of voice, your brand and site design fit your audience. Do things that don’t scale, eg send personal emails to customers. It’s essential to build your social proof.
- And the last rule of all – There are no rules! What you are doing may never have been done before – it’s up to you to make it work.
Thanks to Malcolm and Dessi for great insights into the Zaggora business: a very inspiring evening and an impressive couple. Thanks also to Forward Partners for hosting this important event – giving access to early startup founders to those who have been through it for themselves.
For Marylebone’s insight into how you can launch a new product or grow your existing business, contact Jane Henry at firstname.lastname@example.org
And check out Malcolm Bell’s slide deck for yourself.