We decided to interview William Wolfram, the CEO of DealDash. A startup that's registered in Finland, but operates mainly in the US market. Not a very common sight, but then again neither is the business DealDash is in. The interview is quite a long one, but then again - we felt it should be published in its entirety as it contains a wealth of valuable information.
ArcticStartup (AS): In a few words, what is DealDash?
William Wolfram (WW): DealDash combines proven game-mechanics with discount shopping to create a fun and exciting buying experience.
Each day, DealDash lists hundreds of brand new products up for auction for shoppers to bid on. Every bid placed raises the price of the auction by $0.01 and restarts the countdown clock from 20 seconds. If no new bids are placed before the time runs out, the auction is sold. Shoppers purchase virtual credits before they can bid, each bid placed costs one credit ($0.60/each). Unlike traditional "penny auctions" which have unfortunately received a bad reputation during the last few years due to a few unethical companies in the market, DealDash removes all the risk of bidding by making it possible for any bidder that lost an auction to buy an identical product from DealDash at a normal, non-discounted price and get a full refund on all credits lost while bidding. We also generate a significant portion of our revenue from this "no risk" feature and DealDashers love it.
AS: DealDash is an interesting company, based in Finland, but operating in the US - what was the thinking behind this?
WW: We side with Frank Sinatra on this one - New York, New York! If we can make it there, we can make it anywhere. We want to be in business where if we succeed, we have the potential to have a massive influence on the gamification of discount shopping. The US market is tougher to break, but with the increased challenges comes far greater rewards. The gamification of online shopping has begun and we are determined to be a key player in the soon-to-be billion dollar market.
AS: What are some of the concrete advantages and challenges regarding the setup of the company (located in Finland, operating in the US)?
WW: We are very lucky to have such a brilliant international team. Our team members come from 4 different continents and we are very Silicon Valley inspired in our approach and working habits. DealDash maintains both a US office in Sunnyvale and an office in Helsinki, sometimes there are timezone challenges dealing with California, but that´s nothing that a few Red Bulls won't solve. There are many things to love about Finland, but when it comes to growing a tech based startup, there are few greater places to be. Especially in regards to the quality of engineers, international commitment, public support and smart people in general. We love it here and see it as a great place to launch out to other international markets from.
AS: How has DealDash been able to grow the business in the last 6 months or so?
WW: It has truly been an exciting time for our team and investors. We have again more than doubled our revenues and gross profits since January and the growth is creating new opportunities for DealDash. The game-shopping market is also expanding and maturing quickly, with more than 200 US based competitors vying for a piece of the action, many major competitors that have been funded with millions of dollars in venture capital have gone bankrupt. DealDash has been extremely fortunate to have made the right product and business decisions when it has mattered the most. We could not maintain our competitive edge and profit margins without our extremely dedicated team and world class board of directors.
Thanks to the growth, there is always enough work to go around - we are now processing 1+ million bids/month and hundreds of product orders daily, a very significant part of the business is also generated in the DealDash store which provides losing bidders with a convenient way to get a full refund on all the credits lost while bidding by purchasing an identical product from DealDash at a normal, non-discounted price.
AS: What about 2011, what are you expecting to happen later this year - where are you headed?
WW: Like earlier mentioned, many people have come to see the traditional "penny auction" business model as 'shady' or untrustworthy. We tackle these issues on a daily basis by maintaining complete transparency in everything we do, like for instance releasing auction audit reports conducted by independent third-parties or providing losing bidders or our 100% money-back guarantee. We hope to shed some light on this market and help legitimize the gamification of discount shopping. As we speak, our team is adding new gamification elements into to the shopping and bidding processes and we hope to continue to add to these through-out the year. We rigorously analyze the effects the new features have on specific segments of our userbase and constantly request and respond to customer feedback. Our customer lifetime value is increasing as a result of our data-centric approach.
During the remaining part of 2011, we hope to grow even faster than during the previous 6 months. Online discount shopping is truly lacking elements of fun and excitement that we would personally want to see in our own shopping experiences. We hope to integrate more social elements with DealDash and we are constantly adding new gamification functionality to the site.
AS: Anything else you'd want to add about DealDash or tell our community?
WW: We have some very exciting news that we wish to uncover soon. We are in the works of substantially increasing our market share in North America. We are also hiring more awesome people to join us in Helsinki so if you are a UX/UI designer guru or a genius web developer (PHP, MySQL, Memcached), direct response marketing expert or a B2B merchandiser rock-star come visit us ASAP!
Editor's note: You can reach DealDash through their website over here or contact us to put you in touch with William Wolfram.