We asked what advice he’d give to someone starting up a new business, and what he thinks the next online trends will be.
When I suggest that Zopa’s a new concept, Giles disagrees: “People have been lending and borrowing amongst communities for years.” He maintains that all they’ve done is take the concept and put it online.
It goes to show that you don’t need to come up with a revolutionary idea to start an online business. It’s much easier to extend an existing concept than come up with a new one from scratch.
Price or personality?
Giles says that to create a successful internet business, you don’t necessarily just need to provide a price advantage. But it does really help to give people something they enjoy using.
“You can’t explain eBay’s success on the financial utility of the business,” he says. “There’s something about people enjoying it. They seem to enjoy transacting with other people more than institutions.”
Maybe you can harness social trends to benefit your business. When Zopa launched, the team behind it realised there was “quite a strong, growing demographic of people who wanted greater control over aspects of their lives.”
They used this to the site’s advantage, targeting those people by offering more control over how they invested, lent or borrowed money. So if, as Giles says, people these days “don’t subscribe to a one-fits-all philosophy”, ask yourself how you can give every user of your site a personal experience.
Everyone makes mistakes when they’re starting a business and Zopa was no different. Giles says, “we were probably too cautious in the first iterations. We also thought that a business like ours would be best marketed conventionally. Actually, we have to have a much slower burn.”
The key seems to be to think things through, but don’t be surprised when they don’t go exactly as planned – and keep an eye out for any new opportunities too. Sometimes you can turn unexpected events to your advantage.
Social networks and the future
2007 was the year social networks really went big. Indeed, Zopa itself is a social network of sorts. Despite this, Giles doesn’t spend much time on the network of the moment: “I haven’t really got into Facebook yet.”
But he recognises the site is an important one, readily admitting: “We’re working out ways we can work with Facebook.”
Should you do the same? It probably depends on your business and its audience. Giles says that “for people in their mid-20s, everything is about their trusted community.” If those people are part of the target group for your online business, social networks could be a valuable way of reaching them.