Spotlight on Opsh Founders The Mcginn Sisters
To date, this blog has focused on businesses that are still running, but today I'm telling the story of the McGinn sisters' journey, and their business Opsh which unfortunately recently closed due to failing to raise a further round of investment in early 2017.
The macro-environment threw up Brexit and investors got nervous, not something you can control or plan for. It happens, it happened to me during 9/11, I lost several investors lined up in my business, fortunately I was able to quickly access a smaller amount of cash which allowed my business to ride the storm, but that's not always possible. It's why I talk about the magic ingredient in business called luck. Had the girls raised earlier, they might be ok. Had Brexit not happened, they might be ok, but while you can plan for nearly every eventuality, the environment throwing you a curve ball is not necessarily one of them.
This journey is not uncommon, you don't always hear about it because in Britain we have a different attitude to failure than our US counterparts, where it is almost a badge of honour, to take your failure or mistakes and use them wisely, you need to have failed to succeed, here we tend not to talk about it. But a significant number of business fail, through mistakes of the founders or as in the case through something you can't control and their journeys, they are valuable. Just read the story below and you will learn so much about the ups and downs of running a business.
I'm going to say very little more, this is a painful journey and I will let Jennie McGinn tell it in her own words.
"So right now, I’m in a period of discovery and readjustment after we made the very difficult decision to wind down our company. I ran a fashion ecommerce business called Opsh with my four sisters and we had a team of 16 people.
Opsh was a Universal Shopping Cart for the High Street Online – allowing women to shop across their favourite High Street brands with one account and check-out. At its peak, we had raised almost 1m in investment, had 30 top-tier retail customers and endorsements across business, fashion and tech. But we needed a second round of investment and Brexit scared off all our potential investors in the critical time-frame we needed to close. Here was the very difficult “farewell” letter we wrote to our audience:" says Jennie.
1. What was the reason behind you starting your business?
Sheer frustration with shopping online. Ease and simplicity is promised; and in certain verticals (like travel, hotels and groceries) that promise has been delivered. But not in fashion. The fashion industry is notoriously slow to change; the High Street even more so, and the seemingly obvious ability to shop across different brands in one place does not exist. The closest offering – Asos – is a wholesale model, meaning it only works with a select number of retail parties and only offers a selection of a range. So for example – I want to buy a pair of River Island jeans, a Cos jumper, a Zara jacket, Kurt Geiger shoes, a Topshop handbag and undies from Marks & Spencer.
2. How did you start up?, kitchen table? Mum’s garage, renting premises?
Kitchen table all the way! Myself and two sisters set up shop in one sister’s tiny, cramped and very dark apartment, covering the walls in white-paper and brains-storming all Summer long with Diet Coke and Haribo sweets.
3. How did you fund your business?
We literally googled “money for business ideas”, came across a technology start-up accelerator called Launchpad in Dublin, made an application and somehow, after a disastrous pitch (our 3D model of “the internet” fell apart during the presentation), we got accepted. The deal was 20k seed funding and a 3-month rollercoaster ride to transform our idea into a Minimum Viable Product. We always say it was like doing an MBA on speed.
4. What was the most difficult part of starting up your business? Access to money, advice, finding people to buy, marketing etc?
Access to money was not our first challenge, although that is one of the biggest hurdles for most businesses – maintaining access to finance was what ultimately brought us down. But initially, the challenges were: being overwhelmed with conflicting advice (so much of it unsolicited), convincing traditional and corporate mindsets to take a chance on us, and dealing with unconscious sexism (family, female, fashion – we had a lot to contend with) But of course, at the start, you are ruthlessly optimistic, full of energy and passion, so you bulldoze through a lot of those hurdles.
5. What help was missing for you?
For us, I think we were unfortunately too ahead of our time – being first to market is almost as bad as being last to market! We were also trying to build a global business in a country that does not offer the kind of capital required to build a global business. Ireland just did not have the type of investment we needed; we turned to the UK and secured our first round, but then the UK became embroiled in Brexit confusion, which made a lot of investors across UK and Europe very nervous. Also, we wasted a lot of time having to endure “tire-kicking” meetings. For bored, corporate financiers, dealing with the same type of businesses, an opportunity to meet a colourful team, talking about fashion, was an opportunity to break up the boredom of the day. We learned that the hard way.
6. What went wrong in your first year? Few months if you haven’t been trading that long?
In the first year, we focused on slightly too niche a market. We probably made a few “people” and hiring mistakes. And we probably ran ourselves a little ragged listening to so many different points-of-view. But they were good mistakes and good lessons we learned from.
7. What have you learnt?
The unsexy bits:
- think about your financing strategy in earnest (even if you’re not a “finance” person) – honestly, that will take your passion and ideas so much further. Think about cash-flow, grants, investment, self-financing, the cost of doing business. It’ll be a pain, but you will ultimately reap the rewards.
- be very careful about hiring. Even when you are absolutely flat out and in desperate need of resource, hire in people as consultants first, or on short-term contracts in case they don’t work out
- ABN: always be networking, your pool can never be too large
- ABR: always be raising finance if you do intend to go 3rd-party. You can never start too early
- don’t let ANYONE tell you your business is too pink, too girly, too early, too late, too X, Y, Z. You will not please all of the people all of the time, so don’t bother trying to.
8. What is the most important piece of advice that you could give others thinking about starting a business?
All of the above, but also:
This is controversial, but surround yourself with Yes Men at the beginning, provocateurs in the middle and your staunchest supporters by the end (friend, family and mentors). You need the positivity to get started, you don’t need people telling you all the reasons not to! In the middle, you do need to be challenged, so you don’t make mistakes through your own bias and towards the end, it will be your friends family and mentors that have truly helped to get you where you are.
9. And what do you enjoy the most?
Looking back, I of course miss working with my sisters. Also – the start-up world is full of dynamism, positivity and can-do attitude; I think I’ll miss that returning to the corporate world!
10. On a scale of 1-10 how hard do you find it to run your own business?
A tricky one. A lifestyle business is designed to work around your lifestyle and should, after initial stress in set-up, should be stress-free. We were building a rapid-scale-global business and that stress is all-encompassing and of course, has a much larger impact on women and their personal lives.
I think, if you have an innate entrepreneurial gene, you can’t suppress it and with time and experience (and a few business endeavours under your belt), you learn to manage that stress. But you always have to work at maintaining the work/ life balance. It is a constant struggle.
Nicola Says " what an inspiring journey regardless of the outcome, this journey takes guts and a belief in what you are doing, to raise nearly a million in investment is a massive achievement. The inability to raise further investment is not uncommon as investors' appetite to risk changes when certain macro events happen, the dotcom bubble, 9/11, Brexit and it's so unfortunate to get caught up in one of those events; I've experienced this too. But you can learn so much from this journey and the girls will have too, so many transferable skills, once they lick their wounds and come up for air, they will go on to further success whatever they do."
Thanks for sharing a painful journey with me!
The Girl with The Green Sofa