Focus or diversify?
Earlier this year I wrote a post about whether it’s better for a startup to focus purely on one business or diversify into related areas.
When I wrote that post I had in mind the online glasses retail concept Sneaking Duck that we’re now close to launching. We initially had the idea for Sneaking Duck 18 months ago, not long after we launched Shoes of Prey. Spending a lot of time in China we could see all sorts of products that would be great to sell in Australia, but the one that stood out most was prescription glasses.
Jodie, Mike, and I all wear prescription glasses and in China, it was easy to get very fashionable frames at very reasonable prices. After our second or third trip, we each had 5 different pairs of glasses and were accessorizing with them, matching them to different outfits.
As entrepreneurially minded folk tend to do, we put together a business plan for an online retail glasses business and loved what we saw. At the time, though, we were super focused on launching and ramping up Shoes of Prey, so we left the business plan on the ‘to think about’ pile.
As time went on we couldn’t shake off the idea. We saw Warby Parker launch successfully in the US with a near-identical concept. We were keen to go ahead but Shoes of Prey was tracking very nicely and we didn’t want to lose focus on that business. So we decided the only way we could go ahead with Sneaking Duck was to bring another person in as a co-founder and CEO. They would take the lead on the new business and utilize the experience, relationships, team, and infrastructure we’ve built up with Shoes of Prey. Mark Capps joined us in this role and we think we’ve struck the perfect balance between diversifying into a fantastic new business opportunity while maintaining our focus on the Shoes of Prey business.
That’s not to say it’s been an easy decision. It has not been a clear case of black and white as to whether we should be maintaining a laser-like focus on Shoes of Prey or diversifying with Sneaking Duck. We’ve been speaking with a number of investors about potentially investing in Shoes of Prey and the response from them to this decision is indicative that this is a grey area. Some love the move we’re making and see it as a plus, others dislike the loss of focus on one business. We’re confident we’ve made the right decision and that we’ve taken a smart approach in bringing on Mark to co-found and lead Sneaking Duck, and we’ll be keeping in mind the focus issue so that any impact on Shoes of Prey is limited.
Do you think we’ve struck the right balance? How would you have approached this?
Michael Fox managed Google’s online sales and operations agency team for Australia and New Zealand before co-founding Shoes of Prey, an online retailer which allows women to design their own shoes. He blogs in detail about the process of running Shoes of Prey at his blog www.22michaels.com.
