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Navigating Through Change - The Founding Story of Swappie | Slush 2023

Published
December 8, 2023
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Updated
December 18, 2023
Jenna Pitkälä
Navigating Through Change - The Founding Story of Swappie | Slush 2023
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Want to learn the best business insights from remarkable speakers at Slush 2023, but don’t have the time to watch the full speeches on YouTube?

You’ve come to the right place. Below is a summary of a speech by Sifted Journalist Amy O’Brien and Swappie’s co-founder & CEO Sami Marttinen.

(psst: the notes were automatically generated with Wudpecker's AI notetaking tool. If you'd like to check these notes + transcript + audio recording without needing to log in, press here.)

<p class="h1-rich">🤏 TL;DR</p>

Swappie is a Finnish company that focuses on refurbished smartphones, specifically iPhones, due to consumer demand and potential for growth in the used phone market. The company aims to expand within Europe and become the most efficient player in the market before considering further expansion outside of Europe. Swappie advocates for the refurbishment industry and pushes for legislation that supports repairability and sustainability. Action items include developing a plan to expand into new markets, continuing to focus on quality control, and advocating for the industry.

<p class="h1-rich">✨ Summary</p>

Sammy Martin's Serial Entrepreneur Journey

  • Sammy Martin has started and run 13 different business ideas under the same company before launching Swappie.
  • He believed in maximizing learning and finding the right business idea, even if it meant quick pivots.
  • The experience of running multiple businesses gave him a strong foundation and helped him identify the potential of the refurbished smartphone market.

Focusing on iPhones and Quality Control

  • Swappie chose to focus specifically on iPhones and smartphones due to consumer demand and the potential for growth in the used phone market.
  • They conducted consumer surveys and found that trust in quality was a major barrier for people buying refurbished phones.
  • By handling quality control in-house, Swappie ensures better margins, lower return rates, and higher customer satisfaction.

Expansion Plans and Market Growth

  • Swappie is currently focused on expanding within Europe, with the iPhone category still being the fastest-growing segment in the refurbished smartphone sector.
  • The company aims to become the most efficient player in this market and win every market they enter before considering further expansion outside of Europe.
  • There is still significant room for growth within existing markets and new markets in Europe.

Financial Considerations and Self-Funding

  • In the early stages, Swappie founders self-funded the company using their student loans and income from previous businesses.
  • They operated without salaries and reinvested all income into growing and building the business.
  • After meeting an investor who believed in their approach, they received a small investment that accelerated their testing phase.

Lessons Learned and Customer Focus

  • The founders learned the importance of being frugal and investing wisely in their early stages.
  • They also realized the need to be obsessed with understanding customer behavior and building the entire business around customer needs.
  • Staying humble and avoiding attachment to their own ideas was crucial in solving customers' biggest problems.

Pivoting and Founder Stigma in Europe

  • Pivoting is sometimes stigmatized in Europe, but the attitude towards entrepreneurship is changing rapidly, especially in countries like Finland.
  • Swappie's early success and growth helped overcome any negative perceptions of pivoting.
  • The founders believe that pivoting and maximizing learning opportunities outweigh the risks and challenges associated with starting multiple businesses.

Growth Strategy and Global Expansion

  • Despite being based in a small market like Finland, Swappie always had a global mindset and planned for international expansion from the beginning.
  • They scaled quickly into multiple markets and believe that their first-mover advantage and winning business model are key to surviving and standing out against competitors.
  • Expansion into new markets is seen as a natural progression, but the company is focused on dominating existing markets and maintaining operational efficiency.

Environmental Impact and Legislation

  • Swappie recognizes the environmental impact of e-waste and works towards promoting a circular economy.
  • They advocate for the refurbishment industry and push for legislation that supports repairability and sustainability.
  • Legislation changes are crucial to combatting the growing waste stream and ensuring a more sustainable future.

Consumer Attitudes and Economic Factors

  • While environmental concerns play a role in some customers' decision to buy refurbished devices, price and quality are the primary drivers.
  • As inflation and cost of living increase, more people are shifting from buying new devices to purchasing refurbished ones.
  • The gap between new and refurbished device prices continues to grow, driving the demand for refurbished options.

Managing Company Culture and Advice for Founders

  • Incentivizing leaders based on both hard performance metrics and cultural values helps manage company culture and drive growth.
  • Founders should align their mission with their business and be willing to adapt or change their approach to match consumer needs and personal ambitions.
  • Engaging in public affairs and advocating for the industry can have a significant impact, but smaller companies may benefit from joining industry unions and working collaboratively.
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Navigating Through Change - The Founding Story of Swappie | Slush 2023
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