13 Years Later Cafepress Completes IPO

Cafepress went public this morning after 13 years in the making. This is in stark contrast to the 6.5 years it took the average venture backed company to reach IPO in 2011 (DJ VentureSource). Fortunately for cafepress’ early investors, the company only required $18Mil in venture financing over the past 13 years, which is a fraction of the $85Mil that the average venture backed company needed to reach an IPO in 2011 (DJ VentureSource).

Cafepress is an e-commerce platform for custom printing and production. In it’s simplest form it allows you to print custom t-shirts for your student club or custom coffee mugs for your small business. Cafepress’ “secret sauce” allows it to ship custom orders within 72 hours of placement, and sometimes within the same-day. The company’s streamlined operations also allows it to complete orders of any size with minimal setup costs. Cafepress’ 15Mil members have created over 320Mil unique designs to date.

Cafepress also owns and operates CanvasOnDemand.com, Imagekind.com, GreatBigCanvas.com and InvitationBox.com.

Here’s a look at cafepress by the numbers.

Cafepress’ venture investors consisted of Institutional Venture Partners, New Millenium Partners, PacRim Venture Partners, Staenberg Venture Partners, and Sequoia Capital. Most notably, Sequoia did not sell any of its stake during the IPO and now owns ~17% of the company post-IPO.

Congrats to the team at cafepress on their recent IPO.


Social Commerce: Simplified and Sized

The definition of social commerce has evolved immensely since the term was first used in 2005, and the variety of definitions has only made the term more confusing. I surely don’t have the silver bullet definition, but I thought it might be useful to explain the basic concepts of social commerce and share some research on the size of the market.

If you have ever asked a friend for a recommendation on where to eat or where to get your clothes dry cleaned than you’ve participated in the most basic form of social commerce. It’s normal to ask friends and acquaintances for recommendations on all types of professional services and products; everything from mechanics and barbershops to hotels and clothes. These questions and recommendations form the basis of modern day social commerce, but social commerce involves much more than recommendations.  Social commerce also utilizes all aspects of social interactions that lead consumers to make buying decisions.

Put simply, social commerce is the form of e-commerce that emulates and enhances the offline social shopping experience. For example, rather than calling a friend to ask for a recommendation on where to eat, you can review multiple restaurant reviews and data points from your friends on Yelp. As another example, you can purchase a Groupon instead of getting a group of friends together and negotiating a discount at a local business. These are some of the most obvious examples of social commerce. However, social commerce companies come in numerous shapes and sizes, and all social commerce companies leverage one or more of the following social principles:

Social Proof – People want what others like them want
Scarcity – People derive value from exclusivity
Authority – People prefer to follow others that have perceived authority
Reciprocity – People like to help others that have helped them
Liking – People enjoy helping others they like
Consistency – People behave according to their public and voluntary commitments
(more about these principles: HBR, Scientific American, awarenes, Social Commerce Today)

Due to the variety of social commerce companies, the market size of social commerce is hard to determine. Social commerce companies range from e-commerce companies with business models dependent on social commerce (e.g. Gilt, GrouponFabBeachmint, Totsy, Yelp, etc.) to companies that provide social commerce tools to traditional e-commerce companies (e.g. 500friends, Baynote, tabjuicemybuys, etc.).

Booz & Co recently released a study estimating that the dollar value of goods sold through social media will reach $30Bil worldwide ($14Bil in the US) by 2015 up from $5Bil worldwide ($1Bil in the US) in 2011. This study only includes the dollar volume of goods sold through social media, which does not represent all of social commerce, but it is a good indicator of the evolving e-commerce market. Also, Business Insider published a report estimating that the flash sales segment (e.g. GiltFab, One Kings Lane, ideeliTotsy, etc.) of social commerce will reach $6Bil by 2015 up from an estimated $1.5Bil in 2011.

Ultimately, the social commerce space is very nacent and the way we connect and shop will continue to evolve in the years to come. The one thing we know for sure is that our social interactions will not disappear as commerce moves online.


From the Big Apple to the Emerald City

This summer, I’ll be spending six weeks interning at Totsy.com in New York City and eleven weeks at Amazon.com in Seattle. It will be a great break from school and a great learning experience.


Totsy is a private-sales site specializing in apparel, accessories, and parenting resources for moms and their kids (0-8 yrs old) that was co-founded in 2008 by the North American CEO of LALIQUEGuillaume Gauthereau, and digital media veteran, Christophe Garnier, . Totsy was ranked #36 on Forbes’ 2011 list of 100 Most Promising CompaniesTotsy is also a 100% eco-friendly company. Among other things, Totsy plants a tree in Peru in honor of every customers’ 1st purchase. If Totsy isn’t already on your radar, it should be. 

In January 2011, Totsy appointed David Niggli as its Chief Merchandising Office. David was previously the President of FAO Schwarz where he led the introduction of Barbie, Star Wars, Harry Potter, FAO Baby stores, and the full line of FAO Schwarz private label products. At Totsy, I will be reporting to Randall Schmidt, the head of CRM and Analytics. Randall was previously the Director of CRM at Lord & Taylor. I’m thrilled to work with these brilliant retail minds, and to learn how they think about e-commerce. I am also stoked to mix it up with the startup crowd in NYC. 

On the other hand, Amazon (the 800lb gorilla) needs less of an introduction. Amazon recorded revenue of $48.08Bln in 2011 (YoY growth of 41%) and ended the year with 56K employees (YoY growth of 67%). As of this writing, Amazon boasts a $84Bln market cap and a P/E of 134. Amazon has its paws in every aspect of e-commerce and is constantly planting seeds for the future.

During my time at Amazon, I will be working  as a Business Manager Intern in the Softlines category, which includes clothing, shoes, and jewelry. →

I’m extremely grateful for the opportunity to work at Amazon and Totsy this summer. I’m looking forward to earning my keep and drinking from a fire hose. Now off to brush up on MySQL.


I won’t sign your NDA! {not yet at least}

We’ve all had the experience of discovering a new product or business and thinking…I had that idea years ago. This is especially true with new consumer products and consumer facing businesses. Knowing that, I can understand why first-time entrepreneurs are so nervous about having their ideas stolen. However, what these first-time entrepreneurs fail to realize is that there is a massive difference between having an idea for a business and successfully gaining market share. Turning an idea into a business and successfully launching it to the masses requires an enormous amount of EXECUTION and at least a teaspoon of dumb luck.

Numerous articles have been written on the topic of Non Disclosure Agreements, but this continues to be an issue for first-time entrepreneurs. I was recently approached by an undergraduate student at the University of Michigan (Go Blue!) who wanted help with his e-commerce startup. The conversation only lasted ten minutes because he wouldn’t tell me anything more than that he was working on an e-commerce startup. He wouldn’t disclose anything about his idea unless I signed an NDA. Needless to say, I didn’t sign the NDA, and unfortunately wasn’t able to help him out. Following this experience, I thought it might be helpful to publish a list of articles on the topic of NDAs.

In summary: VCs don’t sign NDAs because they are constantly evaluating businesses and will often be looking at 3-5 companies in the same space as they decide where to place their chips. Also, a typical VC might look at close to 1,000 businesses a year, and it would be a nightmare to manage the paperwork and conflicts associated with signing NDAs. Lastly, and most importantly, ideas in and of themselves are useless and proving their origin is impossible.

There isn’t much I can add to what the below guys have already said. I will say that a company’s ability (and need) to require an NDA changes as it matures. Of course a late-stage startup like Facebook has the right to demand an NDA before disclosing information to potential investors.

Hope the following list is helpful.

On NDAs and Confidentiality – Mark Suster
Why VCs Don’t Sign NDAs – Fred Wilson
Why Most VCs Don’t Sign NDAs – Brad Feld
The Venture Capitalist Wishlist – Guy Kawasaki
Perfect Your Pitch – Brad Feld
Going to Raise VC? Here’s a Primer on Process, People & Powerpoint Deck – Mark Suster
Why a VC Will Take a Lighter to Your NDA – Startup Lawyer
Why Startups Shouldn’t Ask Investors to Sign NDAs – Jerome Gentolia


Hello World!

Gentleman Standing has officially launched! The blog will be focused on e-commerce, venture capital, startups, and my life journeys. I’m looking forward to sharing my experiences and insights. Take a look at the “The Author” page to learn more about me. 

Let’s get it started!