A tour of the Privalia offices has nothing to do with walking through Las Rozas Village in Madrid or visiting La Roca in Barcelona. The headquarters of this online sales club is located in 22@, the technological district of Barcelona, ​​​​and is a swarm of young people who work tirelessly in front of the computer so that the company continues to be the leader among virtual sales outlets in Spain. Italy, Mexico and Brazil, the four markets in which the company operates. On its website, the customer can buy clothes and accessories from the best brands at prices that are in no way inferior to those of a physical retail store.

Is he Affordable luxury at the touch of a button, a phenomenon that is growing like wildfire in the most developed markets, with the complicity of an economic crisis wreaking havoc on even the best of pockets. The success of this company is the work of José Manuel Villanueva and Lucas Carné, two Catalan entrepreneurs who met while working as business consultants in Madrid and came to the conclusion that if trips, hotel rooms, books or records are sold on the Internet why not try it with luxury clothing and accessories. Quite an adventure that nobody in Spain had dared to do back then.

ENTREPRENEUR. Privalia did not have an easy start, starting with a lack of funding. How did they manage to move forward without financial support?
LUCAS CARNE. We drew up a good business plan and knocked on the door of potential investors. But the truth is that we didn’t get any money until we started the business and showed that you could sell clothes online. Then we closed four rounds of financing in the history of Privalia, from a small first of 300,000 euros to the last, which was eight million euros. As an entrepreneur you have to forget the banks because you don’t exist for them. They arise on the day your business generates recurring revenue, but not before. That’s one of the big disappointments you experience when you start a project like this. The only option is to seek money from business angels, from small venture capital, or from the savings banks’ seed capital vehicles.

EMP. You had to fight against all the elements because it wasn’t easy to seduce the leading fashion brands either.
JOSE MANUEL VILLANUEVA. Being an entrepreneur is like being a beggar. In the beginning, hardly anyone trusts the new concepts. Brands didn’t want to sell their products over the Internet because the Internet has historically been associated with little distribution control. In addition, there have been other online sales alternatives that have led to counterfeiting and parallel markets. Because of this, the big brands have been concerned about marketing their product without scrutiny, even though they have relied on measures that have shown that the model works.

EMP. What brings Privalia to a major luxury brand today?
MVP Working for a sports company, I recognized the challenge of selling leftovers in bulk and in an elegant way. We offer brands the ability to sell tens of thousands of units in four days. In addition, we offer them a very important follow-up and brand reinforcement, since we have a user community of more than 2 million people in Spain, which makes Privalia a very interesting showcase for them. Every day more than 6,000 people in Spain shop at Privalia.

EMP. Many people will wonder how it is possible to make money selling clothes by giving discounts of 70%.
LC Buy primarily directly from the brand and without intermediaries. We sell the product that the brand has not been able to sell in the four months of the collection period, so we are already acquiring it at a significant discount. Apart from that, we have to keep in mind that we are more efficient than traditional trade in the whole value chain of the company. We don’t have physical sales, so we don’t pay rent, we don’t have in-store staff, and our users do the marketing for us thanks to referrals. We can discount not just because we shop at discounts, but because technology allows us to be much more efficient than in the physical economy.

EMP. Did they manage to eat land to the physical outlets?
LC In general, we have a much younger audience with a medium to high socio-economic level. In the end, the nature of the product is the same accessible luxury; But while you have to take the car to the conventional branch, everything is done here with a click of the mouse. It’s a different mentality.

EMP. And isn’t it a hindrance for the consumer not to be able to try on clothes before buying?
MVP To counteract this, as a specialized fashion store, we strive to describe the products well through photos and offer all the tools so that the consumer buys safely. I’ve had the experience of going to a physical outlet and it was good, but then it took me three hours to queue to get to the toll booth. That doesn’t happen in Privalia. Every day you have more than 1,000 products to buy without leaving home. We offer around 500 brands throughout the year.

EMP. Yours must be one of the few industries that has benefited from the crisis…
MVP We say it did us no harm. We’ve grown a lot, we’re still growing, we’re a counter-cyclical sector when the economy is in trouble, people are more sensitive to deals and brands have product availability. But it’s also true: when the economy is doing well, we continue to grow because the brands see us as partners and not as a one-off opportunistic channel.
LC Privalia is not a stable company that has grown more with the crisis before it has already grown by 1,000%. The effects that the crisis can have on the company are very small compared to the strong expansion of the company. Crisis or not, e-commerce continues to grow at above double-digit rates, as does internet penetration and the company’s offering and users.

EMP. Judging by the photos, they form a well-rehearsed tandem. How do they manage to live peacefully together at the top of the company?

LC We created an original structure as we are both CEOs. This requires understanding and a shared vision of the company. Then everyone has very clear roles, although we go hand in hand in making the big decisions and running the company. José Manuel heads the business units in Spain, Italy, Brazil and Mexico; Each of them has a Country Manager reporting to them. There are other business areas that support all markets that I manage, such as after-sales, CRM or technology. This split means that if we need to be locked into a funding round for six months, we are not distracted from achieving business goals.

EMP. And what happens if there are disagreements?
MVP. In the end it’s like a marriage, sometimes you have different points of view, but since we are civilized and constructive people who want the best for Privalia, it goes ahead without major problems.

JUST LOOK

LUCAS MEAT
Age: 37 years.
Spanish nationality.

JOSE MANUEL VILLANUEVA
Age: 34 years.
Spanish nationality.

Business Milestone:
We created the largest online fashion outlet in Spain and successfully exported the idea to Italy, Mexico and BrasSick.

The key: Offer luxury fashion brands the opportunity to sell their stock from previous seasons and offer them to the consumer with discounts of up to 70%.

Employees: 468