11 Years of Global Savings Group (GSG): Why We’re Proud to be a Camel
11 years ago, GSG was born, emerging out of a pivot from our initial startup, Dropgifts. Today, we reach more people than H&M or Check24 and are far from done with our journey. It’s been a wild ride. 11 years since we started this journey and facilitated better spending decisions worth EUR >20bn for people using our products. 132 months of steady growth, starting with just 8 people to now being a team of 1000 around the world. 4000 days, where our team defied countless challenges and built a unique company in this space. As we are preparing for the most important period of the year - Black Friday season - it’s time for me to look back on the GSG journey and share some thoughts around the industry, our company, and the future - and to say that we are “Proud to be a Camel”. 2012 - How It All Started Back in 2012, we (with my fellow co-founders Andreas and Adrian) started in the most unusual setting. As one of the last remaining privately held companies that had its inception at Johannisstrasse 20 in Berlin - the old Rocket Internet headquarters - we jumped into a rocket ship called Dropgifts. After 2 months of “our highway to hell mission”, we had more than 150 people on the ground, more than 40 legal entities and a product that did not have a proper backend but was already live in more than 10 markets. Plus, we had 6-figure marketing budgets without even having proper tracking in place or any idea of the unit economics yet. I will never forget the seemingly endless nights as we tried to find product-market fit while still onboarding new advertising partners/brands such as Starbucks and Zalando. BTW: Dropgifts was a web-based platform that enabled its users to send gift cards from a variety of brands via Facebook and mobile applications. The underlying attitude and philosophy at the time was “the world can be conquered in less than 6 months”. This was part of the Rocket Internet DNA and speed was at the heart of everything that we would be doing. Learning in this environment is stressful and demanding, but it teaches you so much and we had the opportunity to learn from some of the best at that time - people who would continue to shape the startup environment in Germany / Europe later on. Obviously, we made our fair share of mistakes - mistakes that you can probably find today in any “how to scale your startup” textbook or as part of the first session of the Y Combinator training material. However, one thing we did get right. Early on, we understood that the Dropgifts model would take a lot of time and resources to achieve positive unit economics. So, after just 4 months we made a major pivot; we closed down Dropgifts. We could have continued trying to optimize the model for another 12 months on low burn rates, but took a bold decision to not go down that path. At the same time, we moved from Berlin to Munich to start something new with just 3 interns, 2 full-time employees, and plenty of learnings. By now, we also realized that persistence would be key to any future success and that we shouldn't chase overnight success - doing so had almost driven us into insolvency. Proud to be a Camel Accordingly, I'm incredibly proud of the journey we've embarked upon since then. Our story might not be as loud as some of the unicorns out there (flying under the radar can be quite helpful btw), but it's one of resilience, careful planning, and a steadfast commitment to building a lasting business. In a world where "growth at any cost" seemed to be the mantra for a long period, we chose a different path. We focused on balanced growth, a long-term perspective and diversification, adopting what Alex Lazarow aptly termed the "camel" approach (https://hbr.org/2020/10/startups-its-time-to-think-like-camels-not-unicorns). After all, as the Dropgifts experience indeed taught us early on - profitability should not be an afterthought. It was this philosophy that guided our every move since then. The GSG Story Unfolds Today, with offices spanning across Europe, Asia, North America, and South America, we've grown to a team of around 1000 employees. Our portals have registered tens of millions of users, serving billions of shoppers every year, and generating billions in sales for our retail partners. Let me make our story a bit more tangible for you. If you would compare us with some of the largest ecommerce sites out there, we would be among the top 10 in Europe, measured by the GMV (Gross Merchandise Volume) facilitated through our sites. Or if you take a different stat - did you actually know that in terms of traffic, we’d be in the top 50 ecommerce sites in the world if we combined the traffic across all of our sites, exceeding H&M’s global traffic and, in Germany, beating well-known names like CHECK24. Yes….go ahead and check it in Similarweb Today, our portfolio spans across 22 countries and includes some of the most prominent and influential brands for driving shopping decisions in the market. Among them are mydealz, dealabs, Shoop, iGraal, and Coupons.com, just to mention a few. Next to our own brands, we have also established strategic partnerships with leading global news publications including CNN, Business Insider, Daily Mail, and BurdaForward, where we help them to actually power their commerce content sections to drive value for their readers and advertisers alike. Our vision was always centered around the idea that with the rise of ecommerce, consumers would be overloaded with infinite shopping opportunities. In order to balance their time, maximize value and avoid frustration, consumers would look for better ways to cut through the commerce noise and reduce their research time by adopting new and incremental products, tools and services. Our vision in simple words: “We empower people to take smart spending decisions so they get more out of life”. As a result, all our products and corresponding shopping experiences that we have built and will continue building - from cashback portals, product review websites, voucher code portals to deal communities - have the ultimate goal of helping people make smarter spending decisions. The opportunity we saw back in 2012 was to integrate a lot of these different offerings and tools in one place, so that we could build shopping experiences across the same or multiple products that would support consumers along every step of the decision journey - from discovery to post-purchase. 11 years later, we are still in the middle of achieving that. We still have a long way to go as we plan to help more people as we connect our shopping experiences within GSG but also as we continue extending across more commerce verticals. It is ultimately during economic downturns and recessions that our services are most needed by people. The high inflation rates are pushing every household into a situation where driving smart spending decisions is a core priority. People are starting to worry more about inflation and the corresponding reduction in purchasing power than about climate change. On the other side of the equation, we truly believe in the need to build an alternative marketing channel that is value-adding. At a time when ad fatigue is massive, the largest search engine in the world is turning into an ad-driven shopping platform with cluttered UX, and every major platform / marketplace with first-party data has rushed to launch dedicated commerce initiatives, we believe that consumers will continue to struggle to get contextually relevant offers that really are effective. In addition, performance marketing (particularly the type when you pay only for successful transactions facilitated) will continue to gain further popularity as more brands will want to understand what all the money they are spending on platforms with an entertainment intent or through their brand budgets actually drives in value. I'm very proud to say that today, more than 85% of the top ecommerce advertisers (including Amazon, eBay, Apple and Nike to name just a few) work with GSG and I'm proud that we have been able to build stellar relationships across all verticals of ecommerce. Being able to offer more value across the different product lines we operate and delivering this out of one hand to our advertising partners will continue to be a strong USP. Our journey was far from an overnight success and while we may meet the criteria of a unicorn by some metrics, we wear the title of a "camel" with pride. We've been cautious not to stretch ourselves beyond our means, mirroring the frugality we see in our users. This also means that we're very cautious with our spending, vigilant about our revenue, and always prepared for the worst-case scenario. With it comes a healthy portion of paranoia, something that any business in a digital environment should bring to the table given the speed at which things change. We stay true to our beginnings and continue to not be shy of pivoting fast, closing initiatives that are not showing traction even faster and taking strong decisions as we always have done to keep pace with shifts in consumer behavior. Finally, frugality, in our context, doesn't mean being shy about investments or compromising on speed. Over the course of the last 7 years, we engaged in several M&A deals in order to drive our vision further. We do believe that as strong operators in this space, we can deliver substantial value from this approach, not only for consumers and advertisers but also for our shareholders. For example, our acquisition of iGraal, exceeding €100 million, is a testament to the fact that we will make bold moves when convinced of the underlying motives and value. Last but most importantly, there is our team. None of the above would have been possible without the incredible effort of every single person who has dedicated their talent and time to making Global Savings Group what it is today. Our people bring with them a phenomenal spread of skills, experiences, cultures and backgrounds but share united common values which really make our business different; we are #customerobsessed, and we understand the importance of creating the perfect environment to help people make smart spending decisions all around the world. Together, we are honest, we help each other to grow, learn and evolve. There are stories in our people; interns growing to VPs, commercial leaders taking on community challenges. The paths our people forge within GSG are inspiring and I feel so fortunate to be a part of their journey. VC-Backed, but Grounded in Reality The Global Savings Group story carries some of the characteristics of a classic German startup tale. We're VC-funded, and names like Rocket Internet, often associated with the aggressiveness of the startup world, have invested in our journey. You'll also find the familiar trappings of a 'cool' startup in our offices. But beneath it all, our focus has remained unswervingly on building a business that stands the test of time. HV Capital, one of our investors, shares our belief in long-term success over short-term gains and has supported our journey over the last 11 years. They've backed some of Europe's most successful companies, emphasizing the importance of endurance in today's volatile climate. For them, Global Savings Group is built to last. Our recent merger with Pepper.com was a natural progression. Beyond the strategic alignment, our shared values in building companies made this union seamless. Pepper's founder, Fabian Spielberger, shares our commitment to lean operations, careful hiring, and strategic expansions. Together, we form a powerful force in the ecommerce industry, with a combined reach that touches buyers at every step of their journey. By connecting the smartest minds in our industry, we create a complementary, unique and powerful platform; all focused on a shared vision and common understanding but driven by a diverse range of experiences, history, cultures, learnings, and backgrounds. Lessons from the GSG Journey Our journey holds valuable lessons for budding entrepreneurs: Build or buy? It can be both: We've built from scratch and strategically executed M&A. Today we work with more than 13,000 brands and platforms across multiple business areas, leading to a diversified but highly complementary business under one umbrella. VC funding with a purpose: While growth is vital, it doesn't have to come at the expense of a solid, profitable business. We've shown that profitability and VC funding can go hand in hand. Blitzscaling isn’t always the answer: Measured expansion can be more sustainable in times of rapid growth. Our steady growth post-pandemic, compared to some industry counterparts, is a testament to this Efficiency wins: Prioritizing efficiency and hiring with purpose can be more valuable than immediate, large-scale expansions. Customer-centricity is key: A strong focus on the customer has always been at the heart of our success. Quality content and a great user experience are and always have been our cornerstones. We hope our story serves as a beacon for entrepreneurs. It's not always about being the flashiest unicorn or being the loudest in your PR stories; sometimes, being a steadfast camel can pave the way for success. At least this is our belief…