Britain’s new breed of e-commerce entrepreneurs

Cornerstone, Pact Coffee, The Chapar, Honest Brew and Bloom & Wild may not yet be familiar names to every household. Right now, this new generation of e-commerce companies are true challenger brands. They want to rewrite the way we shave, dress, drink coffee or beer, or send gifts. That puts them up against mighty competitors and entrenched behaviours.

But the force is with them. They are all attracting investors. With an intense focus on their particular product area, they combine innovation and attention to quality. And they are being led with fierce intensity.

Everybody wants to back them

This quintet of companies have all benefited from the recent wave of equity funding. In the first six months of 2015, Britain’s fast-growth e-commerce companies notched £232m of investment across 63 deals according to research house Beauhurst. That’s nearly double that of the first six months of 2014.

Cornerstone, which delivers high-quality razors and shaving supplies to its subscriber-members, had an initial seed round before raising £900,000 this summer from 229 investors via Crowdcube in just four weeks.

Kiwi engineer Andrew Reeve, whose Honest Brew claims to be the UK’s only personalised craft beer service, had a seed round in February and is now using Crowdcube for a second round of funding.

In July this year, after a seed deal in 2013 and a venture deal in 2014, Aron Gelbard inked a £2.5m venture deal with MMC Ventures and angel investors for Bloom & Wild, which aims to “redefine the flower gifting experience.”

Three year old Pact now employs more than 40 people. It boast a slew of investors including Robin Klein, Taavet Hinrikius of TransferWise, Rowan Gormley (founder of Naked Wines and now CEO of Majestic Wine), as well as MMC Ventures and Connect Ventures.

A July 2014 angel round saw The Chapar getting support from advertising grandee John Hegarty, Warren Johnson, CEO and founder of PR agency W, Heal’s CEO Will Hobhouse and FusePump co-founder Rob Durkin.

The search for a better way

They share a messianic belief in quality and innovation. “I started Cornerstone because I despised shaving,” says founder Oliver Bridge. “It’s uncomfortable, over-priced, and the shopping experience in Boots and Tesco is shocking. There had to be a better way.”

Pact is on a mission to to get everyone drinking better coffee. But Pact says it is about way more than just coffee; it aims to create a community from producers to the consumers. It is paying what it says are “significantly higher” prices which are based on cup quality rather than market fluctuations. It’s advising farmers on new processing on their farms.

The Chapar (the name comes from a courier in the Babylonian empire) provides an online personal shopping service for men. “We look after guys who don’t have time to shop, don’t enjoy it, or don’t know how to,” says founder Sam Middleton. A personal stylist learns your likes, dislikes, preferences and brands, and then makes a selection which is put together in a trunk. The trunk is delivered to your office or home; you have ten days to try them out and decide which, if any, of the items to keep. The stylist then picks up the trunk. Typically, says Middleton, customers keep 25 per cent of the items.

“I want people to discover and enjoy the craft beers that they love — at home,” says Andrew Reeve. “Craft beer is an amazing product; people want to drink it at home but nobody was making it that accessible.

For Aron Gelbard at Bloom and Wild, “sending and receiving flowers should always be a joy — but it’s still common behaviour to Google ‘flowers, delivery, destination’ and compare prices. And then do that the next time. That is crazy. Flowers are about love and should not be a commoditised Google purchase. Our ambition is to create a brand that people love, and for them to have the best buying and receiving experience.”

It’s complicated, being disruptive

What is also striking is the clarity and intensity of their approach. It’s complex being a disruptive e-commerce business.

Cornerstone is lean, lean, lean: there’s still just one customer services person for its 7,000 subscribers. “Being lean has allowed us to punch above our weight,” says founder Oliver Bridge. It’s the knowledge of the customer that will ensure Pact’s customers never run out of coffee. With thousands of customers discovering and refining their beer preferences, it takes a lot of back office logistics to create each individual Honest Brew box. At The Chapar, which does its own picking and packing, the team is sending out 100 trunks a day. For Bloom & Wild, it’s all about making it flower buying easy and quick. “People can buy our flowers on their mobile in under ten seconds,” says Gelbard; 50 per cent of orders now come through mobile and that will increase. His next step is to pilot an express service in London, which will enable flowers to be delivered in 90 minutes, using Shutl.

Britain’s e-commerce market is one of the most sophisticated and lively in the world. Online retail sales continue to grow. As retailers gear themselves for the possibility of £1bn in online sales on November 27 this year (Black Friday), these e-commerce buccaneers will certainly be up for the challenge.

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