Over the past couple of months we have been moving deliberately to return Fab to its startup roots as we refine our strategy, build towards our 2014-2017 plan, and scale towards profitability. While many of our near-term decisions may not always make immediate sense externally, we are confident that we are making smart moves for the long term benefit of Fab customers and shareholders.
One important decision we made in this regard was to flatten our management structure. This decision resulted in the elimination of 8 executive positions. That was an incredibly difficult decision and one that we do not take lightly. The fact is that Fab had built a management infrastructure for a much larger company than we are today. As we return to our startup roots we need to be leaner and scrappier, with fewer levels and less hierarchy.
Fab’s amazing COO, Beth Ferreira and I decided together that it did not make sense for her to continue on in this next phase at Fab. This was an especially tough decision because Beth has been such an incredible close advisor to me and such an essential operator and leader at Fab. About 1/3 of Fab has reported to Beth over the past couple of years and she has been the driver behind Fab’s customer service excellence and our vast improvements in supply chain and logistics. When Beth joined Fab in the fall of 2011, our customer service team was inundated with complaints from customers, mostly about wanting to get their Fab packages faster. Beth fixed all this by hiring and leading a crack team of operational experts who took our average click-to-ship from 21 days down to 1 while turning Fab into an industry leader in e-commerce customer satisfaction.
Ultimately we decided, together, that thanks to Beth and the team she hired Fab now has the operational foundation in place and in 2014 requires a flatter organization, while Beth is ready for her next great adventure. In my mind she’s CEO-ready.
With all the hubbub about Fab the past few weeks it was difficult to get this message out and have it rise about the noise. I’m hoping it now gets its fair due. Beth is an incredible talent and Fab and I are forever grateful and indebted for her efforts in building lasting value at Fab.
Here also is a link to a fantastic interview with Beth by Forbes on the rise of female chief operating officers.
Thanks for an amazing run Beth.
I’m pleased to announce that Kiel Mead will join the Fab team on December 3. Kiel, a product designer and a co-founder of the American Design Club, will lead our initiatives to build an internal design lab and to support and grow the ecosystem of thousands of emerging and established designers working with Fab.
We’ve been fortunate to feature Kiel’s product designs on Fab since our founding and we’re even more fortunate that he has agreed to join us in-house for this next phase of Fab’s journey.
Kiel is a graduate of Pratt Institute and has run his own design studio since 2005. His product designs have been produced by Areaware, and have appeared in retail outlets including MoMA, Cooper Hewitt, Steven Alan, and Michelle Varian. Forbes named Kiel one of “30 Under 30” for Art & Design, and he is one of Prattfolio’s “40 Under 40”. Kiel is an adjunct professor for furniture as well as professional practices and ethics at NJIT, and has been a guest speaker at Parsons The New School for Design. He sits on the Education Committee at Museum of Arts and Design (MAD), and is a member of the steering committee for NYCxDesign.
Beyond the success of his own design work, Kiel’s crowning achievement to date may be the platforms he has created to highlight the creative output of other designers. In 2008, Kiel co-founded the American Design Club (AmDC) to encourage and promote the efforts of emerging designers working in the United States. AmDC has partnered with museums, retailers, and curators to create showcases for designers, their product, and the process of design creation. AmDC exhibitions and presentations have featuring the work of over 400 designers, from those just out of school to established household names. This past April, Fab partnered with AmDC to present the work of over 30 emerging American designers on an international stage at MOST in Milan.
Joining the Fab design team will allow Kiel to continue his work on a larger scale. We sought out Kiel specifically for his multifaceted background and deep connections in the design world. As a designer, a curator, a teacher, a retailer, and a connector, Kiel brings diverse experience and design perspective to Fab. His passion for finding and highlighting the work of emerging designers will be of unique value as we continue to grow our design department. We’re very pleased to have him on the Fab team as we build out the Fab design lab and continue on our mission to brighten people’s lives with design.
Analysts have been saying that this year will see weak holiday shopping.
Things are actually off to a solid start here at Fab.
I’m curious what other ecommerce companies are experiencing.
This last week at Fab we experienced four of our busiest days ever — and we saw Fab’s customers buying more items per order than they ever have before. It’s an overwhelming problem that we’re happy to have.
The reason? A few.
First, consumer lifestyle magazines stuffed with Holiday Gift Guides are in inboxes and mailboxes all over America and tens of thousands of people are already starting their holiday shopping on Fab. Fab gift ideas are featured in the December issues of InStyle, Redbook, Seventeen, Marie Claire, Latina, Real Simple, Ladies Home Journal and Design Bureau and more.
Here are some quick links to the products showcased in these pubs:
Gem Ring Magenta, fruitsuper design, $24
Shot Flask, Stone Cask, $22
Zub Zoo Edwin DeLaRosa Watch, NOOKA, $84
Storage Brick 8 Yellow, ROOM COPENHAGEN, $36
Composition Rainbow Box Set, Scout Books, $19
Wavy Stripes Pillow 16” Orange, Fab, $22
Mug Rainbow Set of 6, Lella & Massimo Vignelli, $60
E Napkin Set Of 4 Orange, Albers x Fab, $18
Brillo Box Pouf White, Quinze & Milan x Andy Warhol x Fab, $379
Deleware St Hoodie Gray Green, electricMVMT, $65
Ladies Home Journal
Intaglio IV Salad Service Set, Albers x Fab, $24
We also decided Black Friday sounded too ominous so last Friday we started our own color event: a promotion-packed Color Countdown, where every day featured new gift ideas at stellar prices. It was a HUGE hit, resulting in the four of the busiest days at Fab, ever.
We’re pleased as punch (yeah, I actually just wrote that) and we hope the recipients of your gifts from Fab will be as well.
Finally, if you haven’t yet started your Thanksgiving, Hanukkah, or Christmas shopping yet, not to worry. We still have tons of gift ideas for each occasion and every possible friend type and relation. And from now through the end of the year Fab will continue to pack our site with promotions, which will change daily. Check back each day for new arrivals and new opportunities to secure great gifts at great prices.
Here are some quick gift lists to help you get started:
- FAB’S TOP 100 GIFTS
- THANKSGIVING ENTERTAINING
- SECRET SANTA
- STOCKING STUFFERS
- HOLIDAY CARDS
SHOP YOUR LIST
- GIFTS FOR HER
- GIFTS FOR HIM
- GIFTS FOR MOM
- GIFTS FOR DAD
- GIFTS FOR KIDS
- GIFTS FOR PETS
- GIFTS FOR FOODIE
- GIFTS FOR DESIGN LOVERS
I’m really excited to announce the launch of the beautifully redesigned Fab site and app.
Some quick context.
We’ve spent the last couple of years interacting with millions of customers and we’ve gained a lot of valuable insights about mobile and online design shopping. At the same time, we’ve completed our transition from a flash sales site to the Everyday Design store. Fab now offers the greatest selection of in-stock and ready-to-ship Everyday Design finds available anywhere online or offline, at the best prices, backed by free shipping, free returns, and our 100% smile guarantee.
As the holiday season is starting, there is no time like the present for an easy-to-navigate one-stop-design-shop for the Everyday Design items that people want to live with, wear, and gift. Fab is launching thousands of new products in the coming days — fresh designs never seen before and not available anywhere else.
The highlights: An entirely new user experienced & huge strides in discovery-based personalization.
Our team is really proud of the design philosophy, shopping experience changes, and innovative technologies that are manifested in the new Fab site. Employing a flat design, the minimalist white visual framework with giant product imagery panes lends to a compelling and colorful focus on our amazing products (part of our continued effort to just get out of the way and let the products we sell tell their stories). The home-grown collaborative filtering and social filtering technology that is powering our new personalization experience is a level beyond anything we’ve seen in the market. These are just some of the aspects we’re most proud of.
A $10 credit on Fab (today only) - to try our new UX.
I get into a bit more detail about all the new site attributes below (with some genuine geeky stuff) but if you’re eager to just start shopping, please use this new Fab site launch link, which will get you (and anyone you share it with) a $10 credit on any purchase of $50 or more, good for today only, to buy something on Fab.
The cool geeky stuff behind Fab’s personalization.
While we’re proud of the new flat-design UX, the core feature of this redesign is Personalization. Several types of Personalization are woven throughout the entire new Fab shopping experience; our recommendations engine seamlessly bubbles up products that are highly relevant to each customer based on a recommendation engine that incorporates a variety of collaborative filtering and social filtering data points including: product pages you view; products you fave; products you share on Facebook, Twitter, and Pinterest; products you purchase; and then we overlay that with the same sort of activities for other people who we think are similar to you. Our personalization engine aggregates millions of data points across millions of customer interactions to help deliver a more relevant shopping experience. [For the true geeks still with us - the collaborative filtering technology we’re using leverages Apache Mahout which includes support for all sorts of fun stuff like collaborative filtering and user and item based recommenders. We’re working on singular value decomposition next.]
But wait, there’s mobile. Of course.
While the new Fab launches today on the web at Fab.com, the mobile version was submitted to the iTunes App Store yesterday and should be available to iOS and Android users in the coming days. Here’s a sneak peek:
On October 21, Fab will launch DesignTrek | South Africa, an exciting collection of new South African design, curated by our own Chief Design Officer Bradford Shellhammer. Here, he tells the story behind this initiative.
I’m so excited about today, tonight, and the story behind DesignTrek | South Africa!
Tonight, in collaboration with the South African government, Fab is co-hosting an event at the South African consulate in New York, debuting DesignTrek | South Africa, our collection of gorgeous, affordable, colorful, and unique South African design.
Fab is focused on being profitable and self-sustainable as soon as possible. That scenario is well within our reach with our existing financing if we follow an extremely thoughtful and disciplined path to profitability.
A constantly improving cost structure is critical to providing our customers with constantly improving benefits. Fab is investing tens of millions of dollars in developing and acquiring fresh merchandise for our customers at amazing prices, backed by our smile guarantee. To pay for that, while accelerating our path to profitability, we’ve made the tough but correct decision to eliminate positions that are either legacies of our former flash-sales business model or are part of current processes that can be managed with innovative technology and fewer people. The layoffs will affect almost every department at Fab but it is not an across-the-board cut, rather it reflects the strategic direction of our business.
In total the layoffs affect 101 people worldwide, including 84 people from our New York headquarters. Following these actions Fab will have 440 full time employees. As noted, not every group at Fab will be impacted. In particular, our Crackerjack customer service team, our merchandize planning, and our technology groups will remain fully in place. We are also hiring people for our private label sourcing team in New York and to grow our 50-person Fab Designed By You (Fab DBY) custom-furniture group that continues to operate out of our Berlin office.
I acknowledge that sometimes our near-term decisions may not always make immediate sense externally. This is not one of those times. The impetus behind this decision is our plan to accelerate Fab’s path to profitability. We are certain that driving towards a profitable Fab in the near-term is the way to build the best Fab for the long-term benefit of our customers.
Here is a link to a letter I recently wrote to our team at Fab. It is designed to educate everyone and anyone who reads it with a thorough understanding of how Fab is going to fulfill our long-term vision.
Doing the right thing for Fab encompasses doing the right thing for our people who will lose their jobs. Affected employees will receive severance packages that reflect the amount of time they’ve spent working at Fab. We are also enabling every laid-off employee to walk away with vested stock options. Our goal is to ensure that compassion infuses every interaction with those who will be leaving Fab.
This decision makes immediate and valuable sense for our customers and our business overall. We face the future of Fab with a justified optimism, confidence, and belief in the strength of our offering and our plan. Our enthusiasm for the future is infused with empathy, gratefulness, and support for those friends and colleagues who will be leaving us.
It’s not easy to say goodbye to a lot of people who helped create this amazing Fab journey. I know that a lot of tears were shed today. Our close Fab culture and the passion our team shares for brightening peoples’ lives with design makes moments like this even harder than they might be at most companies. To the Fab team from Bradford, our management team, our Board of Directors, and myself: Thank you from the bottom of our hearts for your tireless efforts at making people smile.
Since the very early days at Fab we’ve observed that Australians have a hunger for Everyday Design.
- Nearly 1% of Fab’s traffic comes from Australia, even though Australians could not purchase from Fab.
- 1 out of every 230 Australians in Fab’s core demographic of 21 to 45 year old adults are already registered members of Fab.com.
- In our recent survey to all of Fab’s members, more people requested that we extend our shipping to Australia than to any other new country.
Good news mates. Australians now have a new way to discover modern and colorful Everyday Design products at great prices, with free shipping, free returns, and backed by Fab’s 100% Smile Guarantee. Fab provides free shipping on all Australian orders over $75. Free no-hassle returns and Smiles Guaranteed apply to all orders.
With the addition of Australia, Fab now ships directly to 30 countries. Great design is everywhere – in every country, in every product category and at every price point – and it should be accessible to everyone.
We’re thrilled to open our doors to Australia today and we hope to invite many more people from additional countries around the world to brighten their lives with Fab’s Everyday Design products for the home, fashion, and gifting in the years to come.
Smile, it’s guaranteed.
For the last month or so, we’ve been asking our customers how they feel about Fab. The feedback we’ve received has been humbling, and has got me and others here thinking about how we can make Fab better, for everyone.
We came up with a simple promise: The Fab Smile Guarantee. If anything about your Fab experience doesn’t make you smile, let us know and we’ll do whatever we can to fix it.
Today, as part of our Smile Guarantee, we’re introducing free returns, free shipping (for orders over $49 and for all orders that take more than 5 days to ship — €49 in EU, £45 in UK) and price matching. That’s just the start. Our Smile Guarantee is our promise to you.
Your feedback helps us make Fab better. If you have any other ideas of how we can improve Fab, please email me personally at JG@fab.com to let me know.
Thank you for being part of Fab.
Smile, it’s guaranteed.
Fab is pleased to announce an additional $5M investment in its Series D financing round today. The latest investment comes from ITOCHU Corporation of Japan, following prior investment by ITOCHU Technology Ventures, the VC arm of ITOCHU, in the initial $150M Series D kick-off round announced on June 19th.
ITOCHU is a leading sogo shosha (general trading company), specializing in international and domestic trade including general products, logistics services, and more. With 150 years of history in the merchandise trading business, and the largest network of third-party logistics warehouses in Japan, the ITOCHU team will be a key strategic partner as Fab continues its mission in creating the world’s design store.
Shunsuke Noda, Chief Operating Officer of ICT, Insurance & Logistics Division in ITOCHU Corporation, said, “Fab is one of the fastest growing e-commerce companies and the leading online design retailer in the US and Europe. We believe Fab has a huge potential to expand their business in Japan/Asia and we are very excited to work with Fab to realize their long-term vision of being the world’s design store.”
Fab and ITOCHU will endeavor to develop a joint venture agreement that will mutually invest in bringing Fab to Japan in 2014.
The funding from a key Asian partner underscores global investor endorsement of Fab’s commitment to offering unique, curated design products to consumers worldwide.
As I noted in my blog post last week, layoffs are sad and painful. Unfortunately, they are also a natural course of business. Most companies, even the most successful ones, go through layoffs from time to time as part of strategic business shifts.
That still doesn’t make them any easier.
An advisor told me last week as we were making our strategic decision to to consolidate our operations at one global headquarters in New York: “Look, no company ever gets positive press about layoffs.” That’s true. At Fab, we have focused on our actions following our recent layoffs.
I’m currently at our Fab Berlin office, where our People Team here has taken an active role in helping our former Fab employees find their next great job. Yesterday we hosted a career fair at Fab’s Berlin offices where nearly 40 companies came to meet the former Fab team. We didn’t know that there would be press present (they weren’t invited), but we were heartened that they took note. You can read some local Berlin press reports about that here.
Our business decisions are driven by our commitment to our customers worldwide but we have zero intention of forgetting or not helping those who helped us get to where we are today. That includes our current and former employees in Berlin, a city of fantastic talent and companies.
If you or anyone you know would like to help or if you have any ideas on things we could or should be doing to go above any beyond to assist the former Fab employees, please drop me a line. @betashop or email@example.com.
Fab Announces $10M Investment From Singtel Innov8 As Continuation of Series D Round. @fab @singtelinnov8 @singtel
I’m pleased to share that as part of our ongoing Series D round of financing, SingTel Innov8, the corporate VC arm of the SingTel Group, Asia’s leading communications group, invested $10 million in Fab today. This is a particularly meaningful relationship for Fab as we are very pleased to have SingTel’s insight as we explore our expansion plans in the Asia region.
Fab is the place to discover the most exciting things in your life. Today, Fab sells in 29 countries across North American and Europe. We are developing plans to bring the Fab lifestyle to Asian markets.
SingTel has a lot in common with Fab – they serve a growing, young, and sophisticated population of consumers who are looking for lifestyle products to reflect their optimistic, dynamic and vibrant approach to life. That matches well with the predominantly 25-45-year-olds who come to Fab to browse and buy unique and compelling items they’ll live with in their homes, wear, and gift.
Jeff Karras, Managing Director of SingTel Innov8, said, “Fab has a unique and growing business, and is exactly the kind of company SingTel looks to partner with to best serve our customers in Asia. We are pleased to lend SingTel’s market knowledge and networks to facilitate seamless connections between infrastructure, technology and customer reach as Fab continues to build their global lifestyle brand.”
Since our last blog post announcing the initial round of Series D financing (which now brings our total fundraising to $320 million), Fab has made huge strides in executing against our priorities and vision. Most importantly, we announced the centralization of our operations at our New York headquarters, underscoring our shift from a flash sales model to more of a comprehensive global online lifestyle shop. We have momentum, we have growth, we have a solid team in place, and we have millions of customers worldwide that we want to continue to fall in love with Fab.
More Series D investors will be announced in the future, and we’ve decided to share that news as it occurs, rather than hold to announce all at once.
We believe that SingTel will be an integral part of creating a superior customer service experience in Asia and are pleased to welcome them as part of our Series D financing round.
They say it’s the tough decisions that make us stronger.
Today is a tough day for Fab and our amazingly talented and hard working team as we are putting into effect a considered initiative to centralize much of our operations at our New York headquarters. While the resultant efficiencies will add immense value to our growing global customer base, this change will also eliminate more than 100 positions in our Berlin office due to redundancies by the end of 2013. Fab remains 100% committed to the European market and the Fab Berlin office will continue to support our growing EU presence with a more tightly focused team in place. Fab’s European customers will not see any disruption in service. This is a strategic business decision, endorsed by our investors with whom we discussed this possibility, but that doesn’t obviate the sadness we feel in saying good-bye to the many people who helped put Fab on the amazing path we are on today.
Earlier this year Fab announced that we are pivoting our business model from our roots in flash sales to being a comprehensive online lifestyle shop. Over the past couple of years we realized that in order to exceed the expectations of our customers — including fast, free shipping and free returns on a great assortment of the most exciting lifestyle products in the world – that we would need to shift our business model to an inventory planning model. We are still working our way through that shift.
This evolution of our business model is key to our executing on our mission to be the place where people around the world discover the most exciting things in their lives. We are building a scalable model that allows us to sell the same products simultaneously everywhere around the globe while giving our customers complete confidence in their purchases. That was hard to do with flash sales as products would come and go from Fab daily; the nature of flash sales dictates that products are not kept in inventory and are thus very difficult to ship fast or for free. However, fast and free shipping is possible with an inventory-planning model. We’ve been working towards that, focusing on buying and making Fab products that are unique and special and that we can sell everywhere, again and again and again.
Last month we announced that Fab raised $150 million to fuel this next phase of our business.
With recent investments from Tencent of China and ITOCHU of Japan, and more Asian partners on the way, we’ve been evaluating the best way to bring Fab to consumers in Asia. All signs point to selling the same Fab products as we are selling in the U.S. and Europe.
Up until now Fab essentially ran two separate flash-sales businesses, one in the U.S. and another in Europe. There is a high percentage of supplier and SKU overlap between the two regions but the nature of flash sales coming and going daily required us to build up large teams in both locations doing much of the same thing.
To support this evolution of our business model, we are taking big steps today to also evolve our operating model. Fab will be consolidating much of our merchandising, marketing, and operations teams into a single global team in New York while, at the same time, planning on doubling our engineering team and hiring significantly in our sourcing and planning departments. More than 30 people in our Berlin office are being asked to move to New York. We will continue to maintain local customer service, returns, shipping and logistics, finance, IT and HR positions in Europe at our Berlin and Eindhoven offices. These changes will have zero impact on the Fab customer experience in Germany and the EU overall. Fab Designed By You, our custom furniture line, will also continue to operate out of our Berlin office. Fab will have more than 600 employees following today’s actions.
As noted in the beginning of this post, the evolution of our business model will result in the elimination of many positions from our Berlin office due to redundancy. The entire Fab team in Berlin has poured their heart and soul into this company and we are deeply grateful for their efforts. We promise to be gracious and empathetic to everyone at Fab involved in this transition.
Despite these changes Fab continues to grow. We are currently hiring for more than 70 positions globally.
We’ll have the opportunity in future posts to share the significant benefits to our customers of our decision to centralize operations at our NY headquarters and to talk about new investors. We’d like this post to remain focused on thanking the many people who contributed to creating the resonant, robust, beautiful Fab office in Berlin as it will continue to be crucial to our global success. We promise them that we will maintain the same vibrancy and commitment to the German, EU, and global market that they’ve established.
Starting today, Fab is no longer sending daily flash-sales emails.
Instead, we are introducing Following.
It’s really simple: Follow the stuff that excites you.
We’ll personalize your Fab experience on-site based on what you follow.
We’ll also only send you notifications when there are new arrivals of the stuff you follow, and you’re in complete control of how you hear from us.
We’ll start today by enabling Fab’s customers to follow departments (like Furniture). Shortly thereafter Fab customers will be able to follow designers and specific topics (like photography). Users will have full control over how they hear from Fab about the stuff they follow: Via emails and mobile push notifications.
These changes begin rolling out on Fab Europe at 8am CET and then in Fab North America at 8am ET. These changes plus many more new features hit the Fab mobile apps for iPhone, iPad, and Android soon.
Follow what you love.
Today Fab introduces @Fab Cribs, a series of videos shared across our Berlin and New York Fab teams. First up is The Fab Crackerjacks — our customer delight specialists. The Fab CJ’s are on the front lines daily helping Fab’s customers better their lives with design and solving any problems that arise along the way.
The NYC CJ’s say:
And the Berlin CJ’s say:
Smile, you’re designed to.