On a day just like today two years ago, the sun is shining and anyone with a business idea brimming with confidence, feeling like a million bucks. Three friends gathered around at a Belgian cafe in London, brainstorming ideas of what to do next. Already indentifying the need to do something mobile as they acknowledged that youngsters had made smartphones such an integral part of their lives.
They went around different ideas but came back to the core which was that people should be rewarded differently based on their loyalty to specific products and brands.
The first idea for Shopitize was born on that day, It started on a napkin, now It's on your mobile phones.
Hi Irina, How are you doing, great to have you on YHP?
Hi Joseph, I am well, thank you. Great to see that spring has finally arrived.
Could you quickly give us some background information about yourself? Tell me about yourself growing up?
I grew up in Belarus, which used to be a Western part of the former Soviet Union. I was 13 when I first visited the UK on a school exchange programme, and was very happy to return here in 2000, so I have been a proud Londoner for the past 12 years. I’ve been educated in the US and The Netherlands, and most of my career has been in investment banking advising and structuring equity and debt transactions for companies, banks and governments.
Who was your inspiration growing up and why?
I was lucky to study at a school in Belarus which has very strong selection criteria based on students’ abilities rather than family levels of income or social standing. It’s probably the strongest and most challenging peer group that I have ever had. Most of them are now living all over the world and are very successful in areas from theoretical physics to medicine. The strongest friendships that I have are from school, and in fact, one of my co-founders, Alexey Andriyanenko, is my classmate who I have known from the age of 10.
How did you get into business initially?
When growing up, I did various jobs. My first was selling advertising for the first ever edition of the Yellow Pages in Belarus. I was 16 at the time, and the business culture in the country at that time was almost non-existent, as it was transitioning from socialism to wild capitalism. My other jobs varied from teaching English in Minsk and selling hot dogs during basketball games on campus in the US to being part of the team that opened Ford in Belarus and doing analytics for a EU advisory service in Belarus.
I also worked for the Dutch bank who always had a very distinct entrepreneurial culture, which has allowed me to build a lot of experience in originating and executing deals around the world. I have always found working with emerging markets companies most rewarding, as there we could make a difference in helping them develop businesses and prepare for their inaugural transactions in international markets. I must have picked up the entrepreneurial bug working closely with fast growing businesses.
What inspired the creation of Shopitize? How did the idea come about?
The original idea for Shopitize was first mapped out on a napkin at a Belgian cafe in London in the summer of 2010. All of us (3 co-founders) were looking to start something new and were inspired by how today’s youngsters had made smartphones such an integral part of their lives.
We evaluated a lot of different concepts, but we kept coming back to a core idea that people should be rewarded differently based on their loyalty to specific products and brands. It was a couple of days later while shopping that we looked at a shopping receipt and thought: “That’s it- The receipt contained all the key information to make our system work.” And that was when Shopitize was born. We quickly realised our idea and business model could apply to all sectors, age groups and geographies and had real potential to cause significant market disruption.
Tell us more about Shopitize?
Shopitize’s mission is to create a world of savvy shoppers who effortlessly receive personalised recommendations and offers on products they regularly use and love.
Shopitize provides a platform to directly connect people with the brands they love and be rewarded for sharing information about how they spend.
The concept is based on four R’s - Receipts, Reports, Reminders, Rewards and is set to revolutionise shopping in the UK and world over. The more people join Shopitize, the more the system learns and the more sophisticated the rewards will become, saving both time and money for consumers and the brands. In short, Shopitize is set to change the nature of how people shop and how brand promotions are conducted.
So what were you doing before you founded Shopitize?
I was working on tech companies’ IPOs and M&A transactions when the tech market crashed in 2000, so I have experienced both boom and bust years.
What was your biggest challenge during the starting up phase?
I think one of the things you realise is that each phase has its own big challenges. Whether it’s the idea, the business model, funding, product creation or feedback, it’s juggling all the challenges that keep things interesting. The difference between running a company and working for a large corporate is that you feel each bump much stronger, and it is extremely hard to switch off.
Raising money is always such a hot topic when starting a business, How have you been able to fund the business?
Initially, we (3 co-founders) bootstrapped the company through the first stage while we refined the idea and business model. In August 2011, we closed our first round of funding of £1m from a group of sophisticated investors in Australia.
The responses to our vision and platform have been very positive. We are in the process now of raising our next investment round, so we spend a lot of time establishing relationships, pitching our vision and growing our consumer and brand base. This time we need a larger amount for the commercial roll-out, so fingers crossed!
What are the most crucial things you have done to grow your business?
I think that half of the success of a venture predicates on building a strong team and network. It has taken us a lot of time to find the right people, and we are lucky to have a very diverse and highly driven team and the advisory board, as well as what we call our ‘virtual team’ of partners who work with us on tech development and marketing. It includes Cogniance (outsourced development), JWT (strategic marketing), Refreshed Media (analytics and CRM), Whoosh PR, Mobikats (mobile app design) and Fennario (customer acquisition).
Would you say the business has changed from the first initial idea?
Our core vision has remained largely unchanged. What we have seen is that the adoption of smartphones has been even faster than we anticipated, which is great since we’re a mobile platform. Brands are also increasingly looking to mobile-based solutions to engage more closely with their customers. So the alignment of these two things has been great for us.
What would you say has been the highlight of your entrepreneurial journey so far?
The learning curve over the past 1.5 years has been the steepest that I have ever experienced. In my previous jobs I have advising companies on their strategies, and now I get the chance to roll up my sleeves and see the ideas through to completion. The feeling of seeing something that you and your partners have created is absolutely amazing!
What can we be expecting from Shopitize in 2012?
Since we released our mobile apps on iPhone and Android to public beta in March, we have received a lot of support and valuable feedback from users which has helped us refine our user experience. We’ll continue to do this year.
Once we finish our beta, personalised offers will be our key focus. We have also had great conversations with brands who are very interested in vision and who are excited about the potential we create to directly engage with their power users. So, building these partnership is one of the most important missions for us this year!
What three pieces of advice would you offer entrepreneurs starting out today?
The other piece of advice I would give is don’t be afraid of telling others about your idea. You need honest feedback, so keep asking for it. Make sure your elevator pitch is crisp; when we started, our early elevator pitch was only suitable for the tallest building in Dubai; we had to learn to focus.
Build your network early on. Use expertise of other people where necessary, rather than re-invent a bicycle every time. There’s no point innovating in the vacuum.
A lot of people dream of what it would be like running their business but never get around to doing it and regret it later in life. If this is something you would like to try, do it. It makes you much more alive and open to new experiences.