Storefront looks to fundamentally reshape brick and mortar retail space
Pop-up shop service co-founder envisions free shop space for brands and entrepreneurs - landlords could recoup investment with commissions
Six years ago, Mohamed Haouache left Wall Street after working as an investment banker for nearly 10 years. He jumped into the technology world in 2014 and founded Oui Open, an online platform to directly connect landlords and brands, designers and entrepreneurs, with an ambition to optimise use of retail space and make it easy and cheaper to find short-term leases.
The startup merged with Storefront last year to create the largest global marketplace for pop-up stores, and Haouache is now the chief executive of Storefront.
Having more than 10,000 listings in New York City, Paris, London, Los Angeles and most recently Hong Kong, Storefront is hailed as “Airbnb of retail spaces”.
But the French co-founder said he hoped one day they could lose the Airbnb label; he has a bigger dream – to achieve rent-free pop-up stores anywhere.
Why did you choose Hong Kong as your first stop in Asia?
We have discussed with our clients from the United States and Europe. More and more brands are interested in Asian markets, mainly China, and Hong Kong is an open gate and first step to entering China.
Hong Kong offers a lot of opportunities for luxury brands in Europe for example, many of them already succeed here. Locals have high purchasing power and the city attracts many tourists from mainland and outside Hong Kong.
Given that retail and commercial markets are moving to a flexible approach, they need more pop-up stores and more solutions for that. Storefront is a solution for setting up pop-up stores easily.
How can you change shop owners’ minds towards using your service?
Just educate them; we didn’t invent any thinking but we made retail more flexible by bringing technologies.
We approached all big landlords one by one, we started the project one year ago (before we launched the service in Hong Kong), it was quite challenging.
Landlords at that time still hoped to attract long-term tenants, we used a lot of energy to convince them. We just open opportunities for them, it costs nothing for them to try us.
Given the fact that retail is also changing, on one side, the economy is volatile, on the other side, foot traffic is dropping significantly in retail cities because of competition from e-commerce.
We found everybody was slowly moving towards taking the necessary step of working with Storefront.
How do you charge tenants?
Right now our business model is commission based, for every booking we take a cut. We also frame insurance, contracts, invoices. These small elements are extremely valuable for landlords, because you don’t have the know-how to do these things. More importantly, the insurance that we offer is unique, it is not easy to find an insurance policy to cover short-term rental.
What is your long-term vision?
Our vision now is to keep growing, to promote the pop-up store industry in any part of Asia. We’re going to be accessible in China, Singapore,Tokyo and South Korea. I would love to give random people the tools to open a retail space with their iPhone.
The longer term vision is that I want to make retail free, I believe retail should be a commodity and my belief is we should give every designer or entrepreneurs the ability to book the retail space free of charge. We can find a different business model for landlords. We want to free creativity, we want everyone to be next Louis Vuitton or Amazon.
To do so, we want to convince every landlord to offer free spaces. Basically the success of brands would be the success of landlords, because they will take commission. That’s the future for us.
Any interesting co-operation you have done?
We have been behind a pop-up store with Kanye West in New York, we helped Hermes to set up a pop-up store in Paris, and L’Oreal’s first-ever pop-up store.
The thing is that we initially thought we would only help serving small and upcoming designers. We end up working with a much wider range, from first-tier luxury brands, to small brands, that’s a big surprise for us.
After expanding your footprints in so many countries, what is the biggest challenge you have encountered so far?
The biggest challenge is internally. As soon as we launched in a country, we found we are behind the market expectations. In Hong Kong, we need to hire more people and to grow faster. We have too many request and landlords.
Actually we are not fast enough. We are very ambitious and our goal is to triple the company size by the end of this year. That’s the rule of startups. You grow or you get killed.