All I knew is that it was a big market with an existing problem, and a similar idea was already working somewhere else. Sometimes
you just have to take a risk!
The most critical factor contributing to Gilt Groupe’s early success was the strength and varied expertise of its founding team.
Inspired by the popularity of New York’s designer “sample sales,” Alexis Maybank, Alexandra Wilson, Michael Bryzek, and Kevin Ryan wanted to use the Internet to bring Manhattan fashionistas’ favorite pastime to a nationwide audience. Together, they created Gilt Groupe, an invitation-only shopping website where members could get access to limited-time sales of coveted fashion brands at steep discounts.
The founders had varied yet complementary backgrounds and each of them contributed a vital component to the business. As the former chief executive of online advertising engine DoubleClick, Kevin brought the experience and perspective of having built an Internet business from its early days to a $1.1 billion acquisition. Alexandra had been in charge of retail operations at Bulgari and led leather goods planning for Louis Vuitton. Alexis was formerly general manager of AOL’s ecommerce businesses and had founded eBay Canada and launched eBay Motors. Michael Bryzek, a winner of MIT’s $50K competition, started an Internet payment company and served as the chief technology officer for a subsidiary of the United Way of America.
As an eBay alumna, Alexis understood how to create viral marketing concepts and give shoppers the rush that comes with purchasing in a competitive environment. The exclusivity and time-based nature of Gilt’s sales meant that items would never get stale, and the moment of purchase would carry a high degree of emotional satisfaction for the buyer, while giving merchandise companies an efficient way to sell their excess inventory without damaging their brands.
Alexandra’s contacts and reputation helped bring in nearly 400 prestigious brands, while her understanding of high fashion informed their decision to photograph items in great detail but with a glossy, editorial feel.
Alexis and I were both very familiar with the bricks-and-mortar sample sale business model in cities such as New York, London and Paris,” says Alexandra. “When shaping the idea for Gilt, we kept our closest friends—and ourselves—in mind as target consumers.”
“We knew that in order to build an exciting shopping experience we had to sell ‘lust, not must.’ We wanted it to be emotional so that when people saw an item they loved, they would be moved to buy it quickly,” says Alexis. “Our goal was to create the simplest, most streamlined online platform where we could offer the best assortment of merchandise.”
Michael took control of the online user experience and ensured that the backend technology was powerful enough to scale when the company’s user numbers began to accelerate. “We all felt that ecommerce was fundamentally changing and we wanted to drive it forward,” he says.
Kevin was the experienced operator. He led DoubleClick through its most accelerated growth period through the depths of the tech depression and back up again. DoubleClick was one of few first generation dot-com companies to not only survive the tech crash but to reach a billion-plus valuation. Now he could help the Gilt team stay focused on its goals, no matter the challenges around him.
And in August of that year Kevin started talking with friends at Matrix Partners. At the time, Gilt had no business plan or financial model. “If they had asked me, ‘What is the exact cost of a Valentino dress?’ or ‘How many of those dresses will you sell a year from now?’ I would have had no idea,” says Kevin. “All I knew is that it was a big market with an existing problem, and a similar idea was already working somewhere else. Sometimes you just have to take a risk!”
Matrix agreed and signed a term sheet with Gilt in October, 2007. The next month, the site went live, and Gilt started bringing in revenue the week it launched. The rest is history as Gilt rapidly surged to become one of the most successful ecommerce sites in the United States.
“Gilt provides the perfect case study for how a team and a business should function,” said Dana Stalder, Matrix general partner and Gilt board member. “The founders are keenly aware of each other’s strengths and weaknesses and are remarkably adept at making even the slightest corrections to stay ahead of the market. It is rare to find a group of people so in tune with the company’s customer base that also has the vision to add services and push ecommerce in new directions. Gilt continues to excite us on a daily basis.”
Founder & CEO
Gilt Groupe, Inc.
Gilt is an online shopping community that provides its members with access to coveted fashion and luxury lifestyle brands at sample sale prices.
TheLadders is the world’s largest online job marketplace catering only to $100k+ jobs.
Matrix Partners Board Members