SilkFred is an online e-commerce platform for independent fashion brands. It currently has 600 brands selling through the site.
Co-founder Emma Watkinson, 33, started out by writing a business plan in early 2011 while working for a now-defunct fashion e-tailer. She raised £150,000 in seed money from three investors in May that year and went on raise a further £145,000 through CrowdCube to invest in marketing and growing the business.
The business now occupies 17,000 feet of warehouse in London’s trendy Shoreditch area and employs 70 staff.
She talks to Growth Business about things to consider when bringing in outside investment, her definition of success, and how she’s always online shopping.
Where did the idea for your business come from?
Silkfred was started with a small investment from a group of friends with the aim of helping small independent brands to reach the customers who are looking for the latest styles. It started with a friend (now my co-founder) when we were talking about a fashion brand his friend had invested in. We discussed how entrepreneurs were having difficulties to get their products to market whilst creating sustainable businesses. We decided to go out and create the solution.
What experience do you have in your sector?
I started my career on the shop floor and I loved helping customers find outfits that made them stand out and feel special. I went from shop floor to buying and merchandising and then I co-founded SilkFred in 2011.
Do you consider your business to be a disruptor – what’s its USP?
We have created an ecosystem that allows independent fashion brands to reach an audience that loves what they create. We have an end to end solution for brands; spanning photography, marketing and logistics, meaning brands can go from idea to brand very quickly. We have also created a destination for customers to discover and shop designer styles without the designer price tag.
What part does technology play in the business?
A huge part! We are a fashion business powered by tech. Technology is what enables us to deliver a great experience for both brands and customers. Technology allows us to access data to learn more about our customers and improve our proposition, making their lives easier.
What funding did you have to start the business and where did it come from?
Once we had put our business plan together, we raised £150,000 from three angel investors to build our platform, get some brands onboard and test marketing. We’ve raised further investment since then, but the initial amount allowed us to prove our idea.
As the business has grown what are the major challenges you have faced, and have you overcome them?
There have been lots of challenges as we’ve grown. We’ve definitely faced a few scary situations. At first it was showing we were on to a great idea and getting the business funded, then it was scaling up our marketing, now it’s logistics. There will always be major challenges to face when you’re a young fast-growing company. We’re also in an industry that is changing so quickly.
Have you turned to external finance to grow? If so, what type – debt or equity?
What would you say to any other small business owner mulling whether to bring in outside investors?
Think about why you want investment – is it because you want to make the business as big as it can be and then sell it/ float it? Because investors usually expect an exit – it’s why they invested in you. Do you want to grow it sustainably and be profitable from the start? It will be a slower trajectory, but you will be in total control. There are many ways to run a business and one way isn’t necessarily better than the other, it comes down to what you want your business to be.
How do you measure success for yourself, your investors, you staff and your customers?
Success is showing that we are growing, we are learning, and we are improving over time. It’s showing how we overcome difficult and unpredictable situations. It’s staying competitive and moreover, how much we make our customers happy.
What business (or personal) tip would you give to other entrepreneurs hoping to scale up their businesses?
I would suggest getting as much advice as possible from those who have done it. They will have battle scars you can avoid. Lean into the challenge, stay humble as you grow and be kind to yourself.
Who has most influenced your working life?
A combination of mentors, my team, my best friends, my parents, my husband. It’s really about the network you surround yourself with. These people have been my biggest champions and critics at the same time.
How do you relax outside of work?
I like to read, drink a whisky (or two), hang out with my husband and twin baby girls. And shop online of course