How aggressive do you have to be in commerce?
23rd December 2 Comments
Yesterday, Techcrunch Europe published a confidential email written by Oliver Samwer to his Rocket Internet folks that bursts with business-related aggression, ordering the addressees to make plans for strongly pushing into the furniture market and sign those plans “with blood”. He names three areas in commerce where it’s still possible to build billion dollar companies – namely Amazon, Zappos and furniture – keeping in mind the principles of being “German detail oriented”, “fast”, “aggressive” and “data driven”.
Here is a short extract:
Never forget there are only 2 big areas in ecommerce: amazon and zappos. this is the last chance in your life! the chance for another billion dollar ecommerce company will never come again. This is over, after amazon there came only zappos, so we cannot lose this, because your grand children will ask why you why you did not become it.
Surprise me with your aggressiveness, but smart and thought through aggressiveness – learn from the russian and japanese mistakes and the german and brazilian successes !
This is our last chance in ecommerce to build an Amazon company. After us, you can build an online games company, but no more in ecommerce. this is the LAST frontier in your life for ecommerce and I want you to rule this frontier. not 20%, not 30%, but 80% marketshare which is still possible in your countries.
I am the most aggressive guy on internet on the planet. I will die to win and i expect the same from you!
After reading this, a number of thoughts came to mind that I’d like to post here.
Looking at the way in which the Samwer brothers have developed and advanced their businesses in the past it becomes quite clear that this couldn’t have been done by being Mr. Niceguy altogether. The “Jamba” ringtone business for instance still draws money out of teenagers’ pockets for digital mobile crap – and this was just the early days. After that, the three brothers moved to cloning business concepts that proved to be successful in the States, such as eBay and Groupon. With Zalando, they built a category-killer in the shoes and fashion segment (obviously based on the Zappos idea) and they are now planning to enter the international furniture market. To cut a long story short, the Samwers have a track record of collecting enough funding, whipping up clones in no time and exiting at amazingly high prices.
The downside of this is that they burn a lot of people in the process. We personally know programmers in Berlin working their arses off for Rocket or its subsidiaries and who are not being treated particularly nice. Also, two weeks ago, it was reported that Rocket Internet lost a number of key executives, further supporting the claim that working at such a high pace comes with a price.
I keep wondering whether the Samwer case is so unique. Having read the Jobs biography for instance made it very clear to me that Mr. Apple was not all fun and games when it came to developing products in time. Which style would Jeff Bezos use to bring his Amazon family up to speed? How does Zuckerberg approach his top-level engineers when he urgently needs new privacy features? How many people at Google have burnt the midnight oil because Larry Page needed his own social network?
Only three business areas?
Samwer points out that in his opinion there are only three really big business areas: Amazon, Zappos and furniture. Of course this can be argued and our mission @ecomPunk is to learn about companies who tap into highly rewarding industries in the future. What puzzles me is the fact that he talks about Amazon. Why Amazon? Amazon sells fucking everything there is to buy on this planet. What’s more, they are a successful IT company and excel at logistics. So if you want to build a company such as this, where would you start?
IT personnel as a bottleneck?
Somewhere in his monologue, Samwer urges his partners to look for top CTOs and build effective technical teams. He refers to Amazon as being an IT company and that IT is the bottleneck for many retail businesses. The more I learn about the current commerce scene, the more readily I would agree to the hypothesis that in order to build unique business models and move fast, you just need to have your own technical team onboard. Using standard software will only get you so far, and having to ask an agency every time a change needs to be made to one’s platform can drag on and on. Just look at how desperately companies all over the world are currently looking for PHP developers. Coders who know their way around Magento for example can choose between a great number of employers. Projects are delayed or stopped because there aren’t enough brainy IT people around (or because everything got screwed up by hastily getting outsourcing companies onboard). Whereas the frontend of web shops should be solely for users – the underlying structure is still pretty much a tech world.
So Samwer used a term from Germany’s 20th century dark ages to express urgency. Stupid, without question. Mike Butcher from Techcrunch expressed his countrymen’s eternal obsession with this subject by putting it in his headline and Samwer apologised. Please, let’s all be grown-ups again, shall we?
(Image by spirit-fire)