In a time when a growing number of Poles are having their say in fashion design, two young entrepreneurs have established a website that helps sell their products
by Kamila Wajszczuk
Michał Juda and Jan Stasz have known each other since high school. Before they started their fashion e-commerce firm Showroom, they cooperated in organizing events and then ran an interactive agency, Filemon & Baucis, which worked for a number of renowned brands in Poland.
But the agency did not prove to be challenging enough. “We were looking for something different,” Juda said. “It happened that our friends had just created their own fashion brand. They came to us saying that they don’t really know how to take care of online sales.” So the two entrepreneurs created an app, named Showroom, for the designer friends to sell their products on Facebook.
Observing sales carried out through the app prompted Juda and Stasz to examine the potential of the independent Polish fashion market. So they set out to the Łódź Fashion Week and talked to designers individually about their idea. “We got very positive feedback, they all said the app looked good and they would be happy to try and use it,” Juda said.
This set them on the right track and soon they were launching similar apps for the designers they had met. In January 2012 there were already between 30-40 of them cooperating. It was then that the two men decided to create one website to market all of those brands, which they called Shwrm.pl.
Smart ideas, smart money
They soon knew that it was time to look for an investor. “It was the right moment, with e-commerce growing in Poland, especially the fashion segment,” Juda said. A number of venture capital funds expressed their interest, but Juda and Stasz decided to choose the offer presented by HardGamma Ventures.
The fund acquired 20 percent in the company in exchange for seed capital. Showroom continued to grow and soon secured a sector investor, Burda International. Now Burda holds 25 percent, HardGamma holds 15 percent, and each of the founders controls 30 percent in the company.
Over the two years that passed since the company was created, a lot has changed. “Everything – the website, the approach to customers, the team – is different than it was at the beginning,” Stasz said. “We have also changed a lot compared to what we were two years ago.”
One of the things that has not changed is that it is the designers who are the stars at Showroom, Stasz added. “They are the most important, they always were and we hope they always will be.” Some 300 designers currently sell through the website.
Another key thing is good relations with investors. “We are not simply looking for money and focusing on the amount secured in subsequent financing rounds. We would like to get smart money and see added value in investments,” Stasz said. HardGamma gave them know-how on managing a start-up and business contacts. Burda provided them with know-how on fashion, traditional media, especially from the fashion segment, as well as an international outpost.
Showroom has also always paid attention to customer service and good navigation around the website. Most of its clients are women, but it is hard to specify an age group. The aim is to reach the widest possible crowd.
With the help of tools such as remarketing, or ads aimed directly at a customer who has already been to the site, Showroom tries to establish a long-lasting relationship with its users. “In e-commerce its important to minimize the loss of clients, which happens at every stage of the purchasing process,” Juda said.
Local and unique
They operate in a niche market, but one with a lot of potential. “In the past few years we have witnessed a boom in independent fashion in Poland,” Juda said. “Poland has always had a lot of spinning mills and sewing facilities. Thanks to that, Polish designers have easier access to producers than their colleagues from the West.”
Independent Polish fashion has significantly increased its presence in sector media. Almost all Polish fashion magazines now feature brands that Showroom has on offer. To help promote them, the company has set up a traditional showroom in its office, for wardrobe stylists to choose clothes and rent them out.
The company is trying to get the best out of global trends developing in Poland right now. “The first one is the trend for everything local. It is getting increasingly important for customers to know where a product has been made, by whom and from what kind of material,” Stasz explained. Another is the quest for unique things, designed by individuals a customer can relate to, he said.
Growing and learning
The plan for the next few years is to “grow, grow and grow,” as Stasz put it, together with cooperating designers. Showroom would like to remain the leader of its market segment and ensure the segment itself grows as well.
Juda and Stasz are planning more presence abroad, mostly in the West. The website already has an English-language version, but there is need for a more systematic approach. Poland is a large market by itself and a new e-commerce site usually take a long time to conquer it before even thinking of foreign expansion, Juda said.
For the founders themselves, the goal is to continue learning. Juda graduated from the Warsaw School of Economics but says that his management skills have come from actually running companies and not from academic knowledge. He hopes to find out even more as Showroom develops. It is also important to make the core business fairly independent, so they can focus on new directions. Stasz gives a nod to these goals and adds that he would like to be finally able to go on vacation, a wish expressed by many entrepreneurs working hard to develop their business.