Velasca

Enrico Kazati was a 25-year-old banking analyst in Singapore in 2012 when he struggled to find high-quality, well-designed shoes. He did not come from a family of shoemakers, though his father was an entrepreneur in the textile industry. The personal need combined with a desire to change careers led him to start Velasca, an online brand selling handcrafted shoes made in Italy.

Enrico quit his job in November 2012 and launched the first collection and website in May 2013, roughly six months after he started full time. Most of that time went into sourcing products from suppliers, which he described as not easy at all, along with building the website and working out the launch strategy. The pitch was simple: by removing wholesale and retail markups, Velasca sells shoes made from comparable materials at about half the price of established brands. The company's flagship Artista ankle boot sells for 179 euros, roughly 185 US dollars, and costs around 80 euros to make, which gives a gross margin of about 50%.

The company spent its first year testing with small budgets because it was self-funded. Enrico said that by the time of the interview Velasca had served around 15,000 individual customers and sold about 20,000 pairs of shoes. Roughly one third of customers bought again within six months, and Enrico estimated customer acquisition cost at about 50 euros, which he said the lifetime value justified. The best seller was the Giacalustra, a classic plain-toe Oxford.

Velasca reinvests nearly all of its profit, plus raised capital, into marketing because it targets three to five times annual growth. Enrico said the lion's share of the budget goes to Facebook, and that display and video ads that tell a story and show the product work better than keyword advertising, which he sees as better suited to platforms capturing existing demand. The company also planned to raise average order value, which was about 210 US dollars, by adding accessories such as belts and bags.

Velasca had 10 full-time employees and reported about 60,000 euros of top-line revenue in its first year, 200,000 in the second, about 1 million in the third, and about 1.6 million in the most recent period. It had raised a 750,000 euro equity round, which Enrico described as a Series A in Italy but closer to a seed round in the US. The stated goal was to reach 4 million in revenue within 18 months.