3 examples of companies that have disrupted the traditional model and generated tens of millions

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Do you want to hear inspiring stories where you go “Wow, a small team has been able to do that”?

In this article, I’ll tell you about the advantages that small teams have on the big corporations, because yes, there are!

Most of you see just the disadvantage of not being a mega company of 500 employees as the lack of budget, the fact that a small team requires a pool of limited jurisdiction, the fact that the founder has more a role of a soldier, and not necessarily in general.

When you share a business, we often imagine that we are going to spend our days in an office of glass at the 58th floors with views of the river and that our definition of task is going to be limited to drinking scotch, bang on the table with his fist authoritatively and talk on the phone with Pierre Karl Péladeau, and Régis Labeaume.

The reality is quite different. It spends 1% of his time drinking scotch and 99% of the rest banging the head against the wall to ask for business as the “How it works the osti web site?” and “Why the world will not me liker on Facebook?”.

One spends his time to run, it doesn’t become cluttered bureaucracy, and we give everything we have until we do a burn-out. Worse that, it is an advantage…

An advantage because you don’t need your boss, of two committees and a vote of the board to act. To be small means that you are agile. It also means that you have nothing to lose and everything to gain. It means that you are hungry, and that thou art willing to take risks that the big companies are often too scared to take.

If it ain’t broke, don’t fix

And as they say, if it ain’t broke, don’t fix it! Then, the corporations stop innovating.

Each time a new technology comes out, it gives an unfair advantage, a new weapon that David can use against Goliath.

This technology may relate to marketing, such as the rise of podcasts, push notifications, sms marketing, advertising on Facebook, or virtual reality. But it can also include the means of production or distribution. We will see an example with a startup company that has found a way to disrupt the industry of mattress.

David can’t beat Goliath by pretending to be a colossus of 400lbs also. We need to be realistic. The big companies know what they are doing in their investments in newspapers, radio and television. It should not try to fight on these grounds.

Email marketing and social media are two new properties that the big companies are just beginning to master.

If you have doubts still email marketing, remember that it will have been the secret weapon of Barack Obama in 2008.

And for social media, just look at the campaign of Donald Trump this year.

The web is still in its infancy. This is the wild west and the gold rush starts all over again.

To support what I’ve just said, I’m going to show you three examples of companies that have undertaken, and it is little to say, because they have changed the traditional model, even if they fought against Goliath.

Three examples of companies that have generated millions in less than 3 years

1 – Leesa: mattresses

Leesa is an american company e-commerce luxury mattress. Its business model is based on selling B2C, that is to say, ship luxury mattress directly to consumers, without intermediaries.

The opportunity

The leaders saw many opportunities within the mattress industry traditional:

  1. Existing companies offered complicated combinations of foam, spring, etc, all to justify price increases.
  2. These latter had created a real gammick marketing which made the comparison of prices between the mattress similar to impossible for consumers.
  3. To test the mattresses, the consumer had to lie down awkwardly in the store, with a seller who was waiting anxiously for their opinion.

The founders of Leesa, therefore, are the parties of this these three opportunities to do this: a mattress of simple luxury that sells for half the price of the mattresses currently available on the market.

They have eliminated all the “bebelles” that the industry had added to justify the price increases.

How they did it?

They have created a mattress only made of foam, available in a cardboard box, a little bigger than a suitcase.

How is this possible? The mattress is rolled up in its box and out of it, he takes his expansion. Moreover, you will find on the web hundreds of videos of people who like to film their mattresses in the process of expansion.

In addition, they offer a 100 night trial or refund and return to you free of charge. We will tell, it is pretty illogical to judge the comfort of a mattress in 5 minutes in a store.

They attribute part of their success to the fact that they have used Shopify Plus, a solution for merchants with high volume. Instead of coughing up to create their own platform for online commerce and to organize themselves to repair the bugs, they have preferred to pay a fraction of the price to use the services of Shopify. This has allowed them “to focus on what they did best, marketing” (source).

The results

Leesa has launched on the market in 2013. During its first months, the company has generated 800 000$. In 2015, they have generated $ 30 million dollars (source). Still in 2015, they have done a fundraiser and have earned 9 million from private investors. Their valuation was $ 45 million that same year (source).

Is it that you realize that they started from scratch in 2013 and today they are worth more than $ 45 million? And the number of employees? 38. Yes, yes. 38 employees. You had read well.

2 – MVMT: watches

MVMT, pronounced Movement, is an american company that sells directly to the consumer, the watches (and now other accessories that have style and are affordable. The company was founded by two young people who have dropped the college from their company who has sold in 2016 for $ 50 million. Please read the following.

The opportunity

The traditional process of sale of the existing businesses had so many intermediaries that the prices were very high. In addition, during their debut in 2013, people shopped more and more online.

The two founders of MVMT were frustrated to see the existing companies sell their watches as expensive as they were not so expensive to produce. They wanted people to be able to afford a nice watch, while paying a fraction of the price of what was offered on the market.

How they did it?

First, they have eliminated the middleman by selling directly to consumers via the web. Then, they reduced the number of models offered. Then, they have allowed consumers to customize their own watches by choosing the colour of their bracelet and watch. As a bonus, they offer 2 years warranty on all their models and the international shipping and/or free return.

To finance their project, they have launched a campaign of socio-funding on Indiegogo in 2013. They had a goal of raising$ 15,000, and they eventually raised nearly$ 220,000! Through this campaign, MVMT has become the second largest fashion brand as the most-funded Indiegogo in 2013 (source).

The results

During their first year of operation, they generated $ 1 million in income. By 2015, this figure has exploded to 30 million of income (source). In 2016, they serve more than 50 million.

The number of employees now? 17 employees in June 2016.

3 – Frank and Oak: clothing

Frank and Oak, for those who do not know, is a montreal company selling a line of clothing for men (they now sell clothing for woman, accessories, body care, etc).

In three years, Frank & Oak has managed to turn the sales model for the traditional retail using technology to facilitate online shopping and mobile to a new generation of buyers.

The opportunity

On the one hand, men do not like shopping, on the other hand, guys were more demanding looking to create their own identity in a market where there was no brand for them. Another opportunity, the Internet gave them access to the world stage and the border between the physical and the digital faded more than ever.

They wanted to make it easy for men to shop for, in addition to providing more than a simple transaction. They wanted to build a unique experience. And to do this, they should know exactly who are their consumers.

How they did it?

To shop, users were obliged to open a session. Each time a user connects in order to make purchases, the company collects data incredibly relevant which allows them to know the preferences of their customers, the traditional retail does not.

Frank & Oak, then uses this information to make informed decisions, offer greater customization and customer loyalty.

The results

In 2014, the company had 7 employees. In 2015, that number climbed to 80 and today it employs 150 employees. It had in march 2016 14 shop physical, spread out in 9 cities (source).

The ranking Technology Fast 50 Deloitte ” reward canadian companies in the sector of information technologies with the strongest growth in their revenues over the past four years.” In 2015, the company’s montreal-based Frank & Oak has dominated the ranking with a revenue growth over four years of 18 480%! You don’t have the exact figures, but we’ll let you imagine…

Conclusion

Common to these three companies? They have a maximum of 3 years and they are worth all the millions. These companies were successful because they were able to be the David who attacked the Goliath to dominate. And they have attacked intelligently, on the grounds that the Goliath does not yet master. These companies have been able to change the business model and shaker the traditional industry. And they have done it with all small teams. It, it is impressive.

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