Multimillion-dollar online homewares business Temple & Webster is hoping to accelerate its growth over the next 18 months through a “strategic partnership”.
Chief executive and co-founder Brian Shanahan told SmartCompany this morning Temple & Webster, which turned over close to $20 million in the last financial year, has been approached by a number of retailers interested in taking a stake in the company.
A previous winner in SmartCompany’s Web Awards, Temple & Webster was founded in 2011 by Shanahan, a former managing director of Gumtree International and chief financial officer of eBay Australia, and Adam McWhinney, who led digital development at News Limited Australia for more than a decade.
The pure-play online business offers daily deals to its 100,000-plus membership on a variety of furniture, homewares and gift products from Australian and international designers.
“A number of retailers have approached us and put forward ideas and we are evaluating them,” says Shanahan, who says a strategic partnership would not be “just about cash”.
“We have access to funds already,” says Shanahan, who says Temple & Webster is currently backed by Macquarie Capital, which he says has been “extremely supportive”.
“We expect to grow to between $75 million and $100 million without a partner, but we recognise a partner would help us grow more rapidly,” he says.
Shanahan says Temple & Webster achieved more than $1 million in revenue in its first year of operation, boosting that to approximately $10 million in the 2012-13 financial year.
He hopes to build on those strong results by becoming “a household name” in the homewares space in Australia, and tapping into Temple & Webster’s existing membership base to expand into other categories.
“Ninety-eight percent of our member base is female, with high disposable incomes and we think they would be interested in other categories,” says Shanahan.
Shanahan says the Temple & Webster team has also been looking into expanding into other geographical regions, seeing demand for its service in New Zealand, Singapore and China.
And he admits a float on the Australian Stock Exchange is a “potential” option further down the track.
“It’s not top of the mind right now,” he says.
While Shanahan says the Australian retail market was “no doubt” affected by lower consumer confidence in the first half of the year, especially around the federal budget, his feeling is the sector has “bounced back” since June.
“In June, August and September, we feel consumers are coming back,” he says.
“Our business model is pretty unique in the retail space,” says Shanahan of Temple & Webster’s success to date.
“We offer a variety of products to members, the variety keeps them engaged and coming back,” he says.