News came out that Parker Gundersen, Group CEO of Zalora, has decided to quit.
And again, friends are asking us what our take is, especially since we recently shared our thoughts about the announced departure of SEA president Nick Nash.
Well, here are our thoughts:
- Gundersen joined Zalora in August 2016, and as you might know, it is really difficult to stick around with a Rocket company (that is not improving traction) for more than two years.
- We already covered Zalora’s challenges in an earlier blog article on The Low Down.
- Executives that hail from big MNCs tend to focus on compliance, while internet startup CEOs tend to break rules. Often the difference makes the business more (or less) viable. We are not saying that this applies to the case here – but it is possible.
- Zalora is still a very good brand – how it will fare moving forwards really depends on the strategy of shareholders and the board.
- Global Fashion Group, the holding company that owns Rocket Internet’s fashion portfolio, sold 51% of Namshi, their profitable Middle Eastern business last year.
- Namshi was profitable while Zalora is not. We believe the reason is not that Namshi’s team is vastly better than Zallora’s at execution, but the fact that they are in a better market. Namshi’s basket size is more than 2.5 times that of Zalora.
- You can see the comparison of their financials below:
Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected]