647: I Started a Jewelry Brand With $25K and the WRONG Business Model | Noura Sakkijha

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0:39Just head to OmniSend.com forward slash founder without the E to get started. All right, now let's jump back into the show. What happens when a third generation jeweler realizes the entire fine jewelry industry is fundamentally broken, built on the outdated idea that men buy diamonds for women, not that women buy the damn diamonds themselves. Today's guest, Nora Sakija, founder and CEO of Majewerri. In 2013, she launched Majewerri with a radical mission, create fine jewelry for women to buy for themselves. What started as a crowdsourcing platform quickly pivoted into something much bigger, And over 11 years, Majuri has sold 6.5 million pieces of jewelry and is expanding now globally.

1:22And in this conversation, you're going to discover why she completely pivoted the business model after just one year when the crowdsourcing platform failed. The brutal 2021 lesson about hiring ahead of growth and why she now refuses to hire until the team feels real pain and why she prioritizes culture fit over skills every single time because a bad culture hire creates noise that kills momentum. This is an honest conversation about building a globally recognized jewelry brand while challenging an industry that's been doing things the same way for generations.

1:57Hear the stories, learn the proven methods and accelerate your growth and future through entrepreneurship. Welcome to the Founder Podcast with Nathan Chan. you're a third generation jeweler who worked in industrial engineering at a bank what was the moment in 2013 that made you realize that traditional jewelry and that whole model was fundamentally broken and needed to be fixed um as someone who grew up in jewelry i had the privilege of seeing things from the inside um and i loved so much about it i loved you know, handcrafting. I love the idea that jewelry can stay forever. But to be honest, I didn't necessarily love how traditional fine jewelry is.

2:45And by that, what I mean is fine jewelry, we're always conditioned to think it's, you know, exclusive from a price point standpoint. It's also always marketed as a gift and traditional gifting to men buying for women, which I think is a really traditional way of thinking of things and doesn't necessarily mesh well with how women live their lives right now. So I decided to take a detour. As you said, I studied engineering, I moved to Canada, I worked at consulting. And that's when I started to make my own disposable income. And when I wanted to buy jewelry for myself, I didn't find that there's a brand that I connect with.

3:20And it was the aha moment, because that's when the DTC also was starting. And that was the moment when I realized that, you know, I want to create a brand for women to buy jewelry for themselves or as we say at Majuri, buy yourself the damn diamond. And the concept is very intuitive, but we really had to rethink a lot in terms of design and context and the brand positioning. So that was the start of it. Yeah. So talk me through setting up. You're based in Canada, set up with Shopify, I assume, right? Talk me through your first order. Like how did that go? We actually didn't start with Shopify.

3:59We had a very complicated tech stack because we started the business as a crowdsourcing platform in 2013. And that required its own technology. And anyway, it was a big, big thing. So we started as a crowdsourcing platform and operated the business for about a year, after which we decided to completely pivot into Mejuri, what it is today. And so we carried that legacy technology and our tech team hated it for a long time. And we just pre-platformed last year. But to answer your question, to be honest, I cannot remember the first sale, which is a little bit sad. but I can remember the first time that I walked down the street and I saw a woman wearing jewelry that somebody I didn't know and it was a moment that was amazing it's like somebody I don't know is wearing majority and it felt really really amazing but that was after the pivot.

4:56So talk me through that pivot and that first year and how did you know that it wasn't working You had it. It sounds like you would have had an engineering team. What were the costs there? Like how much were you in the business? Like how much you put in to get it all going to begin with? Like talk us through that part. Yeah. So I started the business with my partner while I was working full time in engineering. So the beginning was pretty tough. And the whole idea of the crowdsourcing was we're going to cultivate the creativity from designers around the world because I truly believe in design and aesthetics.

5:31And because we know jewelry, we're going to produce the jewelry at high quality. And so we started that model. We got a lot of demand from designers. But when it came to customers, we didn't get a lot of sales. And that's the moment that you realize there's no revenue, there's no product market fit. And that was, frankly, the, I would say, a lesson that I learned the hard way is the importance of building a brand is about having a specific POV, that's what's missing in the market, and staying consistent with it. And I would say that's why I'm overprotective of the brand right now, because the customer doesn't just want to buy a product.

6:10They want to belong in a universe that feels amazing. And so we made that pivot in 2015. But to talk about the costs, the way that we started the business is we won a grant, and it was $25 ,000 Canadian dollars. It was not much. And that's when we hired our first engineer to start the text tag. And obviously me and my partner were not paid. And so that's how we started the business. And then we started to get grants here and there to pour into the business. Yeah, there you go. My partner, she's doing her PhD. She's a neurologist and she's, you know, had this really groundbreaking discovery as part of her PhD and she's really excited.

6:51And she's like, oh, she's like, I might be able to get a grant or something along those lines. I said, because you can get funding and stuff. It's like, oh, it's so much work. And I'm like, these days you could get AI to do it. Like filling out and like applying for grants, it's like. It's a lot of work. Yes. Some people hire people to write the applications for them. It's like a business. Yeah. Okay. So how many grants did you get? We got two to three and they were small checks here and there. And then we started to raise capital, I would say. Like serious seed round in 2016. And that's when we got our first million in capital.

7:34Got you. Okay. So you relaunched in 2015. Talk me, before we go to that and talk about the business model of Majuri as it is now, I just want to go back to like, because there would be some people feeling this, where they're not getting sales. It's not working. You're working really hard. After work, before work, sleepless nights or not much sleep. And you have that question, oh my God, like, am I wasting my time? Yeah. You would have been going through that. You obviously probably putting, I don't know how much of your own money, tens of thousands of dollars because building software back then is expensive.

8:20It is expensive. Yeah. Yeah. You've still got your job, which is great, but talk me through that. Like, how did you know you had to make a fundamental shift? What was that turning point? What was that realization? And what would you say to founders? It was by far one of the toughest periods, I would say. There's like, things don't get easier as the business scales. It's just you get more experience and it gets different. But that period, because I would say most founders are high achievers and they associate themselves so much with what they do. And in the beginning, when you're trying and failing, trying and failing, you can imagine the mental pressure that puts on you.

8:55And I remember it was one of my lowest points in my life. It was the period where I'm trying working every single day, but it's not working. One of the things that worked super well for me is at that point, we got into 500 startups. I'm not sure if you're familiar with it, but it's an accelerator in San Francisco. And so I decided to go with my other chief creative officer at the time. And we went together and I went into that room. And it's a bunch of amazing people who are so smart, who are doing things, and they're so comfortable with failure. And that gave me a massive boost. It's like, it's really, really important to treat failure as a data point.

9:36And it's really important to distance yourself from it because it's going to be part of the journey. And culturally, I come from a culture where failure is a little bit shameful. And so it took me a little bit of time to rewire my brain and think, this is not me. This is just something I'm trying. And that gives you a lot of power. But the point when we decided to pivot was when I got a call before 500 Startups is to essentially go into another accelerator in Montreal. And at that point, we decided now we have a little bit of funding. We know it's not working. Now is the only opportunity in order for us to pivot into a brand and pursue this the way that I dream for it to be done.

10:16because typical typical like startup accelerators they they tend to be more tech focused and you kind of pivoted from tech to direct to consumer which is is a totally different business now i've done both i've done kind of more tech side software or all that but then also um d2c i find d2c funner because you can touch it and feel the product but i yeah what i i love i love product creation is probably my favorite thing in the business and then you also talk to the customers consistently it's awesome. So how did you come up with the version of Majuri that it is now? Talk me through that. Talk me through how you found your manufacturer, source product, all of that stuff.

10:59Yeah. When we decided to launch Majuri as a brand and come out of the crowdsourcing platform, it became an, the first person that we brought on board was a creative person who worked alongside me. She's one of the co-founders. She's worked alongside me for 10 years. So we were partners throughout the journey. And so we started to create the brand universe. And what is the aspiration? We started to create product design. But I remember distinctly, obviously, at that point, we didn't have a big manufacturing network. So I got introduced to manufacturers in Toronto, kind of in our backyard. And I literally used to take every single order, every single product from one room to another to make sure that everything gets done on time.

11:41It was crazy. But I remember we had at that point launched what I would say your essential 14 karat and diamond products. And I remember the first moment I saw them, I felt like this is it. This is exactly what I would buy. This is exactly what my friends would buy. And I felt like my heart skipped a beat, to be honest with you, looking at the product. And at that moment, I realized we had something. And from then, we started to build the business. But obviously, you have to scale manufacturing. And everything starts with an introduction. We got introduced to one. And that manufacturer started to work with us.

12:16And our capacity increased. And when it increases, our demand increased, I should say. When it increases, then you have a lot more power to go and talk to manufacturers and onboard new ones. And so one door opens the other, essentially. And that's how it started. It started with me literally meeting with manufacturers in Toronto, taking the product, buying the gemstones, buying the diamonds and making it happen to then scaling it into manufacturing partners overseas. At what stage, because with jewelry businesses, it's relatively low MOQ, especially if you can make the product yourself by hand or you have that skill set.

12:58And we have, you know, a lot of people in our community that have like, you know, jewelry businesses where they, you know, go to art and craft markets, et cetera, et cetera. Tell me how you drove growth in the early days. because I know you delayed paid marketing, but I want to talk about those early years. What really opened things up to drive demand? Because there are a lot of jewelry brands or D2C brands in general that they kind of stay somewhat, you know,$100 ,000,$200 ,000. Like they don't get to the level of scale that you guys have, like 6.5 million pieces of jewelry since 2015. So the past 10 years, like that's a lot of product.

13:39That's a lot of volume. Yeah, it's a great question. I, you know, in the in the one of the things that I always tell people. So when I raised our seed funding, it was it was the hardest round that I had to raise for, even though I have raised tens of millions after. Because at that point, I was trying to convince people to invest in a jewelry business when everybody was pitching AI. And you can imagine who's you know, I had to work really hard for people to listen to me and to see the opportunity. so because I worked so hard for the first million I think it's actually one of the best things that happened to us because when you have constraints and you realize I don't have access to a lot of capital so I really have to hone in on the right metrics and do the right things and at that point I started to decipher what is a vanity metric like you know in the beginning people say how how many employees do you have or how much money did you raise or which articles were you part of All of that doesn't matter.

14:33At the end of the day, do you have customers who are coming to your business? And are they repeating? Are they coming back? Those are the most important things in the beginning. And so that healthy constraint really sharpened how I think of the business. And so what activities were you doing in the early days to drive sales? At the early days, some of the things that we focused on because it was primarily organic growth, email marketing was really important. So obviously brand partnerships. So being where the customer is, doing sweeps together, growing our email list was one of the KPIs that we were working on and obviously using that to then create campaigns.

15:13The second thing that was worked in our favor is at the time Instagram was really scaling. And so we were selling fine jewelry, beautiful pieces. And so we were able to work with influencers on Instagram and have them contextualize the jewelry. And that was a big, big propeller for us because we were able to create a community of influencers who truly love the brand, put the products on. They have huge engagements with their community. And that was a big propeller for us. And I always say this to entrepreneurs when they ask me. You always have to drive steps every single day in different disciplines in order for you to create momentum.

15:52So it wasn't one thing or the other. It was Instagram. It was Facebook. It was email marketing, truly trying to be where the customer is. Yeah. Okay. So you did paid marketing a lot later. So it sounds like a big traffic channel for you was organic Instagram. I remember those days, early Instagram days for founder was massive too. I remember I first kind of discovered Instagram in 2015. 15. I remember feeling late to the game. Kind of crazy. Probably same for you, right? Like you just launched your business, so you feel like late to the game. And it was the Wild West, really. Like it was the Wild West.

16:37Like influencer marketing was still in its infancy. But if you did it and did it well, you did very, very, very well. And the algorithm was really friendly at the time. and influencers were, to your point, were everywhere. And there were influencers, I remember, who are so in touch with their community. That was amazing to see how much their community would listen to them. And so, yeah, we were lucky to find these partnerships. Now, when did you start the drop model? Because that was something that was really pioneered back when it wasn't that much of a thing, but now it's quite popular. but it's a very, very powerful part of your model.

17:22Like your wait list often exceeds 70 ,000 to 100 ,000 people. Like from a brand, from a marketing perspective, who wouldn't want that? That's like a brand owner's dream. Yeah. The drop model was always from the beginning of the business. And a funny story because when you look back as a founder about the moments that you actually made some big decisions, Sometimes it's so maybe a little bit naive because you don't know where you're going to end up. But it was essentially me and our creative officer. And I'm like, you know, I think newness is really important for us. I think we want to make sure that we have freshness in our products.

18:03And so why don't we start this drop model next week? And she's like, OK, let's start it next week. And that was in 2016. And we continue with the drop model. And the drop model is essentially what it means is every single week we're introducing that new product. It doesn't mean that we're introducing a lot more than other jewelry brands. It just means that we're not necessarily always introducing massive, cohesive collections. We're introducing two drops, two pieces here to 10 pieces there. And what was important for us is that this drove a lot of loyalty in the brand. One of the things we wanted to change is the idea that jewelry is something that you buy once a year.

18:41We wanted to make sure that this is something that you can buy, you can stack, you can create and express yourself. And so now 50 % of our monthly revenue is from customers that we've acquired. And I do attribute some of this to the drop model. We're obviously now much bigger and we're changing what that looks like for us and what the right frequency looks like. But it was certainly a big engine for us to engage our community and to keep them engaged with us. so first year revenue would you be able to share like kind of just to give people a gauge of how effective like and how much that perfect storm was there first year revenue it was sub a million i think first year if i go back in time and then eventually you raised multiple rounds series a seed seed series a series b yeah what metrics did you have to track was it still mainly repeat purchase and just growth to raise?

19:37Yeah, so seed is very different. Seed where essentially you're, essentially the investors are looking at product market fit. Do you have sales? Do you have a little bit of repeat? Who are the founders? Are they in it to win it? That sort of thing. Then you raise your series A and things get a little bit more sophisticated. And then you have KPIs across the board, all the way from CAC to LTV to revenue. And series B, you have to get a lot more sophisticated with forecasting and meeting these forecasts. So I feel like it keeps getting obviously more sophisticated as you grow the business. And then it's essentially the same over time.

20:16And are you able to scale? What is brand awareness? So it just evolves, but the fundamentals are the fundamentals. I find the most important things is like your revenue, how your customers feel about you and your repeat rate are some of the most important things. So at what point did you realize this can be a big business and you're like, you know what, I'm going to go for it. I'm going to raise a significant amount of money to fuel the growth here because I see the sub multi nine figure billion dollar plus opportunity. I had started this wanting to make it a massive business. And I remember my co-founders make fun of me because we literally had nothing.

20:56And I had like this sticker on the wall that says the number one global jewelry brand for the next generation. we literally had 25 000 canadian dollars in the bank it barely were working website and that was the vision so i knew from the beginning that this is a massive market i knew from the beginning that there is a white space that i could see super clearly and i wanted to go behind and that was why from the beginning i wanted to raise capital in order for us to accelerate our growth but obviously the moment when i started to feel like when i walk in the street and i see people who are wearing the jewelry and I don't know them when I hear positive feedback about the brand like I started to feel people are coming to me and telling me stories about why they bought their jewelry which is exactly what we set out to do for example people would tell me you know I bought this because I ended a bad relationship I bought this because I got promoted and that's exactly what we set out to do we're building something that is beyond jewelry we're building essentially a way for women to celebrate their own journeys and their own minor stones is what we call them and that felt like this is this this can be really really big and really exciting yeah i can really respect um the point of view because you said to me before um if you're going to do something you really needed to build the brand and you really more than ever even to this day you are so passionate about the brand and the point of view yeah what advice would you have to founders coming into somewhat of a red ocean because if you look at if you look at your industry yeah it did not look like a blue ocean for many but you guys over time have carved out a really strong differentiator point of view different model like so what what would you say to founders when it comes to like looking at the competition looking at their marketplace and landscape and going, oh, wow, this is, while it is a large TAM or a big market, it is so competitive.

23:01How can I stand out? Yeah, I think it's really important to have a very specific point of view and really identify where you can capture. Like you cannot go to an overly saturated market with the same point of view as somebody else. And for us, it was, I had to study the market. By study means like read analyses of the jewelry industry to understand where we want to be. it's a massive industry. It's over$200 billion, and only 20 % of it is branded. Whereas when you compare it with watches, 60 % of watches is branded. What that told me is there's a ton of fragmentation in fine jewelry, and therefore an opportunity for a brand to come and combine market share.

23:44And so I would say to founders to look at these anecdotes on what is it that is missing in the industry? And what is the consumer looking for? And when you define that, Have a very, very specific point of view. And honestly, use it as your guiding star. What are we and what are we not? Because it's important to know what you're not as much as it's important to be this is who we are. And stay consistent. Consistency is the thing that builds reputation. And this is the recipe I would follow. Now, as you start to get scale on the DTC side, you didn't stop there. You set up an omni-channel approach.

24:26which is actually quite brilliant if I think back in those times. You set up 50-plus stores starting with a showroom in 2017. And now, back then, it was only really kind of Apple that did these kinds of things where they have your flagship stores where people can go try, feel the products. So I think it was a really smart, clever approach. Before now, you see a lot of brands do this. Now some brands do and pull back a little. So I'd love to hear kind of where that inspiration came from. You eventually did get into retail as well, but the stores were a big part of it, your own flagship store. So talk me through that.

25:12We were determined to be just online and we started to get a lot of feedback from our customers to want to come and touch and feel the jewelry. So what we did in the beginning is we actually invited them to our office. So during the holidays, you would walk into our office and you would see people trying jewelry and getting styled. And so we said, OK, what the heck? Why don't we just start a showroom? And our assumption was whoever is going to come to the showroom is going to be probably our customers who already buy from us. But what we realized is there's a lot of people who knew about Mejuri, but they didn't buy online because they wanted to touch and feel the jewelry.

25:48And they wanted to feel the experience of the brand. And so it soon became apparent to us that retail is a growth channel. It's a way for us to build awareness and a way for us to get connected to the customer. The conversion rate is high in retail stores. And obviously, sometimes your costs can be lower because you're not doing shipping. So also the numbers checked out. We opened our second store. The numbers continue to be 60 % of the people who are transacting in the stores are net new customers. So it became a growth channel for us. The AOV in the stores is higher than the AOV online. And so all of these things started to become really important for us that, you know, retail is part of the journey and building a next generation brand is also about accessibility and access to the brand.

26:34And you really do have to build for convenience. And you really also do have to build IRL experiences. There's a lot of noise online. There's a lot of overwhelming information online. And sometimes you just want to go and experience brands in real life, touch the product, get style, do the old fashioned way. And that feels amazing. And retail now is a big part of the business. It's about 50 % of our revenue. So what advice would you give to founders if they have traction, they're doing well on D2C because that's where founders usually tend to start. Retailers are tapping them on the shoulder. Some great ones.

27:13Yeah. margins nowhere near you know and like you obviously would have that's one of the reasons you raise my that's probably why you did your series a if i'm correct to to go with the store expansion yeah um to perhaps they don't want to raise and they just want to kind of grow slowly um and not with your level of scale what advice would you give to founders if they have retailers that are tapping them on the shoulder they you know it's a well-known retailer sounds like an amazing opportunity the margins aren't as strong they say they'll move product they'll give you shelf space but you've got to do a big po you've got you know you've got cash flow it'll come sometimes bring cash flow challenges how do you know when to kind of make that move we've never done a wholesale agreement because our margins are not built for wholesale um we've done concessions we do concessions which is a shop and shop where we essentially just opening in in nordstrom and Selfridges and Whole Trend Crew.

28:12And these are fantastic partnerships because you're tapping into that audience. But I would say, honestly, my take, and if you're building a brand and you have a product that is recognizable, wholesale can be a great way to access a lot of people. But if you're building a brand and you really want to control the experience of the customer, I would try to stay D2C because then you have access to the customer, especially in the early days when you want to learn, iterate, improve, customer feedback is everything. It's your North Star. And having access to these customers is really, really important.

28:48And it probably far outweighs having that access in the beginning. I think over time, when you feel like you're ready, your product is strong, it's recognizable, you don't need a lot of explanation around it. You can certainly go into the wholesale route, but that's not easy for jewelry. I don't think it's a different experience yep makes sense um when did you guys start doing uh direct mail because that's a cool one like that's old school that's a very very very cool old school channel who like it's a dying art form who doesn't like getting stuff in the mail you know founder started as a digital magazine then we did some print stuff and we used to send things in the mail to people just for fun it definitely makes a difference like like the quality of the relationship you have with your community or customer.