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Contrary to its name, iglu.com is not an estate agent for Eskimos! It's the world's largest on-line ski travel service and provides exclusively signed accommodation to all winter sports fanatics.
Catering for a world-wide audience is not a problem: iglu.com has more than 12,000 properties, operating in over 300 resorts in 20 countries world-wide. At just one year old its monthly traffic figures are already exceeding the magic million a month and future plans to partner with portals such as Yahoo! and AOL will ensure it's the coolest site for out-door gurus to visit.
Richard Downs, Co-Founder and Chief Executive Officer of Iglu.com, is 33 and hasn't long to wait before becoming one of those infamous 30something millionaires. He spoke to techTrader about the challenges facing a site where the target community is small, seasonal and highly sought after.
Skiing is an active and expensive sport, how do these criteria translate to the web? Is your unique selling point going to be to offer reduced price skiing holidays to those who can't normally afford it?
Skiers are ABC1 by origin, which makes a great customer base to target. Recent research shows that seventy per cent of skiers are now on-line, who are often weekend bookers or city traders, preferring the convenience and greater knowledge available on the Internet. Saying this however, there is a sector of our audience that is price sensitive, who come to the site in order to find a bargain. We have pulled together package holidays for individually and directly sourced chalets, so that those of a more price sensitive nature can get great value holidays.
How did you raise the venture capital to set up the company?
Our first round of funding came from some friends of mine in the city and the London Business School. It was the first time that the LBS had ever made an investment in a new company, which marked their decision to endorse entrepreneurship as a way of life. Our second round of finance came from Geocapital, who have brought a lot of intellectual as well as economic capital to the company. We also have private investors such as David Potter.
What's your opinion on the state of the investment community in the UK?
It seems to be changing every month, and has definitely hotted up over the last year as it has gained momentum. A lot of people are still nervous about investing in internet companies, but investors are increasingly learning about the industry through observation and pro-active experience. The UK is now a much healthier place for an entrepreneur to be than it was last year. The market has become a lot more transparent, and the barriers for entry are being gradually lowered.
Do you have any plans for a stock market floatation? How will you continue to finance the site?
We plan to announce a floatation in a year's time. The timing of our IPO will obviously be very important owing to the seasonal nature of our business. When the time comes we will probably merge with another travel or media company that will provide us with further business help and capital.
Describe your business model and its appeal to consumers.
Skiing is a high information content purchase. Our business model allows the consumer to buy a skiing holiday or chalet, and provides the relevant information for them to book, by giving reports on snow conditions for example. We also offer the largest destination of skiing holidays on-line, with the added advantage of real-time booking.
Have you found it hard to build a skiing community on the Internet?
Skiers love to talk about skiing when they are together. Admittedly it is a big challenge to replicate this on the web. Last year we posted a bulletin board on the site, which enabled consumers to talk with each other, and exchange information about avalanches etc. We are also about to launch out French and German sites, where we are confident that a community of users can be gathered more easily, since the popularity of skiing in these countries is equivalent to the huge priority that is given to football in the UK.
Why did you choose the Internet as your platform?
Skiing is a fragmented industry on the supply side and a disparate industry on the consumer side. The sport is also an information-rich product, and the internet can help suppliers to pull together for the benefit of customers.
Do you have any interest in covering other sports?
Skiers are outdoor pursuit people who usually have a lot of money to spend, which makes us prime targets with windsurfing and mountaineering web sites for example. Our business is very seasonally dependent, so we are considering the idea of a partnership with another company whose focus is on summer related sports.
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