E594 | EUCVC Summit 2025: Hermann Haraldsson, Boozt: Scaling a Nordic E-commerce Powerhouse & Lessons for Corporate Venturing

0:00Most companies get slower as they scale, not boost. In this conversation, CEO Hermann Heroldsen takes us inside a public company that's kept its startup DNA alive and used it to win in the hyper-competitive world of online retail. What does it take to build agility into corporate structure? And can innovation truly thrive after IPO? Good morning. when I told my 18-year-old daughter that I was speaking today and it was nine minutes, she says, ah, okay, it's kind of like TikTok conference you are doing. I said, hey, I guess you're right. Okay, a bit about Boost. We launched Boost.com in August 2011, so we are almost exactly 14 years old.

0:52We launched our second store, Boostlet, which is Outlet, in 2015. We broke even in 2016. And in 2016, our biggest shareholders, which were two VCs, Sunstone Capital, who are now hardcore and Verdane, they started to talk about exit. And then we discussed, you know, this exit, when should it be? We went for kind of a dual track, IPO track and a sale, either a trade sale or to a PE fund. and we went for the IPO track because basically we were kind of fed up with having this Troika talks with general partners and industry experts, etc. So we want to have full freedom. So we went for the IPO and we did an IPO in Stockholm in 2017 and then we did a dual listing in Copenhagen in 2020 and have been kind of dual listed since then.

1:51Until recently, we were the most valuable e-commerce company in the Nordics, but e-commerce has been under a bit of attack recently, so we are slightly down for the moment, like my favorite football team. 8.2 billion sec in revenues and 5.7 % in EBIT margin last year, actually making us the most profitable margin-wise e-commerce company in our business in Europe. When we started, we were like five guys who started, it was very important to us to build a strong culture and we built it on kind of three pillars, trust, freedom and responsibility. And most of you are Nordics and you can see that these are core Nordic values.

2:38So we've very much built kind of a Nordic company and we did not have much money to begin with. So we couldn't afford to hire people. So we need to run with trust, hiring the right people and giving them space to grow and make decisions. And give them full freedom as long as they were acting in boosts best interest. We spiced it up with a concept that we called the KY culture. And it's basically based on that when a person starts a job, it could be in a customer service. Then you have to know why. So I'm going to be taking calls or answering emails. And then they go through a phase called what we call the know what, which is basically the know how to answer the calls and service the customer.

3:25And then in the end, it's the know why. So basically why I may do this. Yes, because I know if my customer is satisfied, there's a high likelihood that they will come back and buy again. What actually painfully few go through is what we call the care why, when you go beyond what is expected of you. Basically, if you pick up paper from the floor, as you know, when we are in the warehouse, our warehouse director, he makes a test when he's having new employees, basically noticing, does he or she pick up garbage from the floor? If they do, they care. If they don't, maybe they're not the right people.

4:00So this is the mindset that we've been running the company from the beginning, and it's kind of served us quite well, and every employee talks about the CareWire concept. But again, as you're growing, because it's easy to be kind of 5, 10, 20 people have this KY concept, stuff like that, because you know everyone, most people have a stake, have a skin in the game, but it's more difficult kind of when you get 100, 200, maybe 500 people, how to kind of keep this startup mentality. And I didn't really know how to articulate what we're trying to accomplish until I stumbled upon this figure. figure, I guess most of you know it, probably most of you have been using it, the founders mentality from Bain, which is actually a really good description of what we believe is the right startup mentality.

4:50And the way I interpret it is three key things. One is skin in the game. You want people to have skin in the game, either by being co-investing, by having a strong incentive structure, or basically skin in the game. The second thing is what we call, you know,

5:17don't accept common wisdom in the industry. We were five guys that started Boost. None of us had ever worked in fashion. So there was a lot of people telling us, you know, this is what you should do. And we did a lot of stuff that we kind of did not know. and there was a lot of stuff that we did not know not to do, right? So we challenged the industry, conventional wisdom. We were extremely good operators and basically kind of didn't know what we were doing but in some ways scrambled along and did the right thing because we were obsessed with reducing friction for the customer. Use technology to reduce friction and use technology to also reduce friction for the staff.

6:07So when we were planning the IPO, that was kind of a breaking point because a lot of people said to us, yeah, now you're going to do an IPO, then things will change. And the IPO will change everything. You have to be compliant. You know, NASDAQ, they have the rule, stock market regulations, communications. Basically, they said, you will become more corporate. And the way I interpreted it was saying that, guys, then you will need to grow up. Hell no, we said, we can do both. So what we did was, okay, the IPO or the compliance stuff, it's really, really boring. You can hire experts to do that. You can hire investor relations people to do that.

6:48You can hire people in the finance team who make sure that you are extremely compliant towards what is required to be a listed company. And then, basically, we doubled down on our startup mentality, made sure that we emphasized, staying a startup, emphasized the founder mentality. My role changed a bit because I'm no longer in doing all the bits and pieces. I used to call myself the machinist, greasing the oils and the machinery. But I'm more focused on communicating the values and the founder mentality being the owner mindset, the insurgency and the frontline obsession. And basically, I don't know how many of you have seen the old Gladiator movie, You Want to be Maximus, in the opening scene, where he's kind of with his staff, and then he's running front line and attacking the enemy.

7:43And this is also why I would say the most important learning that we made is that don't be intimidated by your IPO. A lot of people say, okay, now we have an IPO, and we need to kind of become compliant, we need to become corporate. The thing is that when we talk to investors, it might be in the US, in the UK or France or Germany, they invest in the startup that you made. They invest in the mindset that you have created. And they're not investing in compliance, IR or stuff like that. That's just table stakes and license to operate, but it doesn't give you any competitive advantage. So I know it's easier to say this when you are the founding CEO because you can't get away with saying stupid stuff that might not be compliant.

8:35But still, I think that's key to maintain that and being a bit non-compliant. And I think that if you think that the IPO will make you corporate, then it will. But if you think that you will not change and focus on the things that matter, then your company's immune system will start fighting bureaucracy and not innovation and change. I've got the stop sign, so nine minutes. Thank you.