Fashioning a future in retail
With Wikifashion now a go-to resource for the global fashion industry, its Australian founders are off to a new cyber venture in start-up town. Sylvia Pennington reports.
Selling clothes and accessories online is hardly a novel concept but Brisbane "fashion technology" entrepreneur Madeline Veenstra is hoping her new business will tap a niche online retailers have overlooked.
The co-founder of Wikifashion, an online fashion news and images repository modelled on Wikipedia, is now in San Francisco, where Veenstra and her boyfriend and business partner, programmer Coen Hyde, have launched Popbasic.
The site sells "mini monthly collections", a bundle of clothes and accessories priced between $50 and $100 and delivered free. Customers sign up to an email alert and are sent details of the collections each month. It is almost a monthly subscription, but without the obligation to buy.
The debut collection - designed by Veenstra and sourced from China - comprised a spotted blouse, two costume jewellery necklaces and a surprise gift.
It was launched via social media in late January and sold more than 100 units, a break-even point for the venture, according to Veenstra.
About 3000 potential buyers subscribed to the alert in the first two weeks.
Popbasic aims to undercut chains such as Sportsgirl in the under-30s market, but Veenstra is also planning premium and men's micro-collections.
No strangers to the rag trade, Veenstra and Coen co-founded Wikifashion in 2009. It is updated regularly by a team of 6000 mostly unpaid contributors, and has 70,000 regular users, most of them based in the US.
After Wikifashion was listed for funding by the Australian Small Scale Offerings Board last year, the pair prepared to take their business to New York, the world's fashion capital. When funding wasn't forthcoming, the pair decided to retain Wikifashion as a community-driven resource and headed to the west coast instead.
Veenstra said San Francisco's budding fashion technology sector was a better fit for the self-funded new business than the Big Apple.
Cheaper shipping costs and the absence of GST made the US an attractive location for online retailers, she said.
The vibrant west coast start-up sector was a bonus, as was the presence of a slew of fashion and beauty vendors keen to align themselves with the latest online store, she added.
"There are a lot of fashion technology meet-ups . . . it could be run out of Australia but the time difference makes things difficult and there's no beauty and lifestyle brands to partner with in Australia."
Opengear chairman and angel investor Bob Waldie said Veenstra's reasoning was sound.
"Australia is not a great place from which to grow a global technology business - and if that business involves manufacture and distribution of physical goods, then Australia is not even a sensible place," Waldie said.
But Brisbane Angels Group chairman John Mactaggart said some entrepreneurs were too quick to pack their bags.
"There is the perception that things are easier in the US, so few people spend the time to analyse ways to exploit the advantages of their local community that will give them a point of difference from the competition," Mactaggart said.