From basement to a billion
Date: February 12, 2016
Name: From basement to a billion
Presenter: Sean Clark
Inspiration is the driving factor for young entrepreneurs. Moreover, inspiration can also trigger young entrepreneurs’ motivation to go forward. Brainstation Vancouver invites Sean Clark, the co-Founder of Shoes.com, to share his experience of entrepreneur journey. Sean Clark will reveal his turning points in his startup. In this presentation, young entrepreneurs will learn the mindset behind this leader of e-commerce industry in this generation.
Sean Clark is the co-Founder and the Chief Revenue Officer of Shoes.com. In addition, he is also the co-Founder of Shoeme.ca. Sean Clark left the position at Coastal Contacts to pursue his dream in e-commerce industry. Sean Clark is the first successful entrepreneur who operates premium shoe retailer in Canada online. In addition, many young entrepreneurs consider Sean Clark to be the new role model in e-commerce in this generation.
Sean Clark’s dream started in his parents’ basement. He considers his root of success all begins in the basement. In fact, he believes he is only half way there.
In his 20s, comparing with other places, Vancouver was not an exciting city. Clark had the thought that Vancouver does not have the ecosystem that will afford to compete with other cities. Clark decided to travel everywhere and this had opened many new perspectives. Clark considered travel experience is the best way to build up his education. Until he met his soulmate, who lives in Richmond, he decided to set root in Vancouver. This choice changed everything for him.
While pursuing his Master, Clark had the eyes set on the e-commerce industry. Clark believed e-commerce is the frontier of innovation. He knew where he wanted to go. He sought the opportunity to meet with Roger Hardy, the current CEO of Clearly Contacts, to gain the opportunity to work in the Corporate Development team for his internship. After completing his master, Roger Hardy reconnected Clark and hired him to work in Costal Contact as the Regional Manager in Sydney. In this position, Clark learned the structure of e-commerce. He also got the opportunity to look at the whole e-commerce in a larger scale.
In 2011, Zappos announced the company will officially exit the Canadian market. Clark realized his opportunity has finally arrived. He resigned his position in Coastal Contact and moved back to Vancouver to pursue his dream.
Clark admits he did not know anything about shoes, but he knew there was a huge demand of shoes. Based on statistic, it was a 7 billion dollar market and only 2% were purchased online. Until Canada is caught up the market, Clark bet online shoe business will eventually drive up to 10%.
With the help of his friends, Clark managed to retrieve the list using API from other online sources. Clark was able to provide shoes options online for buyers and sell them in advance. The online traffic showed many places are sold, and the system was working. Clark would buy the retail products from other places, send and package in the basement, and mail it to buyers.
Clark mentions he tried to promote his company in many trade shows; however, no one signed up and also got kicked out of the show. Eventually, he figured out the reason.
“Brand A is needed for brand B and brand C”
Clark changed his strategy. He uploaded the brand B and brand C products on the webpage and showed to brand A. He convinced brand A that brand B and C are in the business, which forced brand A to be part of the system. He took down brand B and C products from the website and upload brand A products. He went over to the brand B and C and convinced them brand A is already in the system. He successfully got brand B and C to sign up with his company.
“Influencer is important”
Clark only picked certain brands because he had confidence that other brands will eventually join. Even though many major brands signed up the company, the company was facing the problem of insufficient cash flow. Instead of going with traditional purchase order routine, Clark convinced all suppliers to adapt distribution landscape strategy, which is pay after selling. Clark had the vision of all brands to go direct online, which would take down all the barriers of entry.
Sales were increasing, and company did not purchase anything. However, Clark was experiencing many personal challenges, such as health. Whenever there was obstacle, Clark would push through it. Life style had been changed dramatically for Clark.
Two years later, the company was running out of cash. Clark needed to fire a half of his staff members. He was done. Because of ego, he did not want to listen to anyone. He got kicked out and lost his family and friends. He called it his rock bottom moment. His brother took him in and He decided to change. He called his life coach and started to seek for support. He wanted his life back. After He surrendered, the company sales went up. When he sold his business, he started to try Icon Man competition.
Clark believes the challenges have been changed and the culture has differences. It does not matter how much he struggles because life is a path. People need to go through life the best they can.
“3 steps forward, 2 steps back. Success has no short cut”
Questions and Answers
To face Amazon, Clark believes the company needs to differentiate from United States. The company needs to give people the reason to come back. The company provides a story for people and Shoes.com is still remained one of the biggest buyers in Amazon.
The Iron Man training helps Clark to release pressure. It reminds him the important values he has. Clark indicates the company was facing the insufficient cash flow was caused by underestimating the rate of cash burn and overestimating the flow of income revenue.
Clark mentions he is lucky to meet Roger as his mentor. There is a pattern in e-commerce and Roger is the one who shows him the pattern. Young entrepreneurs cannot do everything on their own. Clark suggests young entrepreneurs to be in a mastermind group.
Whenever there was IT issue, Clark would call Shopify customer support. In this age, resources are everywhere. Clark believes sometimes young entrepreneurs need to have the confidence to convince them things people do not believe. This is a sales skill. Young entrepreneurs should promise the moon and sell the dream.
Shoes.com will open a retail store in Vancouver in the future. They are not opening the store to sell shoes; in fact, this is a marketing strategy for Shoes.com to share the brand story every month.
The logistic has changed from basement to warehouse. Clark emphasizes “Light assets” is the key. The company will leverage the dropship and sell products before they pay for it. Many competitors are throwing the company under the bus. The competitor advantage Shoes.com has is that they are outspending every competitor. Speed and capital are the key to success for Shoes.com.
Originally, Clark only has Shoeme.com as the domain. Shoes.com was owned by a big shoe company. Because of acquisition, the company acquired the domain.
MBA helps Clark to present in a group effectively and efficiently. The social capital is what MBA brings him in business. Clark reveals the company’s return of customer is 40%. Shoes.com uses Twitter and Facebook for social media. Both generate significant amount of organic traffic to help the company’s organic result.
“From basement to a billion, and we are only half way there”
