I'm Bertie Stephens, and I'm one of the founders of Flubit.com. At Flubit, we create lower prices than the best price you find online, so we've actually taken the e-commerce-- we call it e-commerce 3.0-- and we've actually taken it beyond price comparison, beyond searching. So it doesn't matter where you find that price or what product you want to buy. Just tell us what that is, and actually, we'll create you a lower price.
How does it work?
When you take it down to its absolute simplistic levels, it's actually quite simple. We're taking a philosophy of there's a great marketplace out there, loads of people selling things, and there's an open marketplace where people list products and all those sorts of things, and they list them on marketplaces where there's a lot of different set commission structures. And what we've done is we've almost reverse engineered that and we've said, OK, we'll keep this private marketplace that's just this one on one personal relationship. And when someone's found something they want to buy, we'll divert that sale across to another vendor and enable them to two win that sale which they were about to lose. So by doing that, we say, OK, let's change the price slightly, and Flubit creates a price that's really attractive to the new buyer. We're redefining the entire e-commerce scape. That's what our vision is, anyway.
There's a huge market out there. If you look at the buying circle, it goes awareness, where you work out there's a product. You might one day wake up and realize you need a brand new pair of headphones, so that's your awareness. And then you might start doing some searching, and you suddenly realize there's three or four types, and you narrow that down, and you look at reviews, and you look at considerations. You might ask some friends. That all comes in with awareness and consideration, and that's being really well catered for, and there's some really brilliant innovation going on in that right now. But what that's really doing is that's just tweaking the way people understand and look for products. And price comparison was a wonderful time that came along that allowed people to actually compare the products when they knew they wanted to buy.
What we decided was there must be an opportunity to actually go beyond that. So we actually concentrate on that final part of this wheel, which is actually the purchase stage. So when you're actually ready to buy, when you've done all that, people enter this stage of mentality which isn't social. They've talked to their friends. They've already done the reviews. And when they're at that point where they're ready to take out their credit card and make that purchase, it's all about them.
So what we said is, let's focus on that moment of psychology and really help people out. So we said, OK, if you've already found the product you want, we don't need to try and convince you about anything else, so we don't need to blast you with the reviews or comparison or anything like that. All we need to do is create these lower prices for you and actually increase the value of the thing you've already decided to buy.
So that's what e-commerce 3.0 is about. It's about at that final stage, let's increase the value for the consumer. And if we take it from big problems at the moment. I wake up every morning and delete three, or four, or five, six, seven emails from my phone or my desktop PC, which are all about saying, buy this, buy that, maybe get my teeth whitened or something like that. And a lot of what people are trying to do right now is actually say, this is what you want to buy, whereas what happens if you could actually increase the value when you actually know what you want to buy, and that's what we're concentrating on.
Let's go back to the mechanics of it. How do you manage to get your prices lower, ensure that consumers get lower prices than elsewhere?
One of the biggest things we do is we don't allow our prices to be public. So in the marketplace right now, there's huge amounts of competition out there, and there's competition because Website A will list their price, Website B will list their price. They'll then look at each other's prices and lower to the lowest, and there's this really big, above the line almost race to the bottom. But they're all at the same time, especially in the marketplace environment, which are the biggest leaders. You've got the [INAUDIBLE], and Amazon, and eBay, and those sorts of things. They all have to sell other people's goods, and that's where the biggest [INAUDIBLE]. And with that, they have to charge commission. That's how they make their money.
And we look at in a very similar way, but reversed. So we have to make money as well, so we have to charge commission. But how we look at it is, what happens if we don't actually have to set that commission? So we are still a marketplace that takes supplies through, but we take their prices with absolutely zero commission, and some even just give us cost prices. We take that absolute [INAUDIBLE] bottom price with a view that we will, when we've understood what price they were going to pay, add on our commission and add on extra bits for the merchant once we understand that. So sometimes, that can be 2%. Sometimes, that can be 10%, 15%, and we can be dynamic to really help make sure that we can increase the value for the buyer, but at the same time, still make sure it's great for the merchant.
I set myself up yesterday and I found it this incredibly simple interface for a user. Describe a little bit more about how that works from the user's point of view.
We had a decision when we were building the platform, how we were going to actually make this new way of buying work. We realized that we needed a benchmark, and that benchmark was going to be the price you could find elsewhere, so that was just the URL. That was the simplest way. And there's different ways of giving us that URL. It can be through copying and pasting the URL, or it can be using one of our integrated toolbars or bookmarklet, which we've released to some early users already.
So there's different ways of actually getting that out, but at the end of the day, we realized that there were just three things you just had to do. One was tell us what they wanted to buy. The next was receive an offer that's a lower price and same great service. And thirdly, once they've bought it, just keep track of their orders.
So we built an interface that only has those three options, and we took everything else out. We don't need to, as a platform, push things. You don't land on our site and receive an advert for a power drill because we don't think you want to buy that power drill. You're going to tell us what you want to buy.
And is there any commercial benefit in having lots of user data?
Absolutely. I mean, the commercial benefit is not so much what we can do with individual data, but we can do, I guess, in the form of looking at this concept of big data. So we can understand what people are buying. So if we compare our data with the surveys that came out and the research that came out for the Christmas market, we understand and we match up exactly with what were the most popular websites, what were the average basket values, because people are submitting all these URLs from different places.
So that makes it really quite exciting because what we have is actually an instant live feed of what the market is doing and how the market is progressing, which new players are coming through and people are buying from or looking to buy from. So with that, we can actually use that from a commercial aspect in giving an aggregated understanding of this data back to our merchants saying, look, if you sell Lego, why don't you look at these types of Lego because this type of Lego is selling really well and you don't stock it. So we can do that, and we can say, OK, you target 20 to 30-year-olds, maybe you want to look at this kind of structured vertical. So we use it in a very generalized, aggregated form because it's a great snapshot of the market.
How many users do you have now?
Off the top of my head, I don't know. The biggest thing we look at is our funnel, and the funnel's the most exciting thing. We have a 30% conversion rate, which if you take e-commerce, it's around 3% to 5%. And I do know-- I think we've processed around 4 million pounds worth of demands to date, so it's quite exciting the way we're growing at the moment.
OK, well you're obviously scaling up quite rapidly, a staff over 35. What's the plan for the coming 12 months and beyond?
Christmas 2013, although it seems quite a long way away at the moment, that's our key market time. Christmas is wonderful for e-commerce because everyone's out there buying, and we want to make sure that we can continue offering incredible value for these guys. So we want to get out there and say, look, it doesn't matter where you're about to buy this Christmas your presents.
If you wanted to save-- if you imagine, we give an average offer saving of around 10%. It does differ depending on the value of the product, but it's around 10%. So if you imagine if you're going to buy 500 pounds worth of goods this Christmas, you can save 50 pounds. And it's not saving 50 pounds by getting cash back later or anything like that. It's actually you're not going to spend that 50 pounds.
What about your investment? You've secured, obviously, you've got seed funding. What's the investment picture looking like for you?
Yes, so we've secured seed funding so far, which has been really great, and that's allowed us to grow to a team that's quite big. And actually, more than anything, it's allowed us to grow to a team which are really good. We have the resources now to bring on some of the top guys, and that's really exciting for us as a company to see that we can actually work with these great guys.
Going forward, though, it's about securing more investment to expand, to make sure we can approach nearly every retailer or e-tailer and go, look, we can sell your stuff. We're this alternative channel which can really push your items out there. I shouldn't say push your items out there because that's not what we do, but sell your items out there. That's what I mean, put them into the open market, or closed market, as we do.
That's the next bit of our investment, raising money to really expand our proposition more to a business side. The users, we don't feel we'll have an issue getting. We offer this proposition, which is we're always going to get you something for cheaper. And I think on average, people come back and buy 1.5 times a week. So it's actually quite a strong, it's quite an addictive platform because we just offer this extended value to people.
Yeah. And obviously, you have just picked up an award at the London Web Summit. What did that mean to you and the company?
We were really lucky, or really excited, I guess I should say, to win the London Web Summit. We've been following that web summit for some time, as a lot of the industry do, and for us, there's two aspects you can look at it. One is in the real world, where you've got customers and merchants coming on board and growing in that way.
But there's also really important, which is within your own industry and sector, and to win the award and have on the judging panel some of the top VCs meant that there was some real nice validation. And more than anything, it meant for the team, what you've been pouring hours and hours into for the last six, 12, 18-- whatever it's been, for however long it's been, within your industry, it's been recognized. And now we need to take that recognition through and make it really work and continue to work in the real world.
All sounds rosy. What's the challenges? What's the biggest problem on your desk at the moment?
Look. I had a brilliant trip out to New York last week, and one of the biggest realizations was that the American startups go out there, and all I hear everywhere is positivity. And even if you try and press them harder, it's always positive. And I think one of the interesting things about the London tech scene is people do talk about some of the negative sides and some of the things.
We're a startup. We're not meant to get things right every time, and the whole point of a startup is not getting things right every time. We will put two or three new features on every month onto our website, or just little iterations, and one or two might not work. And that's the things we look at, is actually-- and we're more than open that we've made a lot of mistakes. We do, and that's the point of a startup, and that's the brilliant flexibility of being in a startup is we can make those mistakes.
We've got some great, some systems toppling over as we speak sort of things, which our developers are working hard to, and we're not afraid to admit that because we've got a great development team, and that we're pushing technology and doing things. We're taking a URL and turning it into an actual real life offer you can buy, and that sort of in between technology hasn't been done before. So we make mistakes all the time, and it's great.
And if you talk about what's the biggest problem on my desk, it's just trying to smooth that line out all the time, just trying to smooth that line. I think we had a great situation yesterday where one of our connecting partners slightly tweaked how they send their orders, and suddenly, a load of our merchants couldn't receive their orders anymore. Massive panic, but we all settled down, and we get it fixed.
So that's something which is the day to day realization. I can speak of roses [INAUDIBLE] about how wonderful it is, and it is going brilliantly. We're really excited about it. But things break all the time, and we fix them, and that's the most exciting thing.
And then on the flip side, one of our biggest challenges over the next six months is let's get more merchants on board. We need to get out there. We're not as big as the other big marketplaces out there right now. We're only a small startup, and we need to convince them that we are the platform that they want to sell on. And some great numbers is good for us, but on the flip side, we need to say, you haven't seen us on TV, but people are buying from us, so that's the main thing.