Part 1: WearYouWant Thailand fundraising story Part 1: How to get one million dollars?
In part 1, i’ve had an interview with Martin Toft – WearYouWant CEO about how did they manage to raise $1.5M.
Let’s continue with part 2 to see how can they spend this money and what is the most challenging thing in using money!
How long would WYW spend $1.5M? and any metrics, approach to define the way you spend this amount of money?
It all depends on how aggressively we want to expand (in Thailand as well as regionally). Of course we’re using budgets to define our spending, else it would be even harder to spend them wisely than to actually get them. So, I can’t tell you how long it will take to spend the money, as it very much depends on how soon you’ll see WearYouWant operating in neighbouring countries.
How do the VCs disburse the money? e.g how many phases and conditions? or you guys already have $1.5M in WYW bank account?
In our case it was disbursed at once, but it very much depends on the state of the company and the VC’s.
Mutual trust is of course essential, and a proven record of achieving targets in the past also influences the willingness of the investors to disburse the full amount right away.
A large proportion of the money will obviously go to marketing. We’re at a point where taking market shares and establishing ourself as one of the major players in the market for online fashion is key to success. Besides that we’re still growing the team and actively looking for key positions such as COO and CMO.
We’re at a point where taking market shares and establishing ourself as one of the major players in the market for online fashion is key to success.
The top expenses during the first 6 months will obviously be to set up all the operations, office etc.
And do they provide any metrics to measure the effectiveness of spending their money? for ex cost per acqquired user/customers…Yes, we do have metrics for cost per first time buyer etc. These are of course important numbers for us and the VC’s combined with a range of other elements such as business development, PR, tech improvements etc, which are considered important for the success and expansion of WearYouWant.
How can WYW with $1.5M compete with Lazada and Zalora with more than $150M?
First of all they are two very different businesses. First one obviously has a different look and positioning in the market. We’re not trying to expand in to other categories such as electronics and home appliances, and because of that we can focus only entirely on fashion and beauty. Also, the money the above mentioned companies have raised has been split over the region and not solely for Thailand. Besides that, both are running their own warehouses, with inventory, stock control etc. Our operations are much leaner and as a consequence of that our costs obviously much less. That being said we need to have a slightly different focus, and the launch of our new design clearly shows that.While they are being busy focusing on their own cheaper labels and pushing them hard to the market, we’re more interested in the well known premium fashion brands, both international and local.
Of course we do, and this process has already started. Securing enough runway for expansion is one of the top priorities at the moment.
The most challenging thing is still that Thailand is an emerging market when it comes to e-Commerce. Therefore, it takes time to find out how to optimize the online marketing spend on various channels.