When Sophie Cornish and Holly Tucker launched their marketplace website Notonthehighstreet.com they not only revolutionised the way we shop but also helped SMEs to thrive in a downturn. Here they reveal how vision and tenacity have led to the firm’s outstanding growth
Launching a business just two years before a severe recession began would put an end to many of the best–laid plans of entrepreneurs. But Holly Tucker and Sophie Cornish, the founders of Notonthehighstreet.com, are not just any entrepreneurs. Since launching in April 2006 the online marketplace has become one of the most high-profile e-commerce businesses in Britain, and enabled legions of SMEs to thrive.
Executive director Cornish says: “What we offer to customers is incredibly recession-friendly in the sense that you don’t have to spend a huge amount of money to give somebody a gift that really feels like it has value. That sense of attention to value is what we do.”
And what they do is in hot demand. In spite of the squeeze on household budgets, that attention to value and the appeal of an affordable, personalised, carefully chosen gift instead of, say, a pricey but soulless PS3 has captured the imagination of the buying public in their millions. Since its launch Notonthehighstreet.com has turned over £100m accumulatively and continues to grow annually in double figures. Tucker and Cornish have received a string of awards for entrepreneurship and customer service, and in 2011 the company was ranked eighth in Deloitte’s UK Technology Fast 50 and ninth overall in the Sunday Times Virgin Fast Track 100.
More than 27 million people visited their site in 2012, and one visit tells you why. Anyone with an itchy shopping trigger finger would be hard-pressed to quit the site without filling their virtual trolley from the huge range of homes and gift-able products available, mainly because such choice, quality and innovation is nowhere to be found in your nearest shopping mall.
Chief executive Tucker’s theory is that, although not everyone is born creative, 90 per cent aspire to be, but they just can’t quite get it right. “Maybe you’re not artistic yourself, but you can buy this most incredible print for your wall. You go to a dinner party and you don’t want to give chocolates, so you give a personalised wine crate. All these sort of things say something about you. We call it self-actualisation gift-giving.”
Quality control is high on the agenda for Tucker and Cornish, who over the years have turned away millions of pounds’ worth of business rather than sign up a product that doesn’t match their high standards, or a company that lacks the wherewithal to evolve. Says Cornish: “In our first year alone we turned away £1m of business from companies who were not in the 10 per cent we knew would succeed and deliver on the style and promise of the Notonthehighstreet.com brand.”
And a key reason for this ability to grow? Says Tucker: “We turn away 90 per cent of applications because we have to believe they’re workable. Once they’re on the site we know that they have to grow and deal with growth.”
In total, Notonthehighstreet.com brings together more than 3,000 independent small UK businesses that together sell over 70,000 products, and mentoring those businesses – or “partners” – is vital to their mutual success. “We’re owners, while they’re called partners, but we’re only as good as what they do, and we respect that.”
Unsurprisingly, the company has been credited as a force behind the success of legions of ‘mumpreneurs’ and kitchen-table start-ups to whom they offer not only a platform from which to sell and market their wares, but also the benefit of their experience and wisdom. The value of their mentoring cannot be underestimated. Indeed while charging partners 25 per cent of every sale and a £500 membership fee may seem steep, what those partners get in return is priceless, argues Tucker. “With us, they can sell at retail prices, they don’t have to have a shop, they can run things from their back bedroom, and it’s not like a wholesale arrangement, where up to 70 per cent is being taken. Included in the fee and the percentage we take is everything we provide – not just the platform, but the huge marketing budget, the make-do-and-meets, the account managers, the community, the bespoke site that you can now manage orders through – even your returns.”
And in order for the marketplace to work for all partners, Notonthehighstreet.com has to be huge. Says Cornish: “On a practical level, purely how the vision works, how our partners pay for the service, we knew the site had to be something to scale. It’s not something you could do for 20 small businesses and also be running your own business. It was about providing world-class marketing to lots and lots of small businesses.”
When Cornish and Tucker launched the company, marketplace sites didn’t really exist. “Back in 2006 there were just eBay and Amazon,” says Tucker. “Now people understand what a marketplace is.” And having led the way in forging this new path, the company founders are only too willing to share their knowledge to the benefit of their partners. “I still attend my top businesses’ meetings every year,” says Tucker. “We’ve gone above and beyond to support the companies so that they can also then deal with their growth. I think that’s a huge part of what we do – that we really seriously want them to do brilliantly well.”
With webinars, weekly newsletters, monthly learns and a forum where partners can give each other advice and support, they’ve created a nurturing environment in which partners have a real chance of thriving – at a time when so many others are failing. It has presented something of a lifeline to thousands of start-ups – SMEs with great products to sell that would otherwise have struggled to keep their heads above water – a fact of which Tucker and Cornish are immensely proud. Says Cornish: “We’ve been able to support small businesses at a time when who knew what was going to happen to them? We’ve picked up something that was terribly valuable and had huge potential at a time when the ground was falling away from their feet, to an extent.”
Tucker’s entrepreneurial spirit shone through from the age of 12 when she spotted a way to make that bit extra from her cleaning job at a pub. “I’d put on my Marigolds and scoop up the pocketfuls of change discarded in the urinals, clean them in bleach and take home an extra £2 each day,” she says. Starting her career in advertising aged 17 at Publicis, she was a girl in a hurry. “I was one of the youngest account managers in advertising and I got five years’ experience in hardcore advertising working for L’Oréal.” After a few years in sales she moved to a small bridal start-up, Coolwhite.com, and yearned to launch her own business. When she started making Christmas wreaths it soon dawned on Tucker that what she needed was a fair to sell them at in Chiswick, west London, where she lived. So she started her own. Soon Your Local Fair was launched, with Tucker running similar events all over the capital. And the 300 contacts she made proved invaluable when she hit on the idea of creating an online marketplace for high-quality products. “But I realised I couldn’t do it on my own.”
This is where Cornish, her former Publicis boss, came in. “Apart from my background in advertising, and brand development on campaigns for Boots No7 and 17 cosmetics, I’d also run my own business and worked on the editorial side at Cosmopolitan and Good Housekeeping, producing the beauty pages. I’d developed a real understanding of what customers want. After working for a couple of dotcom start-ups, I could see that everybody was thinking about money but not yet working out how to do it. I had a feeling that there must be a way that these people who are so ready to buy can do so, but with the curation and authority of editorial.”
After Notonthehighstreet.com’s launch in April 2006, the duo learnt the hard way what could happen if you don’t keep an eye on the bottom line, coming within weeks of losing everything. For in spite of great enthusiasm for the site and a promising start, they had run out of cash. While debts mounted they struggled to hold their business nerve and were forced into some critical disciplines. “We had to knock everything into shape, from our legal requirements to a monthly reporting system and the overall business model. It gave us, ultimately, a great grounding and added weight to the business,” says Cornish.
Luckily, they received a cash injection from Spark Ventures. In return, it gained a significant minority stake in the business and a place on the board. And things moved quickly. “That Christmas, suddenly our little bell that up until then would ring only once a day for a sale of £30 was now ringing every half an hour,” says Tucker. “Then the next year, we grew 800 per cent. We went from a £100,000 turnover to £900,000. The moment you start tasting that, it’s about ‘can you keep up with it?'”
Clearly they weren’t about to rest on their laurels. “We were like, yeah, £100,000 to £900,000, but why aren’t we doing £1m? We never smelled the roses, really,” laughs Tucker. In 2008, they went for another round of investment and the company has now undergone four funding rounds, the latest last year led by Fidelity Growth Partners supported by Index Ventures and Greylock Partners to the value of £10m. They now have over 70,000 products and more than 3,000 partners. With 100-plus employees now based at the company’s headquarters in south-west London and 40 small businesses applying each day to become part of Notonthehighstreet.com, by the end of last year they had accumulatively turned over £100m and will grow by more than 100 per cent this year
While each of the founders has a distinct role, their jobs overlap. “When we presented to people they wanted us to say, ‘this is my job and this is Holly’s job’, and it was never like that, and still isn’t in a way. We overlap,” says Cornish. And Tucker adds: “I’m there with the vision, drive and energy, and plans to scale it to a world-famous brand and change retail online, and Sophie’s very much on the brand side, the details, and the consumer side. I have a management team now – a COO, CFO and HRD – because we’re going to scale the organisation to, you know, the sky’s the limit.” Cornish concludes: “Holly brings the ‘what’s the plan?’ attitude. I’m more ‘this is what people care about, this is what the customer wants’. The two of us, with our strengths, come together.”
Recent developments include the introduction of multi-currency functionality on the site plus its first television advertising campaign. Not to mention a Sunday Times bestseller in the form of Build a Business from Your Kitchen Table, (Simon & Schuster, £14.99).
“We didn’t set out to break glass ceilings. We didn’t set up to become a female-led entrepreneurial business with five of the best VC backers in the world, supporting the UK and changing the economy. That wasn’t our mission,” says Tucker. “We don’t want to be famous – we’ve got a job to do. We didn’t realise the outcome of all that energy would be that we support 5,000 people now in the UK, not just through our business, but through the people our partners employ.”
And what’s next? International expansion is on the cards – it’s just a matter of when and where. Cornish says: “Bringing new products to customers who are looking for something special and more meaningful is universal. We’re tapping into universal wishes, desires and wants, so we’ve always felt that potential. We’re exploring all the options.” Only a fool would doubt the pair’s ability and vision to grow their company globally. “When we set out, we didn’t say, ‘oh, let’s get rich’ or any of that,” grins Cornish. “We were just totally excited and believed in this business. It’s like falling in love.”
By Marina Gask