We spoke to Lucas for the Courier Weekly podcast. Listen to the full interview here.
‘Because I started a hedge fund, I really learned what an investable public company needs to look like. Then I spent the past six or so years working at startups, learning how you can use venture capital to accelerate and scale, but also the massive pitfalls with that, ie, valuations going too high and too much money on paid acquisition.
‘It was really [co-founder] Sam’s and my passion to create a sustainable high-margin business and a profitable one. But definitely use venture to scale. And we didn't want to get into this issue of becoming a DTC paint brand – the big problem with that is creating a business where the customer doesn't differentiate you from your competitors as you're all acquiring customers online digitally.
‘We saw some of the issues that happened in France in the mattress market. And we've even seen businesses like Away and other DTC businesses move into other verticals.
‘So it was our desire to really create a home decor brand, from day one, that starts with paint, because it's the colour that influences a lot of the other decisions you make around the house. And that definitely resonated with Felix Capital. And I think if we had gone out to the funding round and tried to raise as a DTC paint brand, I don't think we would have a huge amount of success.’
So, built into the deck was [the idea that] we're going to become the platform for all sorts of home decor?
‘Yeah, we were sort of Made.com for home decor. We would say, definitely the UK venture capital landscape, which is sort of more reserved than the US, is fearful of DTC. It made sense to us to build a multi-vertical brand, so we raised £850k from some really smart investors at the end of last year, and we were close to running a profitable company.
‘We wouldn't need a huge amount of money to get there, but we decided to accelerate the funding round and bring forward that raise and work with Felix Capital as the perfect partner in our eyes, because the market dynamics meant it was such an interesting opportunity. Plus the kind of growth opportunities with multi-verticals in Europe meant it made sense to us rather than just, “Let's raise some money and let's buy a huge amount more customers.”’
Find out more about Lick at lickhome.com