Made in Canada #6: SHOP.CA


A Canadian Online Retail Success Story Driven by Culture, Passion and Persistence

It can seem almost impossible to open a newspaper or visit a Canadian business news site these days without being bombarded with the pessimistic mantra that Canadian businesses (and entrepreneurs) are risk-averse, conservative and doomed to play second-fiddle to our southern neighbour in the innovation orchestra of the online world. 

Here at Dx3, however, we don’t buy into that kind of thinking. That’s why  our “Made in Canada” series regularly highlights Canadian startups that took a chance, dreamt big and are now stepping boldly into the global marketplace.

About SHOP.CA

When you walk into SHOP.CA‘s office in downtown Toronto for the first time, it’s nearly impossible not to get caught up in a sense of focused, determined and excited  purpose. Perhaps it’s because of the giant mission statement written in bold print across the wall, or maybe it is the brightly lit, open-concept rooms decorated with cheerful christmas lights and smiling people hard at work… but whatever it is, stepping into this office comes with the inescapable realization that you’re exploring that most electrifying of environments: a young, successful digital startup on the verge of something incredible.

Launched last spring, there’s a world of difference between SHOP.CA and any other eCommerce company we’ve featured on the Dx3 Digest to date. This is because it’s  part Canadian Amazon (but more), part eCommerce platform provider (but, again, more) and part digital marketplace (but, you guessed it, also more). With a core focus on becoming Canada’s first and foremost online shopping destination complete with millions of products, thousands of brands and retailers and loyalty rewards thrown in for good measure, it goes without saying that SHOP.CA is in a league of its own in the Canadian marketplace.

In order to learn more about how the site came to be (as well as how it came so far in just a few months since its launch), I sat down with its founder and CEO Drew Green to chart its story.

 

The Visionaries: CEO Drew Green and President Trevor Newell are the co-founders of SHOP.CA. Given the explosive growth and success of the site, they have a lot to smile about.

Origins:

For any Canadian consumer who has ever found themselves at the mercy of unexpected shipping and duty charges while shopping online, as well as the frustrating absence of reliable  Canadian alternatives to American sites, it’s not difficult to see the genius behind the idea of creating a comprehensive marketplace designed, built and run within our borders. According to Drew, it was these frustrations (and the inherent opportunity they implied) that proved to be the catalyst for SHOP.CA’s creation.

“Working in the US I would come home and talk to friends and family and our conversations always turned to digital media and eCommerce. When Trevor (SHOP.CA’s President and co-founder) and I first started going in 2009, there were massive challenges that existed for Canadian consumers in terms consistency and transparency over all. So really you can say that, for us, SHOP.CA started with seeing a really big challenge that existed not at a micro level but at a macro level.”

Fortunately, by this time time Drew had already spent the vast majority of his professional life immersed in digital media and eCommerce. “I’ve been either an entrepreneur, an investor or an advisor to startups in some capacity since day one,” he explained to me at the outset of our conversation, and looking back through his career its not hard to see what he means. From working as the Director of Sales at FloNetwork (before and after it was sold to Doubleclick [which was soon after sold to Google]), to being the SVP at Shop.com (no relation to SHOP.CA in organization or business model), Drew’s track record is a case study of experience in influential roles at a series of successful startups both large and small. In true entrepreneurial fashion,  he also owns and invests in a real estate company called Riverdale Rentals as well as a seed funding company called Dre Ventures. There’s a wealth of firsthand experience there you can’t put a price on.

This tempered familiarity with the startup landscape was instrumental in the consistent, but measured growth of SHOP.CA’s early days. “I see myself as an older entrepreneur at 38,” Drew explained to me, “but perhaps because of that we decided to take our time and methodically thought this out. We spent almost a year on our business plan and worked on our brand. Then, when we were ready, we said ‘OK’.” On April 6th, 2011 he officially quit his job and made SHOP.CA his full-time focus. “I think from a business perspective you have to look for inflection points…  a lot of great businesses and ideas start too early. But when you’ve done the legwork and you see the opportunity reaching the tipping point you have to be ready to go all-in. What we saw in 2010 and 2011 was the signal to move ahead.”

Challenges:

It’s never a simple prospect to start any company, but to aspire to being the definitive online retail site in the country is a whole other can of worms. That was the mission statement of SHOP.CA from day one rather than something that gradually evolved, and as a result the stakes were high from the start. As Drew put it, “The biggest challenge for us was the size of our idea. We didn’t set out to make a store and slowly grow. We had a mission to be the #1 shopping destination in Canada. That meant the need for great people, which wasn’t hard because Canada is full of them, but also the need for a fundamentally strong investment strategy.”

As readers of the Made in Canada series will know, however, raising large amounts of capital can be a significantly more difficult process for entrepreneurs looking to build something big in Canada.

“Raising the type of money we needed in Canada was challenging because our investment strategy was more like it would be if we were an American company. There is a much lower default level of funding available in Canada and our strategy was far more ambitious than a simple app or small-scale startup might require. But we stuck to that strategy and that helped us ultimately be successful. Fortunately we were really lucky that we built up a great group of investors.  They remain very engaged and that keeps us focused.”

In addition to securing funding, however, Drew and his early team had their work cut out for them in staying true to their vision in the face of doubting critics. “Our second biggest challenge was definitely to keep the doubters away. The noise was especially loud in the first six months, but even now there is hardly a day that goes by when someone from the outside doesn’t tell us that x part of the business can’t work. But instead of feeding into that we’ve focused on our actual challenges and on knowing what we can do because that kind of doubt is the exact opposite of entrepreneurship. Fear is a really bad thing for a startup so you have to make sure it doesn’t creep into your psyche or culture.”

Fortunately in SHOP.CA’s case, they were more than successful at overcoming the treacherous stages of bringing a big idea to life.

 On Being an Entrepreneur in Canada:

“I think Canada is becoming one of the best countries in the world to be an entrepreneur,” said Drew when our chat turned to the Canadian business community. “It’s just really important to think big because if you’re after a sizeable investment from your investors they’ll need to see a big opportunity. I don’t believe that means thinking outside the country. We knew from the beginning we wanted to build this here first and then go global, instead of starting somewhere else and adding in Canada as an afterthought.”

It’s a strategy that instantly called to mind the explosive success of Beyond the Rack, Well.ca and Shirtpunch: three other Canadian success stories that built their foothold on Canadian soil and who are now becoming major global powers in their own right.

Advice for Aspiring Entrepreneurs:

There are several dominant schools of thought when it comes to navigating the potentially hazardous waters of building a startup with a big idea, but in our conversation Drew was a keen advocate of walking a measured line between confident entrepreneurship and methodical business strategy. For although some entrepreneurs swear by the guts and glory path of leaping headlong into the fray and hoping that the funding will come later, and others advocate running lean in a self-funded, self-sufficient bootstrap operation, Drew’s advice fell in the Godilocks zone somewhere in-between.

“My advice would be to align your investment strategy with your business brand from day one,” he explained. “I don’t believe in just starting a business and then expecting that investment is going to happen. Instead you’ve got to build them together.  Some entrepreneurs will tell you that ‘you’ve just got to do it’, and that is true to some extent, but I’d say that you’ve got to make sure you have a great partner, a great business strategy and a great idea first. Don’t just jump blindly. Jump knowing where you want to land and you will get there.”

More than anything else, however, Drew’s most salient advice for future entrepreneurs came when we touched on the topic of overcoming doubt, looking forward and building something to be proud of.

“Be fearless. Be Persistent. Be relentless.” He explained when I asked him what is at the core of successful entrepreneurship. “Those are the three great words of being an entrepreneur  but they don’t mean that you should never be concerned or stressed out. They just mean that you should never focus on being afraid. You won’t have to if you’re really building something that you think can last 100 years. That’s what we’re doing with SHOP.CA. We’re not building to sell or sell out: we’re building to grow and scale. I really think that if you can do that, the rest will take care of itself.”

 

An office culture that goes beyond business. During the Halloween season, the SHOP.CA team had an inter-office competition to donate goods to Toronto families in need.

The Road Ahead:

After speaking with Drew and delving into the emerging retail juggernaut of SHOP.CA, there’s no mistaking that it’s well on its way to irrevocably changing the way Canada thinks about retail forever. In just a few short months since its official launch the site has gathered millions of products as well as thousands of brands and retail partners. Those numbers continue to grow exponentially each day and as a result the site’s traffic has skyrocketed to a level that blows any other similar portal right out of the water.

What seems to matter more than any of this, however, is the unmistakeable sense of collaborative culture that Drew and his leadership team have built at SHOP.CA. It’s evident when you spend a moment with any member of their staff, but I had a chance to discuss it in further depth with Parham Mofidi, SHOP.CA’s Lead Software Engineer.

“I’ve never worked at a company where people walk in the door and first thing you can see is that they are happy and excited,” said Parham. “We work up to 10-12 hours a day so you’ve got to like the people you work with and I’ve never worked with a group of people I’ve been more happy with. We can ask eachother for anything.”

I asked him to describe what steps the team took to build this kind of work environment and his praise was effusive. “You just have to look at Drew to see how he talks to team members. It will sound weird, but he’s more like a friend than a boss. That brings us closer.”

Parham also went on to describe how growing together from a plucky start-up brought the team closer together and ultimately contributed to their cohesive collaborative spirit. “When we started together I remember we’d sometimes be pulling all nighter’s at our desks after hours.  When you hear someone you work with snore for the first time you know you’re really part of a team.”

At the end of the day, it’s that kind of collaboration that has likely contributed to SHOP.CA’s explosive success more than anything else. And while Drew assures me that it’s only just begun, with the brand having big plans to expand globally into the US, South America and Europe in the near future… it’s the journey more than the destination that seems brightest for him and his team.

“The last thing I’d say is that when you’re doing this you’ve got to enjoy the adventure. That’s why we believe so strongly in what we do and in our Canadian roots, and that’s why I sit out there with my team. We want to do this for the rest of our lives.”

It’s definitely a dream worth having.

About Jordan Markowski

Jordan is the Content & Community Manager for Dx3 Canada and AndroidTO, as well as the Editor of the Dx3 Digest. He can be reached at Jordan@Dx3Canada.com for any comments, questions or story suggestions.

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