5 Major @Fab Announcements - April 30, 2013. A Long-Planned Pivot. New Products. A New Market. An Acquisition. And A Retail Channel.
Fab was first designed over a dinner in February 2011.
There, Bradford Shellhammer and I drank some wine and drew on a napkin and decided to throw out our year-old social network and restart as a new business focused on the one thing we’re both mutually passionate about: Design.
My passion is user experience design.
Bradford’s passion is to design the stuff people live with.
Nishith, Deepa, and Sunil — our co-founders in India whom I’ve now had the pleasure of working with and starting companies with for nearly 7 years — are passionate about designing scalable technology.
Collectively, our one thing is Design.
I’ve known Bradford now for 14 years. As the story goes, we randomly met in a nightclub in 1999. The story is true. We remained friends over the years. I was always inspired by him. Everyone I know has always wanted Bradford to help them design the stuff in their lives — their homes, their interiors, their accessories, their apparel, their art, their style. Bradford just has that unusual and uncanny knack for finding greatness and beauty in everyday things. He helps people embrace color. He’s fun.
I looked across the table at Bradford that night and I said: “Let’s design a beautiful website and app that brings your taste to the world.”
So we did.
People called it a “pivot.” We called it a complete restart. We threw out the old and started anew.
And it took off fast. Really fast. We re-launched Fab on June 9, 2011 and before we knew it we were tracking to $100M in sales and working with tens of thousands of designers and connecting with millions of consumers.
We were on to something big. We knew it.
So, in January 2012 we did what came naturally to us: We planned to Pivot. Again.
This time, we would do it gradually — over 16 months it turns out, and with 600 amazing teamates alongside us — but methodically, from our start as this interesting flash sales website for design to The World’s #1 Design Store.
We planned this pivot and mapped out how to do it over the course of these 16 months because we realized that we were on to something much bigger and more long-term sustainable than flash sales. You see, it turns out that Fab was always different from those other flash sale websites. We had created a marketplace for design, bringing together more then ten thousand designers who previously never had a rich platform on which to reach consumers. We were selling first-run merchandise at everyday good prices, not inventory liquidation at a discount. We had seen a groundswell around Fab on both the supplier and consumer side of Fab that is seldom seen around commerce. We were becoming a lifestyle brand. A horizontal play. We were more mobile, more social, and more addictive.
We planned to pivot towards creating one of the next great iconic shopping brands. (We hope). We told ourselves and our team: Think big. Plan to be big. Focus every day on what will wow our customers most in the long term. We’re in the wow business. If we make lots of wow, plenty of sales and revenue will happen over time. But first, focus on making wow.
Over the course of 2012 and into the first few months of 2013 we dramatically moved and transformed our business, while still growing sales by more than 500%.
We went from 2000 products on Fab to 15,000. Every day.
We took on inventory.
We built permanent collections.
We invested in search.
And Fab exclusive collaborations and design originals.
The result of which was profound. Before we even make today’s 5 big announcements, less than 40% of Fab’s revenue today is from flash sales. Most of our sales is from search and browse of products that live on Fab.
So today, we move forward. Towards a new Fab.
A new Fab that helps people find what they love, buy what they love, and love what they love, easier than every before.
This presentation and video spells out our evolution and strategic direction.
The announcements are:
- A major pivot, redesign, relaunch of Fab as the World’s #1 Design Store. The New Fab - redesigned from the ground up — is now live on Fab.com in the U.S. and it will be live in Europe as well in the coming weeks.
- The introduction of 3 types of Exclusively Fab products: Products Designed by Fab, Designer Collaborations, and Products Found by Fab.
- The launch of Fab in France, now giving us coverage into 99% of the European Union.
- The acquisition of MassivKonzept, the leading startup in online customized furniture, which is now being relaunched as Fab Designed By You.
- The launch of Fab’s first physical retail concept.
As always, we’re not done.
We’re always reinventing and reimagining what Fab can be. We won’t rest until we’ve created the global brand that is synonymous with design for years and years to come.
We want to extend a special thank you to the now 600+ amazing people who work each day tirelessly and passionately for Fab. You are incredible. You are making WOW every day.
Smile, you’re designed to.
Screenshots of the New Fab, The new Fab Retail Experience, and details around the Fab acquisition of MASSIVKONZEPT follow.
Additional details about our acquisition of MassivKonzept follow.
Beginning in the middle of 2012 Fab began exploring and putting resources towards ways for us to develop Fab-exclusive products, particularly in the home and furniture categories.
Furniture is a space we are particularly interested in disrupting over the next few years. Broken supply chains. The model of consumers going to physical retail showrooms and having to have a professional designer work with them to customize their furniture — in terms of size and material and color — is ripe for disruption.
So, about 6 months ago we started to think really hard about how to disrupt the market for custom furniture. We think this can be brought online efficiently over time.
We looked at a couple of companies innovating in the online custom furniture space and we were most impressed with MassivKonzept.
The MK team is super impressive. They’ve been at it for a couple of years now and have already bootstrapped themselves to a $10M revenue profitable business. They have built impressive technology and supplier relations with high quality craftspeople in Europe. They’ve created a seamless and fun way for people to go online, customize their ideal table, bookshelf, or sofa, and then have it hand-crafted to their specifications from high quality craftspeople in Europe.
The products they develop — that their customers customize — are of the highest quality, entirely user-customizable, and because of Internet efficiency, ship to customers at a fraction of prices similar products would sell in physical retail stores like Bo Concept, Crate and Barrel, and Habitat.
Today, Fab is announcing the acquisition of MassivKonzept in an all-stock transaction.
Massivkonzept by the numbers:
- 7000 customers
- $1000 average shopping cart, with largest customization orders reaching up to $100,000
- Over 10% sales are B2B: office owners, architects and carpenters buy from us
- 900,000 people have used the configuration tools online.
- 10% of sales in 2 years are from repeat buyers
We’re excited to now relaunch MassivKonzept as Fab, Designed By You, also known as Fab DBY.
Fab DBY will be available immediately to Fab’s customers in Europe. Fab DBY will be prominently featured on the Fab Europe website.
In addition, customers can access Fab DBY directly at dby.fab.com.
Fab’s U.S. customers will be able to purchase a collection of DBY best-sellers immediately on Fab.com. We’ll be working on integrating the full suite of Fab DBY customization tools into Fab.com in the future for both our U.S. and European customers.
As part of this acquisition Fab is also acquiring its first retail presence, as MassivKonzept has maintained a showroom in the Stilwerk design center in Hamburg. At that showroom potential customers are able to explore the MK range of products but all customization and purchases are still done entirely online. The slogan for MassivKonzept has always been “designed by you” and that will stay the same under Fab.
Today the MassivKonzept showroom is being transformed into a Fab showroom. There, people will be able to discover and explore Fab Designed By You as well as the broader range of Fab everyday design products.
Fab will be opening up additional retail showrooms in the near future. Our next target market for a Fab retail presence is in Berlin, near our European headquarters.
We believe that part of disrupting design is disrupting it across multiple channels. We’re working on Fab store concepts that reimagine and reinvent how people buy design products by merging offline & online experiences in entirely new ways. We’ve always said that Fab wants to be where its customers are — be it smartphone, tablets, web browsers, or even physical retail stores. And, with less than 5% of home products purchased online today, we think that physical retail has an important role to play in the customer’s decision process. But, we plan to reinvent retail and help guide home product purchased online to 10%, then 20%, then 30% online as part of our disrupting the industry.
The entire MassivKonzept team is joining Fab as part of the acquisition. The two founders of MassivKonzept, Christoph Jung and Daniel Kollman will lead Fab Designed By You. Chris will head up the producer side of the business while Daniel will lead sales and marketing and service. Both of them will report to Matt Baer, Fab’s Senior Vice President of Merchandising Operations.