Fashioning Success

It’s the eve of London Fashion Week 2010. Sarah Curran has a hectic schedule. She’s sitting on the panel at a Virgin Media entrepreneur event before racing off to the fashion week launch party. The fixture in the global catwalk calendar involves five days of “a lot of shows” and “lunches with designers and key press.” She’s then off to Milan for four days, back to London for one, followed by Paris for three.

“I love fashion: It’s inspiring,” Curran says. “It’s tiring, though, and it can feel like a bit of a treadmill. Having said that, I feel very, very lucky to be where I am today.”

Curran, 37, is chief executive of my-wardrobe, the “home of accessible designer fashion,” which she founded in April 2006 alongside husband Andrew Curran (chief operating officer, who’s due to stand down at the end of the year to pursue other interests). In November of last year the business moved into profitability and, in December, it started turning over more than £1 million a month in revenue.

Six months or so later, my-wardrobe raised $9 million in a Series A from Balderton Capital, one of Europe’s largest venture capital firms. That was the first institutional round raised by the e-tailer, which up until then had been funded by the Currans and wealthy individuals, including Nick Wheeler (founder of Charles Tyrwhitt, purveyor of smart shirts for city types) and Carol Duncumb (former CEO of lingerie business Intimas).

Balderton did not disclose the size of its stake in my-wardrobe, but Curran says she remains majority shareholder of the company. Under the deal, Balderton Partner Dharmash Mistry, former managing director of Emap Consumer Media, joined my-wardrobe’s board.

In Curran, Balderton saw fashion know-how, passion and an acquiring mind. “Three key factors convinced us to invest,” says Mistry. “Sarah has deep expertise and relationships in luxury fashion. She’s passionate and able to instil the same passion in others, as evidenced by the company’s 100% annual growth. And she’s open to learning, can process different views and will change track if it makes sense.”

Mistry adds that my-wardrobe fills a “huge gap” between Net-A-Porter.com, the online luxury fashion brand, and ASOS.com, its High Street fashion counterpart.

In Balderton, Curran saw more than just money. “It wasn’t just about cash, but finding a strong partner that would add value,” she says.

Today, more than 800,000 visitors flock to my-wardrobe every month, an increase of 110% over last year. The venture funding will help the company expand in an increasingly competitive environment, adding more brands and stock to its inventory, which already includes Mulberry, Vivienne Westwood Anglomania, Marc by Marc Jacobs and See by Chloé.

Three key factors convinced us to invest [in my-wardrobe.com]. Sarah has deep expertise and relationships in luxury fashion. She’s passionate and able to instil the same passion in others, as evidenced by the company’s 100% annual growth. And she’s open to learning, can process different views and will change track if it makes sense.”

Dharmash Mistry

“We’re No. 1 in our sector, and want it to stay that way,” says Curran. “I’m not interested in being No. 2 or 3. For me, it’s no longer about being compared to [Net-A-Porter.com] or ASOS.”

Despite her aversion to comparisons, there are similarities between Curran and Natalie Massenet, founder of Net-A-Porter. Massenet is a former fashion journalist, while Curran worked in fashion agencies, mainly in secretarial and administration roles, before becoming a sub-editor for Times Online. Massenet was pregnant when her site went live on 10 June, 2000; Curran took her first steps in the world of business on 1 Aug., 2003, and gave birth to her son, Jake, on 31 Aug. the same year.

Massenet netted around £50 million when she sold her stake in Net-A-Porter to Richemont, the Swiss luxury goods group, in April of this year. Curran hopes to follow in her footsteps, selling out around 2015.

The self-described “perfectionist” sat down with Venture Capital Journal to talk about where she got the fashion bug, her experiences raising VC, challenges she’s had to overcome, the merits of CEO coaching and lots more.

Q: Why the fashion business?

A: My mother’s French, so I grew up with fashion. Without knowing it, or being a slave to it, I always had a strong personal style. At school, I remember going into Oxfam and buying granddad-style jackets and raiding my dad’s wardrobe for jumpers.

He was a businessman. He set up an environmental services firm, which he sold 30 years later. Work wasn’t about turning up to a corporate blue chip at 9 a.m. It was 24/7.

Q: How did my-wardrobe come about?

A: In August 2003 I opened a bricks-and-mortar boutique, Powder, in Crouch End, north London. My husband Andrew [whom she met in 2000 and married in 2002] had his own serviced office business in London, but by 2005 we both felt we wanted to expand the fashion business.

My mother’s French, so I grew up with fashion. Without knowing it, or being a slave to it, I always had a strong personal style. At school, I remember going into Oxfam and buying granddad-style jackets and raiding my dad’s wardrobe for jumpers.”

Sarah Curran

There was real evidence that consumers had turned online. I was a Net-a-Porter shopper, but I was never a head-to-toe brand girl. I’d have a Mulberry bag in my wardrobe, but I’d mix it with more affordable pieces. At the top of the e-tail pyramid, there were premium brands and, at the bottom, fast-moving High Street fashion. I was more comfortable with the diffusion brands from mainline collections—what I call ‘affordable luxury.’

Q: How did you fund your company?

A: I borrowed some money from Lloyds under the Small Firms Loan Guarantee scheme for Powder, which was like pulling teeth.

My-wardrobe was funded privately. I inherited some money from the sale of my father’s business in 2005. Andrew sold his serviced office company the same year. And there were proceeds from Powder. Within six months, my-wardrobe was outperforming [Powder] in terms of sales. I could move faster online, so I sold [Powder] in 2007. We also sold our house. In total, we had start-up capital of £750,000.

Then, we had two rounds of investment targeting high-net worth individuals and angel investors. We used Matrix, which introduced us to IFAs. That’s how we got our network of shareholders. The first round closed in 2007 and the second in 2009. Collectively, they raised £4.25 million.

Q: What led you down the VC route?

A: We proved profitability. But as a fast-growing business it became a choice of growth or profitability. I feel now is the time to accelerate growth to retain our No. 1 position.

We used Ardent Advisors, the boutique finance house, to kick off the institutional raise. Some people just didn’t get it. They didn’t get the space—that you have to prove yourself to these [fashion] brands. We were really fortunate: We ended up with two offers on the table.

Q: Why Balderton?

When I thought of CEOs, I thought of men in suits with massive egos, and I was nothing like them. I didn’t have confidence in myself. I started taking CEO coaching in 2008. It’s like professional therapy.”

Sarah Curran

A: Balderton had experience within the e-commerce sector, with Yoox, Love Film, Betfair and Fig Leaves.

(Yoox, Italy’s leading online fashion retailer, completed an initial public offering on the Milan stock exchange late last year, and Fig Leaves, an online lingerie business, was sold to catalogue retailer N Brown in June, netting Balderton £10 million of the £11.5 million sale price.—Ed.)

Q: Will you need further funding?

A: No. We plan to grow internationally, but we don’t require additional investment for it. Just now, 85% of sales come from the U.K., 10% from mainland Europe and 5% from the rest of the world. We’re fiercely ambitious and are looking to expand in France and Germany.

Q: What’s been your biggest obstacle?

A: It’s been a massive learning curve. When I thought of CEOs, I thought of men in suits with massive egos, and I was nothing like them. I didn’t have confidence in myself. I started taking CEO coaching in 2008. It’s like professional therapy. I found it absolutely fascinating. I guess I’m still learning.

Q: What drives you?

A: From the very start I had a quality of life in my mind that I wanted for myself and I couldn’t rely on Andrew [her husband] or anyone else to achieve it for me. I’ve become increasingly ambitious. I wanted to create a global brand, but didn’t know what it would take. It’s probably just as well. There have been a lot of sacrifices along the way. I can’t just switch off. The last thing I do at night is look at the website and sales, and the first thing I do in the morning is pick up my Blackberry.

Q: Any top tips?

I hate the whole ‘female entrepreneur’ thing. Everyone struggles and everyone has to work hard. Sometimes, though, it’s slightly harder being a mother and an entrepreneur, because there’s a view that you might have your priorities skewed.”

Sarah Curran

A: Don’t be scared to recruit people who are better at certain things than you. I don’t have an answer for everything.

Q: How do you feel about being a female entrepreneur?

A: I hate the whole ‘female entrepreneur’ thing. Everyone struggles and everyone has to work hard. Sometimes, though, it’s slightly harder being a mother and an entrepreneur, because there’s a view that you might have your priorities skewed.

[My son] Jake’s very much grown up with it. He first came to [London] Fashion Week with me when he was 3-weeks old. I’ve learned to manage the guilt.

Q: What’s your greatest achievement to date?

A: I’m really proud of my team. They’re dedicated and passionate about the brand. We had 20 staff within 12 months and now have 90 split across the operational centre in Nottingham, where we have the warehouse and customer service team [in Curran’s father’s old business premises], and London, which is the creative hub, [where we have] buying, marketing and PR.

Q: Will you become a serial entrepreneur?

A: There have been massive highs and lows. I’ve loved every minute of it, but we put our financial stability on the line. I’m not the kind of person who thinks they have the Midas touch. I don’t know if I’d want to do it again. I’ll definitely stay in business, maybe encouraging younger entrepreneurs. Never say never, though.

BIO: Sarah Curran

The last thing I do at night is look at the website and sales, and the first thing I do in the morning is pick up my Blackberry.”

Sarah Curran

Chief Executive Officer

my-wardrobe.com

Age: 37

Education: tktktktk; tktktk

Work history: tktktktk; tktktktk; tktktktk; tktktktk

Last book read: “tktktk,” by tktktk

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Source: VCJ reporting