One to watch
Company: The Naked Group
What it does, in a sentence: A luxury brand initiated in Kuala Lumpur, Malaysia, that includes The Naked Bar and Restaurant, Winner of Tatler’s Best Restaurant Award in 2015, NAKED Coffee; NAKED Pizza and in the UK, NAKED Beauty Salons, NKDb Cosmetics, NAKED Travel, NKDVini Wines and the Naked Film Foundation, a film crowdfunding company.
The newest innovation of The Naked Group is the development of NAKED LOYALTY, a loyalty programme with a unique crypto-currency block-chain technology (similar to bitcoin) called NKD$ (Naked Dollars).
Loyal customers can ‘earn’ NKD$ when they purchase products and services and then use them within the NAKED Group.
Founded: 2014, Malaysia. Franchised to the UK in 2015 and online globally in 2016 with further expansion plans in the pipeline.
Founder: Marco Robinson
Number of Employees: 15
What problem are you trying to solve?
I am using a technology called ‘blockchain’ to create a new currency called NKD$, Naked Dollars. The aim of this is to help people buy and be rewarded to buy in the products they love.
During my career and through my experience setting up several different companies, including a travel incentive company in 2008, I discovered that people aspired to brands that recognised loyalty.
I wanted people to eat at my restaurant and be rewarded for doing so, not just in the experience, but in currency by means of an additional benefit that they could spend across a variety of sectors.
This structure allows loyal customers to save money on their usual spending habits and be rewarded in every transaction they make whilst getting more value than with credit card rewards or airline miles.
How big is the market – and how much of it do you think you can own?
The bitcoin and blockchain market is reported to be approaching $1 billion in investment. It is a revolutionary way of spending, a notion supported by the banks heavily investing in it.
I believe I can achieve 1% of those industries in sales and I’d like to capture up to 50% of the loyalty blockchain currency market.
How do you make money?
I own companies within the travel sector, food and beverage sector, property, cosmetics and entertainment based on the blockchain structure. Blockchain drives revenue by rewarding customers that spend within our portfolio.
The Naked Group as a whole is projected to raise £15 Million in seed capital in 2016 and we have already secured £2m in pre-seed capital from my network. This has enabled us to build our technology and brand infrastructure.
We made £220,000 in profit in our first year of opening the Naked restaurant and now it turns over £1.5m. The real financial gains have been made by capitalising on the success of the original restaurant and turning this into a diversified brand. In the past two years our net profit has increased by 12%.
The brand has also diversified into the consumer sector and launched internationally. Last year we opened Naked Beauty Bar in the UK and this year Naked Beauty launched its own brand of make-up.
Who’s on your team that makes you think you can do this?
At my core, I am entrepreneur. I thrive on my personal drive to be better, to make more, to be the best I can be and to do justice to the brands I have built. However, no man is an island and ultimately, what you give out, is what you get back. The harder I work and the more of myself I give to a project, the more engagement I get from all those I am working with. It is a hugely positive working environment to foster. Suffice to say, I have a fantastic and exceptionally talented team around me, including my CTO Malvindran Ganesh, my COO Stuart Ockenden and my CMO Phillip Edmondson.
Who’s bankrolling you?
When I saw the opportunity to start something new with the Naked Group, I took the gamble of investing my own money into the business. It cost me £250,000 to set up the bar and restaurant. I broke even after 5 months and started making a profit after.
Some may say that having the ability to fund yourself is a lucky position to be in, and it is, but it came off the back of the financial success I had achieved in the property market where I had previously made huge gambles with loans and literally put everything on the line to try to become my own boss. I borrowed £890,000 from the bank in order to buy my first property and then went on to take out further loans amounting to £10 million. Luckily, it only took me one year to make my investment back.
So, whilst bankrolling The Naked Group myself was a privileged position, it came about on a foundation of huge risk. But what is business without risk?
What advice would you give other entrepreneurs trying to secure that kind of finance?
Not everyone is in a lucky enough position to be able to fund their business idea alone. But today more and more people are willing to invest in an entrepreneur with a great idea and the right business head on them.
I spent a great deal of time analysing what my business icons such as Elon Musk, Mark Zukerberg, and Tony Robbins had achieved and how they really made it from nothing.
I would encourage all budding entrepreneurs to seek a mentor they trust for business advice. The world of entrepreneurialism is a solitary place and it is so important to connect with people who have successfully navigated the entrepreneurial path previously.
This year I will be initiating a new investment company: The New Rich List. This is a mentoring scheme for entrepreneurs looking to learn from successful established entrepreneurs the skills they need to start their own business.
What do you believe the key to growing this business is?
The restaurant industry is notoriously unstable. Tenacity, grit and an unfailing belief in a concept is key. It may sound simple, but believing in what you are creating and being able to communicate that idea passionately with your employees, your suppliers and anyone that you come in contact with is crucial. You will be surprised how many people begin to back your business and how word spreads about what you are doing before you have even opened.
What metrics do you look at every day?
The number one metric for me is cash-flow. How much cash is my business generating daily, weekly, monthly and yearly. Cash-flow is the oxygen of your company and profit comes second, because you cannot profit if you have not invested. It is then important to look at return on investment, specifically in new customers, new markets and new efficiencies created by the intelligent use of tech.
What’s been the most unexpectedly valuable lesson you’ve learnt so far?
At the age of 29 I was working myself into the ground for a boss that did not appreciate me. I was so overworked and stressed that I suffered a heart attack and almost lost my life. Looking back now, this was one of the best life lessons I could ever have had. It forced me to take a step back and really look at what I wanted in my life and it pushed me into quitting my job, taking back my own financial freedom and becoming my own boss.
What’s been your biggest mistake so far?
I have struggled in the past to maintain a healthy work/life balance. Coming so close to losing my life due to a stressful and unhealthy lifestyle induced a heart-attack yet taught me the necessity of good health. Being unhealthy and unwell will really affect your business as well as those working for you. I realised that if I was going to be a success I needed to invest in my own health as much as my businesses. I now commit to going to the gym at least 4 days a week. I rarely drink and am conscious of how I fuel my body. Your body is the engine that allows you to work. It must be in tip top condition.
What do you think is on the horizon for your industry in the year ahead?
For the Naked Group, the focus every year is on maintaining the highest quality experience for all our guests at every venue. Because experience is intangible, it can really only be measured in good reviews, and relevant rewards such as NKD$.
We are also building our brand in the UK and this year will be focussing particularly on Naked Beauty products.
I personally will be focussing on the launch of The New Rich List entrepreneur mentoring scheme and the new crypto-currency. I am passionate about sharing my entrepreneurial experience and helping budding entrepreneurs get their ideas off the ground.
There is a lot going on, nothing ever lets up, but this is what keeps life exciting and makes me so excited to wake up, get up and make it happen every single day!
Which London start-up/s are you watching, and why?
Whilst quite mature start-ups, I really admire what TransferWise and World Remit have done- two forex companies that have disrupted the financial industry with technology. Reduction of forex fees is more important now than ever, especially after the EU referendum result.