Alexandalexa: Alex and Alexa Theophanous
The company proving that designer clothes aren't just for grown-ups
Alex Theophanous didn't quite know what format his business would take, but he knew it was going to be big. “I knew it had to be online, because to build a really big business, you need a global market.”
In fact the whole Alexandalexa concept was formed around his desire to create a global player. The only thing he was certain about was that his new business had to be in fashion – that much was obvious, thanks to his wife and co-founder Alexa's fashion background. Women's online fashion was something of a saturated market as a result of the success of such sites as Net-a-Porter and my-wardrobe.com. Men's fashion, he knew, was tricky. But children's fashion was where the growth potential lay. “The total kids' market is £5bn,” he explains, “and 12% of that is online. The total women's market is £25bn and 18% of that is online. Three years ago, only 1% of the kids' market was online, compared to 12% of the women's market. So children's fashion is growing very quickly.”
In fact, it was the success of Net-a-Porter that really helped Theophanous hone his vision. Rather than go down the mass market route, he decided that his online proposition would sell beautiful – though pricey – designer kids' clothes and the website would reflect this in its tone. It's a website that appeals to grown-ups, he explains. Despite its offering there's nothing childish about it.
“If you look at the people who shop at Net-a-Porter, they're in their 30s and even if they haven't got kids themselves, kids will be in their lives. Our concept is to convert shoppers at Net-a-Porter to buy their kids' clothes at Alexandalexa.”
Before the site launched, Theophanous spent half a year refining the concept and, importantly, the brand, a process helped by a background in marketing. The importance of this probably can't be underestimated. His challenge was to persuade designers to allow their children's collections to be sold by Alexandalexa, and thanks to the strength of the pre-launch proposition, Ralph Lauren “agreed to take a risk”, says Theophanous. “That was the first online children's business they had ever sold to. These brands will not sell to more than four or five companies, so you have to get your foot in the door. Then, in terms of getting more designers on board, it was like a deck of cards.”
Theophanous' confidence in his start-up and the scale of his ambition didn't just impress the suppliers. Despite running out of money a year in to the new venture, he was quickly able to raise seed funding from investors who also helped him establish the infrastructure of the new business. Since then there have been two more funding rounds. The latest, with MMC, was recently finalised and worth £1.5m. More funding will be needed before long, according to Theophanous who says the latest round will “get them through this year”.
This is unsurprising as growth has been quick – with revenues doubling year and year and 50% of the business today being international. The opportunity now, as he had always planned, is overseas, with Theophanous pointing out that the US market is five times bigger than the UK. “Our core market is English speaking and travels a lot. So we need to exploit the English speaking opportunity.” New storefronts and translations will follow, and Theophanous is confident in his five-year projection of £50m.
Alexandalexa is based in huge, airy offices with plenty of space, signalling immediately the sense of certainty in its continued expansion. Not that there haven't been challenges. “The business has had to grow up,” says Theophanous. “Everybody's having to adapt and become more professional. My job is to still keep an element of fun, so people get up in the morning and think this is a great place to work.”