Last year was a very good one for LOVESPACE, the “pick up and store by the box” company. They expanded to a team of 25, acquired a new 25,000 sq ft warehouse and moved into a new HQ in the City.
What’s more, they’re now well on their way to cornering the small business sector as well as the consumer market, storing clients’ goods before sending them on to customers or trade shows. Which means boxedup bathroom fittings, lingerie, theatrical props and baby products awaiting delivery now occupy their warehouses alongside the usual boxes of household paraphernalia.
That’s not to say that growing the business, in often unexpected directions, has been easy. “There have been plenty of times, with both businesses, when I’ve thought, ‘Is this going to work?’” admits founder Brett Akker. “There’s no straight path; there have been plenty of ups and downs along the way.” Who better, then, to share a few business insights with us, and point other startups on the way to success?
On catching the startup bug
“Once you’ve done something for yourself it’s really hard to go back to corporate life. It’s the challenge of building and growing a business, and creating a brand. Both Streetcar, which was a carsharing club, and LOVESPACE were fairly new concepts at the time. But there’s a lot that goes with that, like building a great team. At the end of Streetcar [before it was sold to Zipcar for £32 million in 2010] we had 250 employees, and creating that sort of level of employment is something that I’ve always taken pride in.”
“We’re hoping to expand hugely in 2016 and beyond. The fact that we’re based at Workspace, and have those links, really helps, because it means we’re very much part of a startup community.
On what it takes to be an entrepreneur
“My parents ran their own fashion business, so I got to see what working for yourself looked like, and in my spare time I did a bit of work for them. So I guess the initial seed [of entrepreneurialism] was sown when I was a kid. But more than that, I think you need to be a certain character, you need a certain bloodymindedness to get you up in the morning when you’re not sure there’s even going to be a business at the end of the day.”
“We’re hoping to expand hugely in 2016 and beyond. The fact that we’re based at Workspace [at Gray’s Inn Road], and have those links, really helps, because it means we’re very much part of a startup community. And startups tend to be our perfect customers – they’re people without massive offices, without huge storage solutions, and we really can help them maximise the space they’ve got.”
How to tell if an idea’s “the one”
“You might have a decent idea, but if you don’t do all the preliminary stuff before you launch, you could easily be set up to fail. There’s a lot of preparation you have to go through: you need to measure how big the market is, whether there is in fact a market there at all; you have to do some thorough planning, whether that be financial, marketing or operational. Having said that, for the go/no go decision, while you take all that into account, there’s an element of gut feeling. And I think I got to the point with both Streetcar and LOVESPACE where I felt the concept was very strong, the demand was there, and wouldn’t I be upset when I saw someone else doing it in a few years’ time when I could have done it myself?”
Right from the start of LOVESPACE, we knew we wanted social responsibility to play a part in the business.
Feel good about what you do
“Right from the start of LOVESPACE, we knew we wanted social responsibility to play a part in the business. But for earlystage businesses with limited funds, there are limited ways you can make a difference. It was Steve (Folwell, LOVESPACE’s MD who came up with the idea of an Oxfam offer: when customers place an order, they can also add a box for Oxfam, which we collect and deliver free of charge. It’s of huge benefit to our customers – residential or business – as it helps their CSR, and obviously there’s a big benefit to Oxfam. It’s now a core part of what we do; having that as part and parcel of our everyday business is something we really wanted to achieve, and something we’re all extremely proud of.”
On thinking outside the box(es)
“We certainly foresaw that small to mediumsized businesses would be customers of LOVESPACE. I guess what’s changed over the past year or so is our thinking around exactly what they would use us for. When we launched we presumed we’d be useful to companies looking to store their archives, and people certainly do use us for that. But a lot of businesses have started to use us as a key part of their operational function – their storage and their delivery out to their customers. So we’re very much managing the fulfilment/operational side of these companies, which we didn’t necessarily expect.”
Investment is changing
“It’s a very different landscape now, to when we started Streetcar. Then, we launched the business with savings, got an angel round of a couple of hundred thousand, and then the only other round we did was when Smedvig Capital came on board. Now, I’d say angel funding for that initial seed round is still pretty prevalent out there, but for that inbetween phase, between an angel round and a larger VC round, the fact that crowdfunding and other types of alternative finance have come along is hugely helpful.
You need to live and breathe your business.
We did a crowdfunding round with Crowdcube in the summer of 2014 of just over £1.5 million – it ended up being a mixture of angel investors, VCs and the crowd.”
Your business is your baby
“That’s how I thought of Streetcar, and now LOVESPACE – you really do care that much. You need to live and breathe your business. I invest in startups myself now, and when I go and see them, 99 per cent of any decision about getting involved is about the person or the people behind the business. Because you know that it’s never going to be a smooth ride with a startup, you’ve just got to make sure that you are totally in it for the long haul, whatever may happen, and whatever bumps you come across along the way.”
You’re only as strong as your team
“It’s vital to build a great team around you. A lot of people make the mistake, when they’re recruiting, of choosing people they don’t feel are quite as good as them – it’s less threatening. This isn’t something I’ve done at either Streetcar or LOVESPACE. Really try to surround yourself with people who you think are better than you at certain things; it’s very important.
“Starting something with a business partner can work phenomenally well, as long as you have complementary skill sets, like Steve and I. If you both have similar strengths and weaknesses, that’s where things can go wrong; you just find yourselves banging your heads against each other 24/7. Fortunately, I haven’t had that with Steve, and I never had it with Andy, my cofounder at Streetcar, either.”
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