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How We Started a Viral Business

We were aiming to create a viral business model, but it depended on getting an initial critical mass of loyal style mavens to become members of our company.
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It is not every day that one gets to start up a business with a close friend of 14(+) years. Over the past 18 months, our start-up has grown from a small room of six people to a booming office of 200+ and counting. We have put in much of our own blood, sweat and tears into what has truly become an experience of a lifetime for us both. Here's a glimpse of where this wild ride all began and where we are today...

October 31st, 2007, Halloween night-

The evening before our official November 1st launch... We were a small but determined team of six people wholly dedicated to successfully launching our start up concept of Gilt Groupe. Our amazing engineers each pulled an all-nighter to make final tweaks to the code for our site before we would officially blast invitations across the country.

November 1st, 2007, Gilt Groupe's membership launch-

Show time. Over the course of the day, we sent out invitations to join Gilt Groupe to every single person we had ever met. Several tens of thousands of emails left our servers to sprinkle inboxes (and unfortunately spam filters) of potential Gilt Groupe customers throughout the United States. We were aiming to create a viral business model, but it depended on getting an initial critical mass of loyal style mavens to become members of our company. We thought that once they joined and hopefully quickly became obsessed with Gilt Groupe, they would in turn spread the word to all of their nearest and dearest.

Fortunately, our friends -- fashionable, highly educated and tech savvy -- were the perfect demographic for Gilt Groupe, so it took almost no convincing to get them to join our website as members... membership was free... We promised to find our Gilt Groupies the very best brands, for unbeatable prices. Our platform also removed all of the stress of NY sample sale shopping. No lines... No getting strip searched... No crazy women grabbing shoes out of your hands... No sneaking out of work and faking a doctor's appointment. No being forced to pay with cash and running frantically to ATMs across the garment center... No nastiness... No damaged or shopworn merchandise... why wouldn't someone join Gilt Groupe?

November 13th, 2007, Gilt Groupe's first sale-

Zac Posen was our first sale on our site. We were so nervous. Would anyone buy anything? Even more important, would anyone visit the site during our 36 hour timeframe? In the 13 days that we ran our membership launch, we amassed approximately 15,000 registered Gilt Groupe members. Between the two of us, we knew almost all of these people -- they were our friends and the friends of our friends. We thought 9am seemed like a good start time for the sale because a lot of our NY friends would just be arriving in the office and could probably do some online browsing before their days got hectic. However, we didn't think about the West Coast... 6am over there. Painfully early! The morning of the sale, we were positioned to act as customer service. We did not know if our phones would be ringing off of the hook with questions from our members. Or perhaps our members would email us with their specific questions. Does a dress run particularly small? From what season was the merchandise? What if a top didn't fit, could it be returned? Was the product authentic? We were intimately familiar with the product since together we had hand-selected it in Zac Posen's showroom.

As the sale went live, our engineers noticed a traffic spike on our site. Lo and behold, sales began to trickle in... Our first purchase was from state of Missouri! We were puzzled. How did someone on Missouri hear about us? Neither of us knew anyone there. It was our first sign that viral marketing works. Our next order came from zip code 90210. It was 6:05am in Beverly Hills! We couldn't believe that someone in California had woken up so early to shop from our site. The concept was working and after 8 hours, the Zac Posen sale sold out and we were elated.

Today, 18 months later, we have truly experienced hyper growth during a time that has been trying for many businesses and we are so gratified to have been a part of every single step of the process. We changed our start of sale time to 12pm EST, friendlier for the West Coast. We now offer our members over 25 sales per week. We have over 1 million members in the US. We launched our business in Japan in February 2009. Our warehouse space has expanded from one small room to three bustling studios that are in constant use. It's gratifying to see how far we've come and thrilling to think how we will grow. Stay tuned for updates on our adventures, challenges and continued growth.

To visit Gilt Groupe, click here.

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