Tuesday, October 31, 2006

The Zappos story

Hsieh talks about building a successful e-commerce site:
"After I sold my first company for $256 million, I began running an investment fund. I used to get a lot of calls from people who wanted me to invest in their companies. I almost deleted the call from Nick because I thought that selling shoes over the Internet was a bad idea.
"The one thing that intrigued me, and kept me from erasing the message, was the size of the market: $40 billion, 5 percent ($2 billion) of which was handled by mail order. By selling over the Internet, I thought we could do at least that much.
"I invested $500,000 in Nick's idea, which was originally called shoesite.com. Initially I was just an advisor, but it took only six months before I was working for the company full-time. I quickly learned that running a company is a lot more fun than just being an investor.
"At first, to get the word out about the site, we spent a ton on marketing and advertising. We bought a big and very expensive Zappos.com sign that was displayed in the outfield of the San Francisco Giants ballpark. It was a good way to get our name out there. It was an even better way to burn through money quickly.

1 comment:

oli said...

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