Steal a business model and inject it with rocket fuel: the scale-up tactics of Rocket Internet

1. SCALING
STARTUPS
WITH
ROCKET INTERNET

2. AGENDA
1. About me
2. Rocket Internet: history, model & metrics
3. Why AARRR when you can BLITZ?
4. Bonus: Oliver Samwer’s personal productivity tips
5. Q&A

3. - Neuropsy/MBA
- Avid Reader
- Bouldering fan
- Ex-COO Westwing.nl
- Ex-VP oneUp.company
About me

4. - H&L Flash Sales
- 250mln in 5y, IPO in 2018
- 14 countries
- 800 new items/day
- 94% female customers
- 82% repeat orders
- Rocket Internet “Star”
Westwing

5. AGENDA
1. About me
2. Rocket Internet: history, model & metrics
3. Why AARRR when you can BLITZ?
4. Bonus: Oliver Samwer’s personal productivity tips
5. Q&A

6. Now it is time to either
decide we will die to win or to
give up
- Oliver Samwer, 2011
(1 of the Samwer Brüder, the founders of Rocket Internet)

7. What is Rocket Internet?

8. Rocket History
● 1999: Alando (sold to eBay for 43 mln USD)
● 2004: Jamba (sold to VeriSign for 223 mln EUR)
● 2007: StudiVZ (sold to Holtzbrinck, for 80 mln EUR)
● 2007: Founded Rocket Internet
● 2008: Founded Zalando (IPO: 11 bln market cap)
● 2008: Founded MyCityDeal (sold to Groupon)
● 2011: Founded HelloFresh (IPO: 2,7 bln market cap)
● 2014: Rocket IPO (market cap: 3,7 bln EUR)
● Current: over 100 companies in portfolio

9. Rocket Model
● Pick a proven business model (because finding Product/Market fit is for losers)
● Focus on:
○ Companies in verticals that are shifting online
○ Internet staples in underserved markets
● Execute:
○ Find 2 consultant or investment banking founders
○ Leverage Rocket-launchpad (funding, marketing, tech, logistics)
○ ?
○ Profit

10. Rocket Metrics
Rocket works extremely KPI-driven
● On funnel optimization
○ Which channel generates the best ROAS for market share growth?
○ Can we maintain our CAC versus our CLV?
■ Where are we bleeding conversion in the funnel?
■ Are cohorts improving over time (on conversion, basket size, repeat rate)?
● On Business Model optimization
○ Does our Contribution Margin cover our SG&A and Marketing?
■ From a clean P&L viewpoint
■ From an average order viewpoint

11. Funnels & Cohorts

12. Example P&L-based Metrics
A low PC1 indicates:
- High purchase prices
- Low selling prices
These costs scale with order
volume and heavily impact
(future) profitability
We can “outgrow” most fixed
costs and/or reduce marketing
spend. But watch your runway!
Don’t forget VAT (and returns)
A positive PC2 or Contribution
Margin means we are earning a
profit for every additional sale:
time to scale!

13. Example Order-based Metrics
Average Order Value (AOV) might
be replaced with Median Order
Value, for a more realistic view
These are all “per order” costs
and it makes sense to segment
them in greater detail
We can “outgrow” most fixed
costs, but they are still relevant

14. You must know your numbers! You can’t
not know. This conversation is useless. I
spend one minute with you and I feel like
I know more than you about your
numbers.
- Oliver Samwer, 2015

15. AGENDA
1. About me
2. Rocket Internet: history, model & metrics
3. Why AARRR when you can BLITZ?
4. Bonus: Oliver Samwer’s personal productivity tips
5. Q&A

16. Why AARRR when you can BLITZ?
VS

17. BLITZ-Model
● BORROW a working business model
● LAUNCH in as many countries as your runway affords
● IMPROVE your KPIs ruthlessly
● TERMINATE countries/business models that fail
● ZIGZAG to a new vertical and repeat

18. AGENDA
1. About me
2. Rocket Internet: history, model & metrics
3. Why AARRR when you can BLITZ?
4. Bonus: Oliver Samwer’s personal productivity tips
5. Q&A

19. BONUS

20. SAMWER PRODUCTIVITY TIPS
1. No e-mail between 8am and 8pm
2. Redefine illness: BYOB (bring your own bucket)
3. Want 3% more growth than competitors? Skip holidays
4. Be German detail oriented on KPIs
5. Publicly shame employees
6. Sign contracts with blood (to win the unicorn blitzkrieg)

21. there are only 3 areas in ecommerce to build
billion dollar business: amazon, zappos and
furniture.
the only thing is that the time for the blitzkrieg
must be chosen wisely, so each country tells me
with blood when it is time. i am ready – anytime!
- Oliver Samwer, 2011

22. THE END