LUX FIX: Alice Hastings-Bass and Rebecca Glenapp
Meet the clever young corporates who swapped the rat race for the catwalk
Founded: 2011 Founder: Alice Hastings-Bass and Rebecca Glenapp Turnover: Undisclosed
How do you go from investment banker to fashion entrepreneur? Alice Hastings-Bass saw the Net-A-Porter.com boxes stacked up in Goldman Sachs' post room and spotted an opportunity! Members-only fashion boutique LUX-FIX.com not only provides high-flying professionals with exclusive discounts on a selection of current-season fashion, but helps to drive shoppers to designers' online stores (something many struggle to achieve themselves, coming late to the ecommerce revolution.) With more than 60 British designers, including Pringle of Scotland, already on board and 5,000 users signing up in beta, LUX FIX is ready for blast off.
The market opportunity
According to the Bain Luxury Study, global online sales of luxury goods were worth $5.6bn in 2011 – and the jewellery and watch industry represented 22% of that market. With women responsible for 70% of the total beauty and apparel spend, there is a very obvious and targeted market for a new luxury fashion accessories retailer: especially one that can harness the popularity of pop-up shops and flash sales to offer exclusive discounts, as LUX FIX has.
With the 28-year-old founders' market research revealing that luxury accessories deliver a better return than ready-to-wear apparel, they are focused on attracting cash-rich/time-poor, 30 to 45-year-old women with a carefully-curated collection of designer accessories, cashmere and swimwear – investment pieces Hastings-Bass describes as “wardrobe additions rather than a whole new wardrobe”.
However, she and her business partner do have plans to branch into luxury homeware, leather goods and artists' prints, to expand their market share. With all that dropped into wealthy women's inboxes in a weekly newsletter, the co-founders are creating an irresistible proposition.
The real evidence of the market opportunity though, lies in the track record of LUX FIX's closest competitors. Net-A-Porter.com attracts more than three million unique visitors a month and has an average spend of £800, without even offering discounts on current-season stock. Fab.com, a US website focused on home design with a similar proposition to LUX FIX, attracted more than three million members within 12 months of launch.
LUX FIX was started with a combination of the founders' personal savings and seed funding from private investors – raising six figures in start-up capital. Growth capital has come from reinvesting all profits to date.
The business is fortunate to have two revenue streams to draw upon – both profits from the sale of luxury goods on its own site, and lead-generation deals with its designer affiliates, through which it refers customers back to the designer's website to shop their full collection. It also provides designers with specific insights into what kind of items, and colours, sell well.
The growth strategy
It is safe to say the founders have an ambitious expansion plan – but they are also entering a rare market which has actually grown throughout the recession. Aiming to increase their user base 10-fold by the year's end, the ladies expect more than five million subscribers and annual sales of £100m by the end of year five.
With the former head of digital marketing at B Sky B on board – and Glenapp's background in the same field, working with clients such as Facebook – they're starting from a strong position. With 35% of current subscribers coming from outside the US, LUX FIX is already shaping up to become a global business.
The founders plan to bolster this by adding some international designers to their collective, and may later segment the concept so fashion capitals have their own country-specific websites. With British Vogue's editor Alexandra Shulman already on board as a blogger, and a partnership with the British Fashion Council soon to be announced, LUX FIX has already won the hearts of the UK fashion industry. Next stop, world domination.
Luxury goods are a $5.6bn industry. With Net-A-Porter founder Natalie Massanett selling her business for £350m in 2010, it's time for a new kid on the block.