To say that Jim Rose has been busy over the past six months would
be like saying Bill Gates’ bank balance is in credit.
Rose was brought on board in May to head the two-year-old QXL.com - the
name was chosen to sound like ’Quicksell’ - which was already operating
in the UK, France and Germany, and was about to float on the stock
market.
The former Financial Times journalist, Tim Jackson, had set it up in
1997 with just over pounds 100,000. The operation started with two arms
- a business-to-consumer and a consumer-to-consumer online auction
house, not unlike the US outfit, eBay.
Despite being a financial whizz, Jackson knew he was not a manager and
that he couldn’t float without a chief executive officer. Enter
Rose.
Rose overhauled the operation’s infrastructure, using skills he’d
gleaned as a Deloitte and Touche management consultant. He brought in
new financial accounting systems; the front end of the site changed as
the two separate sites merged into one. A new internet service provider
was brought in; hosting was moved from the US to Docklands-based
Telecities.
Rose had picked up his internet know-how while setting up the
web-selling operation for the bookseller, Blackwells. He moved QXL.com
from its loft in Notting Hill to Hammersmith, where the staff - now
numbering 300 - could work in a proper business environment.
Guiding the company towards the initial public offering (IPO) was a real
test of Rose’s mettle. Freeserve had just gone to market and, just as
quickly, seen its shares go into freefall. The City became edgy and the
business pages warned against buying net stocks. Two months before the
sale, a story appeared in the press saying that QXL would be valued at
between pounds 750 million and pounds 1 billion - a world away from its
actual float value of pounds 250 million.
Rose says he has no idea where the initial story had come from; pounds
250 million was absolutely the value they had all expected. He says he
couldn’t ask the paper to do a correction because he would have had to
say what the real worth was, and he wasn’t in a position to do so. When
QXL came to market at a third of the price, everyone said it had slashed
its value.
But in the run-up to flotation, in a jittery climate, was he
nervous?
’I was getting calls asking whether I would pull the IPO. The thought
never crossed our minds. A lot of our investors are institutional. They
don’t just sell when they read something bad. They knew our business
model.
We weren’t pleased that Freeserve was tanking, but all that stuff didn’t
bother me.’
Much of the money raised at the IPO will go towards marketing QXL.com to
mainstream punters. Up to pounds 7 million will be spent in the UK over
the next year to build brand awareness through TV, radio, posters and
sales promotions. Pushing QXL.com’s travel offering will play a large
part.
As for growth, the organisation’s sights are fixed firmly on Europe.
Rose says: ’Statistics say that in 2002/3 Europe will converge with the
US in terms of web use so Europe’s a much bigger market.’
The next launch market will be Spain, and after Europe is conquered
QXL.com will look to the Middle East, Canada and even the US, where eBay
dominates.
Rose doesn’t feel threatened by eBay: ’It should have been here nine
months ago. When it launched it had US pricing and that didn’t go down
well with the locals. Consumers like our mix and range.’
For now Rose, 38, is fiddling around with all sorts of ventures. In a
deal sorted out in only four weeks, QXL conducted an auction of boxing
memorabilia for Sky Sports. There is a lot more potential for digital
TV, and the company was chosen to auction off bits of Wembley Stadium in
a sale that could raise as much as pounds 20 million.
What does the future hold for Rose, who has 3.3 million share options
which invest at 25 per cent a year over four years, and who runs an
operation growing at 100 per cent a quarter?
’I love it,’ he enthuses. ’Where else can you drive the market and
accelerate your opportunities? It’s not the muddy dollar calling me. I
will be happy as long as I can continue to do exciting, creative things.
I’ve been fortunate.’
THE ROSE FILE
1979: Northern Illinois University, BA in business management
1983: Northwestern University, MBA from Kellogg School of Management
1986: Deloitte and Touche, management consultant
1993: Dunn and Bradstreet/ACNielsen, UK & Ireland, managing director
1996: Blackwell Information, Services, chief executive officer
1998: United Information Group, chief executive officer.
