Times are tough all over, especially for consumer-oriented websites. So I was little surprised and intrigued when I saw a release go out earlier this week for San Francisco-based Moxsie Inc., which operates an online marketplace for independent fashion, and is looking to reach out worldwide.
I wanted to see what makes an e-tailer tick in a recession, so I hooked up with Moxsie’s Catalina Girald, founder and creative director of the company who also goes by the title Fashionista-in-Chief.
Girald was born in Colombia and raised mostly in the United State and Europe. A consummate traveler and admirer of arts and design, she worked for a time as an attorney at Skadden Arps in Manhattan, N.Y. before attending Stanford University’s Graduate School of Business, where she earned an M.B.A in 2006.
Like any good Stanford student with Internet dreams, Girald began developing the Moxsie business plan. She then bootstrapped the operation until May 2008 when she raised about $1 million in early stage funding from Alloy Ventures and individual investors.
Girald talked with me about etailing, marketing and she shared her thoughts on the ubiquitous blue shirts and khaki pants that so many VCs on Sand Hill Road like to wear.
Q: Why’d you start a fashion site?
A: This is a question I can answer more in-depth in another interview, but I’ll say that I’ve always been obsessed with fashion and design, and through my travels, have amassed a collection of pieces that you can’t find locally and aren’t readily available online either.
I am also obsessed with technology and digital content. There is no way for online consumers to find cool new brands online using simple keyword search, so solving the problem of creating a direct connection between the designer and the end consumer so that a consumer can efficiently discover fashion online became my mission. I think we’ve made great headway in solving this problem, but it is all still hidden in our private beta.
Q: What have you found is the best way to promote your site to drive consumers to check out all those fashions?
A: Fashion is very viral. Plant the right seed and it will spread itself. We’ve been doing lots of blogosphere outreach, encouraging interviews with our designers, doing giveaways, letting the blogs themselves figure out what they like about Moxsie and broadcasting it. We’ve also been scouring the globe for some of the most interesting fashion pieces you’ll ever see and that gets attention.
Q: No TV ads? There’s no $3 million Super Bowl ad in your future?
A: TV advertising is not so cool in fashion, so we’re not too worried about the Super Bowl. Something we’ve learned is that converting people from one medium to another is a very indirect route. If you want someone to purchase something online, the fastest way is to go after them online.
Q: Couldn’t Moxsie work as a Facebook app?
A: With respect to apps and social networking, we definitely have this on our radar. There is a lot more coming down the pipeline.
Q: Would it give you a competitive advantage to be tied to a social networking site?
A: Right now, we don’t see a lot of competition for our niche. The majority of online fashion websites are focused solely on social fashion while Moxsie is more about experiential shopping, a combination of ecommerce and entertainment. While some may see Gilt Groupe as a competitor, they are more of a traditional retailer and they are focused on discounted apparel. Moxsie is neither.
Q: What is your outlook for etail?
A: Although we are experiencing an economic downturn and offline retail sales are slow, online apparel sales are growing. Online sales for January ’09 were higher than January ’08.
Q: Do people really want to buy clothes online?
A: The online apparel market–in particular, the online fashion market–continues to be a very interesting segment. Unlike sales of books, computers, electronics, or even shoes, online apparel sales are nowhere near hitting a plateau. It is one of the very last unconquered frontiers of ecommerce. Only now are large numbers of people beginning to feel comfortable buying fashion online.
Q: What about the suppliers? Do they really want to sell their high-fashion online?
A: We are seeing similar changes on the industry front. Before, fashion designers who snubbed online retailers over their bricks-and-mortar counterparts have completely changed their tune. Now the reaction at trade shows is: ‘Oh, you sell online? I love online! We’re really trying to build a presence there.’ And that is where the opportunity lies.
Q: Do you expect to raise additional funds to carry out your vision for growth?
Moxsie does expect to raise the next round in the second half of ’09. The funds will be used to expand the designers we carry, to strengthen operations, as well as to build a world-class customer service group.
Q: How is the recession affecting your fund-raising plans?
A: The downturn has affected a number of companies, as well as the valuations of the companies getting funded. We’re lucky to be backed by a fund with resources.
But we also see a real upside in this economy. Traditional retail is in a disruptive state, and this is when true opportunity arises.
Q: What are you doing to survive the downturn?
A: I have the benefit of having partners that have been in Silicon Valley for over 20 years. They survived this before and we are applying the same operating principles used then so as to survive it again. We have a fiscally conservative policy and have tightened the reins while continuing to expand.
Q: Specific to surviving the downturn, I want to know if the company is doing layoffs, or if you’re able to save money or costs through other means?
A: We have been measured in our hiring by making a few recent key hires, including a member of the founding team at Zappos.com. To save costs associated with hiring additional personnel we do what any reasonable startup needs to do. We continue to wear many hats and just work harder. We haven’t laid off any company employees.
Q: What do you normally wear at the office?
A: Ha! I wish I could say I always dressed like some sort of fashionista, very “Devil Wears Prada.” But I live in Silicon Valley. I actually dress like an engineer at work. OK, perhaps my jeans are a bit more fashionable, but I can be most often seen wearing jeans, T-shirts, a fleece and a pair of Rubber Ducks [the Ugg replacements that she says are selling out on Moxsie]. Also, flip-flops in the summer.
When I’m in New York, Paris, Hong Kong or Copenhagen–and even when I’m out at night in San Francisco–that completely changes and I transform into a fashionable person.
I fundamentally believe that fashion is a form of communication with those around you, so you have to dress how you want to be perceived. I started an Internet company that happens to be focused on fashion, not a fashion company that has a presence online and I want that message to be communicated to my engineers everyday. I want people to be focused on innovation and not on worrying whether they look good at work.
Q: Any thoughts on what other people should wear at work?
A: That depends on what message they want to convey? Does attire become more conservative in rough economic times? Absolutely not. In rough economic times we see the opposite effect. People seek to express their individuality and they seek to make themselves feel better or happier through clothes. Because funds are tight, people are more discerning and they are more inclined to buy the things they really fall in love with and skip the everyday basics.
Q: What do you think of the standard VC attire?
A: As for blue shirts and khakis, well, you are forgetting the fleece vest. I think I’d be a little weirded out if my VC showed up to work in skinny jeans. The Silicon Valley uniform is perfectly OK because again, fashion is all about the message you wish to convey to another.
I do think that for dates and social events the VCs could use a little help, and maybe Moxsie might have away of providing that. Stay tuned.