A chat with William Wolfram about his first ever business venture at the age of 15.
Kat: Hi, so I’m Kat and today I am here with William the Chairman and CEO of Galton Voysey. Today, I thought we could talk a bit about how you founded a few companies. One of the most successful companies you have founded is DealDash but you did it at 15. There’s some confusion online about how DealDash and Galton Voysey work together.
Well, what is DealDash first of all and how does DealDash and Galton Voysey work together?
William: Sure, so when I was 15 years old living in Finland with my parents I lost 50 euros bidding on a penny auction site. These are the type of auction sites where you have to pay each time you bid. I didn’t get MacBook I was trying to win and I didn’t get the 50 euros back. So, I came up with the idea that what if when you didn’t win a penny option you could just buy the product at the same price you could get in the store and get your bids refunded back to you for free.
So, I dropped out of school, to my parent’s great annoyance then we start building DealDash- and you know we bootstrapped the company and had a few other businesses before that, so I had enough savings that I could fund the company for the 1st year and 9 months. Over time, we grew to become the highest rated company in its category. We’ve grown to 18 million registered shoppers in America, 60 million of annual revenues profitable and then a few years ago I left DealDash and I co-founded Galton Voysey and started working at Galton Voysey.
Today, DealDash is run by a very capable independent management team and board. I’m not on the board and I’m not involved day-day, but we do a lot of business with DealDash. In fact, I think something like 10% of our business at Galton Voysey is DealDash buying products from Galton Voysey. The interesting combination there which has prompted some of the online confusion is that when Galton Voysey works with a brand and that brand does apparel products. That apparel brand does jeans and clothes say we want to try accessories like wallets and belts. Well, now you have to make like 1,000 wallets and 1,000 belts. What happens if consumers of that brand don’t want to buy those belts and wallets. This happens, every brand, all the time, no matter if you’re Louis Vuitton or Apple. You will never be able to predict how far you can extend a brand and what are the products you are going to sell and how many will you sell.
So, you end up with 500 wallets and what do you do? Traditionally, what you do is discount the wallets, you have some sort of sale on the wallets. When you’re discounting the wallets, you’re upsetting A) all the people that bought the wallet for the full price but you’re also destroying your brand equity. This is why, Burberry burnt almost 100 million dollars of inventory because they don’t want to discount. Most brands have to! What DealDash allows us to do, why they’re roughly 10% of our business is DealDash allows us, we can call DealDash up, you know one of our team members will call a buyer from DealDash and say we’ve got this brand, these wallets. They’re great products but we don’t want to discount them and we made too many. Would you take this over stock inventory and put it on auction and put it up for sale in a way where it doesn’t destroy the pricing power? They are all these other brands, DealDash works with 500 other brands, e.g. they sell Apple products and all sorts of other products. So, it’s very efficient means of moving inventory, that you otherwise or would be stuck with or end up discounting. That’s why we benefit, and so many other brands benefit from that model.
Seeing that I’ve co-founded both companies it’s always you know it’s important to be transparent about the relationship. We have a different board, a different set of investors, so obviously there are a lot of parties that are you know, looking into making sure that there’s a strong separation and that they act as independent companies. That’s what they have been doing since Day 1.
Kat: Great, thank you!