Subscription e-Commerce - Principia SGR
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Subscription e-Commerce - Principia SGR

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Subscription eCommerce, is the next big wave?...

Subscription eCommerce, is the next big wave?

About Principia SGR: Principia is the leading Italian Venture Capital firm that focuses on the ICT industry, has 90 millions(€) under management divided into two funds. In the last 8 months the new management company has invested in 8 companies with the second fund.

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    Subscription e-Commerce - Principia SGR Subscription e-Commerce - Principia SGR Presentation Transcript

    • e-Commerce B2C – the new trends Subscription commerce, is it the next big wave? Principia Open Office – March 2012
    • Principia SGR Principia is the leading Italian Venture Capital firm focusing on the ICT industry.. Principia has 90 millions(€) under management (part deriving from the government and part from privates) divided into two funds. The new management company has used the second fund to invest in 8 companies over the last 8 months. Team Michele Costabile (CEO), Research Assistant at Harvard University and Professor at Bocconi University Andrea Di Camillo (Managing Partner), experienced European VC (Kiwi I and CIR Ventures), co- founder of Banzai Group and Vitaminc, Advisor of Yoox and Venere Marco Magnocavallo (Venture Partner), serial enterpreneur (Blogo, Maki, Communicate! and Livesupport ) and angel investor (Webmynd, NextDigest, NoiseToys, Fubles, Pusher and Iubenda) Rita Polarolo (Fund Manager) experience in other Italian VC firms (TTVenture, Innogest) Massimiliano Cerilli (Fund Manager) experience in Private Equity at BNP Paribas Group. Matteo Panfilo (Investment Analyst), M.Sc on B&A and past experience on KPMG. Armando Golia (Investment Analyst), M.Sc on General Management and startup co-founder. Portfolio: Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • General overview US US - eCommerce Sales (€ Bln) 22,2% Growth Rate (’09 vs.’10) 9,23% CAGR (‘06-’10)Source: 1.Forrester 2. CB Insights data Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • General overview Italy Italy - eCommerce Sales (€ Bln) Purchase categories +17% ‘09-’10 news & music 3% +20% ’10-’11 apparel 10% other tourism 18% 49% insurance 9% grocery IT & 1% electronics 10%Source : 1.MIP, 2. Casaleggio associati, 3. MIP e Netcomm Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • General overview Italy, the opportunities USA EU Italia Apparel 20% 5% 0,8% News & music 39% 15% 6% Grocery 2% 1% 0,1% IT & electronic goods 42% 37% 5% Tourism 27% 25% 13% Italian excellence: Fashion Food Design Wine ArtSource : 1. MIP, Forrester Research & eMarketer Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • The new eCommerce trends o Mass customization (NikeID, Zazzle e CafèPress) o Collaborative consumption (Rent the Runway o Bag Borrow or Steal) Subscription e-commerce Monthly subscription for a selected kind of product which is then sent directly at home. The selection of products is based on extremely deep profiling of customers made by 10-15 initial questions and the selection of the curator. “ By 2015, 35% of Global 2000 companies with non-media digital products will generate incremental revenue of 5% to 10% through subscription-based services and revenue models.Copyright 2012 Principia SGR, All rights reserved Gartner ” Principia SGR Open Office - e-Commerce B2C, the new trend
    • Subscription eCommerce, key players At scale Male Female Beta or NewSource : seanpercival.com data Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • Subscription eCommerce, key players (Europe) Europe Male Female Rest of the world Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • Subscription eCommerce, key players (segments) Curated Male Female Standard Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • Subscription eCommerce, US investment trend $ Mln N. deals Relevant operations: Company Location Investors BeachMint Santa Monica, CA NEA, Trinity Ventures, Lightbank H. Bloom New York, NY Battery Ventures, Thomas Lehrman ShoeDazzle Santa Monica, CA LightSpeed, Polaris, Andreesen Horowitz BrichBox New York, NY Accel Partners, First Round CapitalSource : CB Insights Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • Example of Metrics (Fashion and Apparel) Unique visitors 20-28% Registered users Subscribers 2-3% 0.4%-0.85% CPC (€) 0,3 0,4 0,5 0,6 0,40% 75 100 125 150 0,55% 55 73 91 109 CR* % 0,70% 43 57 71 86 0,85% 35 47 59 71 * Conversion Rate form unique visitors to subscribers Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • The evolution.. StartupThreads (startup merchandising) EcoEmi (green multi-products) Ybuy (electronic goods with 30-day trial) Little Black Bag (black box with the possibility of exchanging the content with other users) Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • Main advantages Efficient net working capital management, reduced cash requirements for the short term. Greater subscription sales predictability. Recurring revenues. Efficient inventory management due to fast rotation and low stock level. Higher average Lifetime Value per customer, due to recurring purchases. Higher retention rates, are associated with the subscription mechanism. Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • Critical points Large capital requirements for acquiring customers and starting the business. More challenging customer engagement because of the increased financial commitment of subscription. Need for deep profiling of customers and tastes that are necessary for inventory management and logistics. Requirement for“Try&buy” that is difficult to manage in terms of stocking ” and logistics. High product specialization and curation for unique products not easily found in traditional e-commerce settings Principia SGR Open Office - e-Commerce B2C, the new trendCopyright 2012 Principia SGR, All rights reserved
    • THANK YOUwww.principiasgr.itinfo@principiasgr.it principiasgr Principia SGR