From local ecosystem builders to global collaborators - What started off as a curated fashion marketplace hosting over 500 Malaysian, Indonesian and Singaporean brands, shifted to blazing a new trail as Southeast Asia’s leading and fastest growing D2C Modest Fashion Group today.
In this episode of our Thought Inspire Series, in collaboration with CGS-CIMB, Fadza and Vivy talk to financial journalist Khoo Hsu Chuang about their entrepreneurial journey from bootstrapping in their early days to fundraising and scaling their business across the globe. Here you will find insights on how the couple uses their social media platforms to effectively market their brand, how they are able to convince investors to believe in their mission and expansion, and how they are able to maintain their creative advantage in the fast-paced fashion environment.
Describe your early days, how did you overcome the challenges of building a business from scratch?
Bootstrapping
“Those early days were the best because we didn’t know better. Naivety was a blessing as a young entrepreneur excited to create something out of nothing.” Vivy talks about the couple’s exciting beginnings at FashionValet. Vivy, a recent Law graduate from LSE in 2010 had grown her online presence through her blog, Proudduck during her days in university. On returning to Malaysia from her studies in the UK, Vivy and Fadza had set out to build FashionValet, an e-commerce platform inspired by the couple’s experience with online shopping during their time in London. Vivy explains that they wanted to implement what they had seen in the UK market in Malaysia and combine it with Vivy’s influence online to build-up a business from scratch. Vivy remembers telling Fadza “Why don’t we marry the two together? ” and in doing so led to the birth of FashionValet.
Fadza, a graduate of Aeronauteical Engineering from Imperial College London began his work with Vivy at FashionValet as a full-time employee at Deloitte. Fadza expresses the highs of building the business in its early days and the struggle of balancing his time with both Deloitte and FashionValet. He would spend the early hours and late nights working on the business because he was incredibly committed to the business as he saw the opportunity that laid at their feet. “I really believed FashionValet was going to work because it worked so well in the UK. Not to mention, Malaysia was so far behind in terms of adopting e-commerce that the opportunity was a no brainer.” Fadza explains.
Adopting E-commerce In Malaysia
Fadza explains how the couple believed they had a golden opportunity to capitalize on with FashionValet’s business model to curate a product line on their very own website through a consignment model in which FashionValet would host multiple brands on a one-stop-shop platform. “As a couple of 21 year olds starting a business, we thought we were going to be millionaires. The company was doing well above expectations and within the first 15 months we already hit a million ringgit in revenue.” Fadza explains how they had hit a goldmine with FashionValet. However, it wasn’t too long till the couple had to face rising competition in the marketplace especially with the likes of Rocket Internet beginning to invest into the Malaysian market.
Big Boys Entering The Market
Like most successful businesses, Fadza & Vivy began to face trouble as more businesses rose to compete in the online retail market in Malaysia. “When we started the business, we had the first-mover advantage but very quickly there were so many companies that started popping up trying to do the same thing we did, and they would poach… approach the brands we were working with.” Vivy continues to express how the wake of Rocket Internet in Southeast Asia began to make the couple feel unsettled as she says “The big boys are coming and it was scary. They were pouring millions into the market and we were still only spending 10, maybe 20,000 ringgit on marketing. We were taking it too easy on our social media platforms and realized we were taking our opportunity for granted.” This became the first turning point for Fadza & Vivy’s business to start thinking more long-term and strategically about their business goals which also became the couple’s motivator to begin fundraising in order to compete against Rocket Internet and maintain their position in the marketplace.
How would you advise entrepreneurs and young business owners to spend more wisely in Marketing/Advertising?
Think Grander, Act Granular
Fadza addresses this question by briefly explaining how marketing today is vastly different from marketing 10 years ago. Businesses today are not only competing against their competitors but are also fighting against all the noise of user generated content and paid content that are being pushed to consumers on platforms such as Instagram and YouTube etc. He continues by saying, “Being very targeted in your digital marketing such as picking the right customers is important but you must also ensure that it’s part of a much bigger marketing strategy because digital marketing alone is not good enough to grow your business to the size you’re expecting.”
Segment Your Audience
Vivy adds by explaining that one of the mistakes they made early on was making a one-size fits all marketing campaign such as designing a single banner and posting it across all their touchpoints. “I learnt through my digital marketing team that there should be different contents for different segments. These can be separated into customer acquisition efforts, promotions, ads for moms, ads for students, ads for conversions and ads for brand awareness.” In short, Vivy explains that you must break down your audience into its segments and market to them accordingly instead of assuming a one-size fits all marketing strategy will work.
In regards to developing an e-commerce business such as fulfilling orders and deliveries as well as designing a website. How did you go about building the backend operations of the business?
Outsource What You Don’t Know
When Fadza & Vivy began the business they admit that they didn’t have the slightest clue in building a website back in 2010. This was their first challenge to setting up their online business and decided to outsource this task to a company which they found from a quick Google search. Vivy expresses “Literally, I Googled how to set up a website and only one company came up called Net Builder. I told them I wanted to set up a website and they did everything for us.”
Build Up What You Do Know
Once they had successfully built up their website, Fadza & Vivy took it upon themselves to build their e-commerce business from the ground up from picking, packing and delivering as Fadza reveals, “everything was done on excel and in-house”. Fadza describes the difficulties of bootstrapping in the early days of FashionValet when they would receive an abnormal amount of orders due to launch days, “As we began we would average about 10 orders a day but on the days where we would have spikes and get 200 orders we would call for help from home and our friends. We like to reminisce about the days when we had 20 of our friends in the office on the floor packing till 3am.” In doing so, the couple was building and continues building their own systems in-house specific to their business needs in order to fulfill 10x the orders in a matter of hours as Fadza expresses “We’ve managed to build a lot of our own proprietary technology over the years because we were building it as we were scaling.”
As someone who built a business leveraging your presence on social media. What kind of advice would you give entrepreneurs who need social media to navigate between self and work?
The use of social media has sparked a trend in building a business in which brands are able to use founders to front the brand by demonstrating the values and qualities of a brand through the founder. Whereas, there still exist successful brands that do not use their founders to front the brand. Ultimately, Vivy’s advice to entrepreneurs is to do what suits them.
Benefits: Authenticity In Driving Growth
Authenticity is the number one key in growing an audience on social media especially if you’re using your social media channels to connect with your customers. “If you’re a small business, using a founder definitely creates a personality and adds more depth to a business which also adds a lot more emotion between the customer and the business.” Fadza explains.
Obstacles: Separating The Two Entities In Order To Scale The Business
One of the most difficult aspects of growing a business by fronting the founder is separating the two to allow the brand to stand on its own merits. Fadza expresses, “As you grow larger, you need to figure out how do you start phasing out the qualities the founder put into the brand for the brand itself to stand-alone, and to allow the founder to eventually step back. As much as the founder is the brand, you can’t replicate the founder.” He emphasizes that the separation of the two is key in expanding a business especially into many different countries, “A, the founder may not be as appealing in other countries. B, the founder can’t physically be in so many different places at the same time.” Fadza explains.
In your case, the lifeblood of the founder is invested in the brand but you’re looking to separate the two. How do you go about making that transition? And what are the things you’re doing now to make that happen?
Separating The Brand and Its Founder
Vivy explains that the first step in separating the two is to not instill the founders name into the brand’s name. “The simplest thing is that the brand’s name can’t be the founder's name.” says Vivy. She further elaborates the implications of using the founders name in the brand title, “When you’re starting out and your name is attached, you will have to be at every event and you have to be at every product launch.”
Brand Distinction
Vivy expresses that like any other successful branding strategy, a business must ensure that its branding strategy must be unique to create distinctiveness, from packaging to banners and social media postings to effectively target a niche market. This reinforces the strengths and values of a brand’s image which allows the founders to take a step back and allow the brand to stand through its own uniqueness. “I think every brand needs a niche, strong branding, and that X factor to stand out from the rest of the competition and apart from its founder.” Vivy explains.
How do you navigate between being a husband and wife, and running a business?
“When you're a startup everybody does everything and everybody will naturally fall into where they are strongest.” says Fadza. However, as the business began to scale from 10 million to 100 million, employing 10 people to 100 people, they had to take it upon themselves to delegate their responsibilities between each other - which led to their first cultural implementation to maintain the balance of running the business as husband and wife.
Husband & Wife Offsite
In addition to company offsites, the couple had implemented a specific offsite for themselves in order to realign their objectives and vision of the future which includes personal goals, family goals, business and professional goals. As the business began to scale, it was crucial to the couple to have an open discussion about each other’s strengths in the business as well as giving feedback for their performance in a private space where they wouldn’t taint each others images, as Fadza says “Those offsites can get pretty brutal and it's really important because we wouldn’t want to air out dirty laundry in front of other people.”
Establishing Rules & Parameters
During the couples offsite, they would establish ground rules for them to act effectively and swiftly for the business. One of the rules they had set in place were their key areas of responsibility in the business in order to allow each of them to oversee the operations and to be the key decision maker. Another detail they believe is important is delegating a veto to one person in order to break deadlocks.
Fadza’s Battle As CEO & Husband
Fadza admits that one of the most difficult things he has to face is Vivy’s larger than life presence on social media especially when Vivy or the business receives a lot of scrutiny from the public. This places Fadza in an incredibly difficult position to make the right decision for the business as well as making the right decision for his wife. “Both of us agreed that there must be processes in place where I wouldn’t be involved in the decision making and allow a third party to calmly assess and address the problem.” Fadza explains. This antidote would become the framework to help the parts of the business where the couple found it difficult to merge the elements of co-founders and husband/wife in order for decisions to be professionally done.
As a leading brand in the modest fashion industry, many of us would like to know about your creative process. How do you innovate to stay ahead of the curve? And how do you address this market?
Be A Spongebob ™
As a leader in fashion, Vivy recognizes that creativity is key in staying ahead of the curve in a competitive landscape as a brand's competitive advantage begins with the product. Therefore, as head of the creative team, Vivy encourages her team to constantly learn and read in order to innovate. “We have this really unique practice at FashionValet in what we call ‘Spongebob’. Spongebob is our learning session where the team gets together to watch movies and take offsite trips to factories in order to build up inspiration and creativity.” Vivy explains. She believes this kind of practice is necessary in a fast-paced industry like fashion to maintain momentum by encouraging her employees to continue learning in order to avoid burnout and creative blocks.
What In The World ™
Similarly, another practice that Vivy implements in FashionValet is what she calls ‘What in the world’ where each participant or teams would present what’s happening around the world such as new trends, fads, and innovations which gives each of the participants space to share what’s important to them. The aim of this practice is to achieve two outcomes, the first being strengthening the team through bonding and sharing their ideas in a welcomed space. Another is to wet the creative mind to ensure innovation is kept at peak performance. She further adds that this practice has helped tremendously in reducing burnout as Vivy explains “It really helps to see the world and see what everyone else is doing to inspire you again and again.”
Seeing that you’re both looking to expand into new countries. How do you convince investors that you can translate your success in Malaysia into new markets?
dUCk’s Opportunity In The Modest Fashion Industry
Fadza opens the answer by unfolding what he believes to be their competitive advantage as a business immensely focused on the modest fashion industry. First being that there is a largely untapped Muslim market around the world that is also becoming of the fastest growing markets today. He explains that In countries such as Malaysia, Indonesia, and the Middle East where it is vastly populated by a Muslim majority does not have a single large player addressing the modest fashion market. Although competitors such as Zara and H&M are beginning to address the modest fashion market, they are not able to cater to the wider Muslim audience because it is not their specialty which is where dUCk sees an opportunity to capitalize.
Secondly, Fadza explains that there is a massive opportunity in Western countries where there is a growing population of Muslim minorities that are quickly moving up the income ladder but are significantly underserved in those markets. “We’ve been able to build a great brand here in Malaysia and it is built upon the fact that our audience are proud hijabi’s and choose to dress modestly which demonstrates that there is an opportunity to turn what we have into a global brand.” Fadza explains.
The content of this article is summarized from our ‘Thought Inspire Series’, a series of six exclusive physical interviews with world-class & established company owners highlighting their entrepreneurship journey organized in collaboration with CGS-CIMB. The series is aimed to inspire, entertain and motivate all aspiring and existing entrepreneurs in the Malaysian entrepreneurial ecosystem. Follow us on our social media pages to get the latest news on upcoming events and key learnings.