Entrepreneur Focus: "Our mission is to disrupt the gardening centre industry"

Thursday 21 September 2017

David Scott loves gardening so much that he wants to change the way we think about plants. The 44-year-old technology entrepreneur first dipped his green fingers into horticulture around a decade ago, when he launched the Jersey-based online garden centre Bloomingdirect.com.

When fulfilment contracted, he sold the business to a UK firm; but Mr Scott is now back with GardenTags, an innovative social network for gardeners. The app has been downloaded 200,000 times, there are 100,000 users, 500,000 photos have been added and it is used in over 40 countries.

Express asked the founder, David Scott, to explain what it does.

David Scott: It is a platform for gardeners with an app available on both Android and iOS and we also have a developing website. It is first and foremost a social network where users can share their gardens. At the core of it is an encyclopaedia of plants with all the care instructions for the plants.

We have also recently introduced an affiliate plant sales feed so users can compare prices and buy plants through partner retailers; the actual purchase is made on the retailer’s site and we take a commission for those sales. And we’ve now introduced our own market place so our members can sell their own excess produce - a lot of our members grow plants from seed themselves and they will produce little plug plants. They’ve been offering those for sale through our app and also doing things like seed swaps but we’ve had no way of facilitating that or indeed getting any cut of the action; so we have produced a market place which allows them to trade between themselves.

We’re also encouraging some of the larger independent nurseries around the UK, who don’t have an e-commerce capacity themselves, to use our market place to start selling their produce.  So that’s what I mean when I say a ‘platform’. It is a lot of different things but it is devoted to servicing the gardener and somebody who wants to build a garden from scratch and then share that with others.

Express: What are the sort things that people post?

DS: On the surface of it, it looks a lot like Instagram - but an intelligent Instagram because behind each picture is all the information and knowledge about that plant. Our first step with GardenTags was to build a social network because we wanted to engage a large audience who would start adding content. The value of GardenTags is the data, so every time somebody posts a picture we know exactly where that specific plant is growing in the UK, so we are building up a lot of valuable data about where particular plants are flourishing and perhaps where they’re failing. A lot of the passionate gardeners and hobbyists out there have really engaged in the app and fed it with a lot of data; and then along come the novices who are looking to get a plant identified or a question answered.

They’ll find us though search engine optimisation and jump on the app. Having engaged with experts in GardenTags, they’ll become engaged themselves because they are getting all of their questions answered.

What you can do in the app is you can build up a picture of your garden so it catalogues all the plants in your garden and people get quite addicted to that.

Express: Why did you choose gardening to focus your efforts?

DS: Our mission is to disrupt the gardening centre industry. The traditional way of buying plants is outdated and the modern shopper of plants is a young, time-starved person with a much smaller garden than in the past. It’s much easier to get your head around making a smaller space look beautiful than the old-fashioned larger gardens. Ultimately, where we are taking this is if you’ve got a space that’s this size, you browse through the app, you become inspired by looking at themes, you find the theme that interests you, you can then see all the plants that are in that garden throughout the season and then you can say, “yes that’s exactly what I want” and you can purchase those plants through the app.

Pictured: "We’ve built an incredibly engaged community and for us that’s the big success story," says David Scott of Garden Tags.

Express: How did you turn your idea into a reality?

DS: Taking it from an idea to a proof-of-concept live app took us about a year and we funded that ourselves. My background is IT and I had somebody working with me who was an iOS developer so I managed to fund his time for a year to build the first version of the app, which went into the App Store at the end of 2015.

It was very well received and we had some fantastic feedback, so we decided it was time to look for investment. We initially went to Digital Jersey who suggested we apply to the Jersey Innovation Fund. That took quite a long time but we were awarded £400k from the Fund – however, it was closed down just before the money was due. Fortunately, we had gone through an exhaustive due diligence process to get to that point, so when we then looked for that money privately, the process was actually remarkably straight forward.

Express: Where did you go next for investment?

DS: It took us about three months to replace the money through six or seven Jersey-based shareholders, and that gave us enough to devote a year full-time to building the app. Our first objective, through the advice of our shareholders and various individuals within Digital Jersey, was to get scale and engagement. That meant getting the app off the ground, marketing it, advertising it through channels like Facebook, Instagram, Twitter and Pinterest, acquiring more users and getting them engaged.

We had a fantastic first year: we hit all of our growth targets in advance of the plan and then it came to second-round funding, which we started last summer. During the first year, we had spoken to a lot of investors who were interested in how things were going; but then attitudes changed, probably due to the changing economy and the struggles that some of the ‘unicorn apps’, such as Uber and Snapchat, had had to make any revenue.

So, although investors were impressed with our first year, they wanted to see evidence of revenue.

For the second-round funding, we changed direction and that’s a key thing with a start-up: you’ve got to be prepared to pivot your business, in terms of what you’re actually doing but also your strategy.

We had to very quickly change it from growth and engagement to proving revenue. We cut back on all advertising and now the app is just growing organically; instead, we are now building all the revenue channels into the app that we had always planned. There’s now a premium version of the app, which gives you quality care instructions, including videos from our experts showing you how to do things in your garden, as well as the retail side and the market place.

Express: Could you appreciate the rationale of the would-be investors?

DS: Absolutely. It’s quite scary to go out there with an idea, acquire a huge amount of investment and then plan to do nothing except build your platform and not make a single penny for the next three or four years. That was our initial strategy, which was based on the way the market was going and what was recommended to us. What we’re doing now feels much more sensible and we’re starting to see those initial green shoots of revenue. Once we have the investors’ confidence, we can return to growing the app, as well as revenue.

Express: Was it difficult to ensure that the investors’ objectives and your objectives were aligned?

DS: There are a lot of investors out there and it’s important that you find ones who believe in your goals. That is important otherwise there will be friction down the road. We initially spent a lot of time looking for the second round of investors who shared our vision to grow first and worry about revenue second. It took a long time, because those investors just didn’t exist anymore so we had to change our strategy and bring ourselves into line with the available investors. That was a big learning curve for us, but they were right.

Express: Do you think Jersey has an investment culture?

DS: It’s certainly growing. We’ve looked for money in the UK and Jersey and we’ve spoken to a number of potential investors in the USA, where it’s still very much ‘growth first, revenue later.’ The UK is becoming less risk adverse, and while Jersey is the most risk adverse, there appears to be more investors and they are certainly happy to help new start-ups. They certainly want to see a strong case for revenue and long-term profit, whereas at the other end of the scale, in the US, they don’t even talk about revenue or profit, they just want to see scale.

The UK is a different thing all together because it has a lot of tax breaks for start-ups.  We would have done very well in the UK because investors will give you the first £200k-£300k because it’s essentially tax free. But we chose to stay domiciled in Jersey, not least because it has a strong gardening culture.

Express: Has the investment you’ve had so far been what you want?

DS: The first round funding went fantastically well and we had a great head of steam for the first few years. The second round of investment wasn’t as a big as I’d hoped because we have a number of investors who are interested but are waiting in the wings for us to prove the mechanics of revenue-raising and, as a result, we’ve had to make some cut backs and slow things down. There is a lot of functionality that we want to add to the app and website but we are unable to do so until we prove there’s revenue. As an entrepreneur, that’s incredibly frustrating because you just constantly want to keep developing, but patience is a virtue. We’re starting to see some early signs of revenue and we’re looking forward to next spring, when a lot of the hard work we’ve put in over the last six months will come to fruition. That’s when we’ll be looking at closing round three.

Express: So you’re optimistic that you’ve created an app that will grow and deliver?

DS: We’ve built an incredibly engaged community and for us that’s the big success story. We’re very happy with that and now, of course it’s just a case of working out how to expand that and make the most of it. We’re growing in the US as quickly as we are in the UK.  We haven’t yet implemented the client retailing in the US, but we will do that very soon and also it’s always spring or summer somewhere in the world. We have a very large community of gardeners in Australia so what we’ll be promoting those Australian gardeners to our UK audience so that they’re still active on the app during the British winter. 20% of our users have been engaged with GardenTags over the past 180 days and that puts us in line with the top 50 apps in the App Store. It’s certainly exciting times.

This interview also appears in the business magazine Connect, here.