Jamie Murray WellsSince its launch in 2004 with the model of providing glasses at a fraction of the cost of high street opticians, Glasses Direct has become a great e-commerce success story, and recently announced a second funding round of £10m.

I’ve been talking to founder Jamie Murray Wells about the story behind the growth of the company, the recent funding round, and the lessons for other entrepreneurs…

Where did it all begin?

We’re now approaching our fifth birthday, and I started it when I was at university and looking for an industry that I could flip onto the web. I was on an English degree, about to go onto a law conversion course, and having seen the size of the textbooks, was desperately looking for something to get me out of it!

I was looking at other concepts first, and selling glasses was the third I came to; I got fleeced £150 for a pair of glasses. I looked at them and thought, it’s just a bit of wire and glass, why does it need to cost so much?

So I looked into the costs and found that they could be made for around £15 a pair. I sent my prescription to the lab and then had two pairs that looked the same; the difference was that one cost £150 and the other £15.

I realised there was an opportunity here to pass on these savings to customers, so I got together with some university friends, hired a web developer and used the last £1,000 of my student loan to get it started. 

How did you start up with so little capital?

This was possible thanks to our suppliers – they would hold the stock for us, send the completed glasses out to customers and invoice us 30 days later. As we were taking payments upfront from customers this enabled us to get the business going.

I watched cash flow like a hawk, and was also helped by the diminishing costs of technology and software at the time, after the dot com bubble.

Other than this, I had all my friends working for me, and even kicked my sister out if her bedroom so I could use it as an office. I was the customer services, marketing, PR and accounts departments rolled into one.

We handed out flyers etc, but word of mouth really made it fly, and we were selling fifty or more pairs of glasses a day pretty quickly. After that it was a question of scaling the business and getting logistics etc into place.

If you want something to work on a £1,000, you can do it, it’s only necessary to prove that the concept works.

Was there a lot of resistance from your competitors?

There was a lot of opposition from the high street; some of the well known high street names put pressure on our suppliers as they saw the threat we posed to their business models.

We actually had to close down the website for a few weeks while we found another supplier, but we managed to overcome this opposition eventually.

If you are doing something disruptive, you have to be wary, but it just proved that we were doing something right to make them so concerned that they would resort to tactics like this.

Five years on, the industry has embraced the internet as they have come to realize that it’s here to stay. We are now the market leader, and the big players are looking to us for advice; we had some come to have a look around our offices to learn from what we do.

How long was it before you took some funding?

It was within a few months of launching, and we raised money through angels, as well as friends and family. I also managed to get people like David Magliano, who was marketing director at EasyJet and also worked on the London Olympics bid – he came on board and invested, we found an expert optomologist who joined the board as a non executive director and advised us.

We raised around £700,000 this way, and topped it up with further funding rounds, including the most recent £10m round.

How will you use this most recent £10m investment?

This will allow us to build the business out, improve the technology on the website, things like launching a webcam version of our virtual mirror tool, where the glasses will follow users as they move their head. We also intend to build our profile.

Where are you with the US expansion plans?

The US has always been in our sights, and we want to make Glasses Direct into a global brand. We are currently looking at our options and sorting out our structure. There are some competitors who have a similar offering to Glasses Direct, but it is debatable whether any of them are as big as us.

Glasses are a relatively complex product to sell online, how did you go about making it usable?

From the beginning we had some great usability experts to help us achieve this. We had usability guru Steve Krug look over the website, and after that we brought in David Carruthers as head of user experience on the site.

The design and usability is also something I’ve taken a keen interest in since the very beginning; I used to sit down next to the web designer trying to ensure that the site would be easy to use.

It’s an ongoing process though, as we often have customers into the office and watch and video them while they are using the site, as well as doing a lot of A/B and multi-variate testing.

You give customers the option of paying by PayPal, as well as postal orders and other methods, what was the thinking behind this?

I think that, however people want to pay, that’s how they should be able to pay, to not let someone buy from you just because they don’t have credit cards doesn’t make sense. As an e-tailer, you have to be on the customer’s side, and we try to put them first in our decision making.

What you seem to have in common with a lot of successful online retailers is a focus on customer service – is this one way for e-tail startups to differentiate themselves?

Yes, it is a big part of what we do, and the word of mouth that results from good service has been vital in building up the business. I have personally delivered frames to customers to see that they were happy with them.

In another example, we actually sent a pizza to a customer who was upset; we’re prepared to go the extra mile to make sure customers get the best service.

There’s a telephone number on every page of the site so customers know they can get in touch in they need to, our operators have no set time limits when talking to customers. In a lot of cases, buying glasses is a consultative process; people want to discuss colours, styles etc and we try to make it easy for them to do this.

We have always relied upon word of mouth recommendations from customers, so we add little gifts to orders, provide a little extra service, and try to surprise and delight our customers. This is the best form of marketing for us. 

When e-commerce is fully matured and everyone has a good website, a great range of products and competitive prices, excellent customer service will be the key difference.

Has the recession impacted your sales yet?

No, people are looking for bargains more, and what we do is provide a product that people need at a price they can afford. More and more customers are seeing how much they can save by getting their glasses from us.

We actually just had our best ever quarter this year, at a time when many retailers are struggling.

Finally, what advice would you give to other entrepreneurs?

1)    Start off small and grow big,  you don’t need to head straight to Canary Wharf looking for backing; all you need to do is test your idea out and prove that it works.

2)    If it doesn’t work, chuck it. People get too attached and sentimental about their businesses sometimes and stick with ideas for too long when they aren’t working out. If your first idea doesn’t work, there is always another around the corner.

3)    Surround yourself with brilliant people. No entrepreneur is great at everything; you need to be aware of your weaknesses and get the right people around