5 Tips to Break Through in E-Commerce from Henrik Muller-Hansen

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Henrik Muller-Hansen Gelato

Founder and CEO of Gelato Henrik Muller-Hansen is an experienced entrepreneur. He has managed a variety of teams that have “created high growth in competitive industries,” “developed very strong cost control,” “provided the market with a compelling combination of price & quality.”

For his work at Gelato, Henrik Muller-Hansen also relies on his experience in managing teams that have “built virtual value chains, leveraging on existing infrastructures,” and “enabling capital light operations.”

At Gelato, Henrik Muller-Hansen leads a company with a mission to “build the world’s most intelligent print cloud and make printing accessible for people, organisations and companies across the world.” Currently, they have developed “a global print engine integrated with the print ecosystem’s key players, e.g. Adobe, Dropbox, Google Drive and HP.”

Henrik Muller-Hansen and Gelato also deliver their products and solutions to more than 40 countries. With a single print cloud, they can reach nearly one billion people.

Aside from Gelato, Henrik Muller-Hansen has also founded and led several different companies. One of these is Source Logistic. This company “offers end-to-end solutions for online print services under our partners’ own brands, handling all steps from design to distribution to their end customers.”

Likewise, prior to Gelato, Henrik Muller-Hansen founded and led Optimalprint. The company allows users to “create, administrate and order print material over the internet.”

Check out more interviews with print magnates here.

I didn’t know anything about the print industry, but I saw the potential. Henrik Muller-Hansen, Gelato

Jerome Knyszewski: Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started? What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?

Henrik Muller-Hansen: In my previous role as CEO of a $400 million Telecom named Tele2 Norway, I learned that it’s possible to build a successful global company without owning any physical assets or infrastructure. By utilizing software and technology one can effectively connect the owner of infrastructure with the end-customers.

I also learned that staying close to the trends outside of your immediate environment is really important as an entrepreneur, although it might be easier and more comfortable to not try to connect to the more stressful, fast-paced and competitive outside world with its many amazing ideas, people and companies.

After resigning as the CEO of Tele2 Norway I bought a ton of business magazines and flew to Portugal to read them all. I came across an article about an industry I thought was dying which, to my surprise, was exploding — growing $10B per year. That industry was digital printing.

I didn’t know anything about the print industry, but I saw the potential. The main opportunity? Big print runs of static content were growing into smaller and smaller print runs of personalized content. Static content was going personal. Centralized production operations that shipped to the rest of the world were going to lose out to the rise in local, eco-friendly production.

I knew how to build tech teams and travel like the Nomad people (who don’t own assets either) and so the Gelato journey began.

Jerome Knyszewski: Can you tell us a story about the hard times that you faced when you first started your journey? Did you ever consider giving up? Where did you get the drive to continue even though things were so hard?

Henrik Muller-Hansen: I often compare building a company with climbing Mount Everest or performing a similarly difficult journey. You need to be 110% passionate about the goal and see that vision clearly in your head when the temperature drops to minus 50°C and you are tired, hungry and dehydrated. At the same time, you dream about that peak and the beautiful view from the summit. That, to me, is the best way of describing the building of a company — it is filled with polar-opposites, beautiful and painful at the same time.

One of the most difficult times for me personally was right in the beginning when I had sold everything that we as a family owned in order to fund the beginning of this journey. Every morning I woke up looking at two bank accounts — first our own personal account and then the company’s. Realizing that you have just a few weeks before you have absolutely no money left is an incredibly difficult thing to face.

At the time I was guided by Guy Kawasaki’s advice to get your product shipped. What he means is that when you build a company from scratch, you need to get the products out to the market. You cannot simply sit and perfect them in your office. The product needs to be shipped and touched by your customers. You need to quickly generate revenue and — perhaps more importantly — get your customers’ feedback.

Finding the way forward — from an idea to the first dollar earned from a real customer paying for your product — was the most challenging time for me.

I never once thought about giving up. Perhaps, because giving up would have meant that everything I invested, including all of my family’s savings, would be gone. Giving up has never in my life been an option. Another reason I have never given up is because I firmly believe that connecting all these production hubs that stand idle across our planet makes a lot of sense. It is such a “no brainer” because producing locally — instead of centrally and then shipping all across the world — is smarter, faster, and greener. Who doesn’t want that?

The belief that businesses need to be hyper-global is shifting increasingly towards another belief: that business should be local.

Jerome Knyszewski: So, how are things going today? How did your grit and resilience lead to your eventual success?

Henrik Muller-Hansen: First of all, I don’t really agree that it is about my grit and my resilience. Sure, it has been a component along the journey but not the reason for our success. I think the main reason for our success is a very clear and meaningful purpose and mission. That, in turn, has attracted some amazing individuals. When you combine a lot of great people from all over the world who are united by the belief in a single vision, you get a team that is capable of so much more than the individual. For me it’s the team, the whole rather than the sum of the parts, that is the main reason for our success.

Today, our original idea has never been more relevant and important. The belief that businesses need to be hyper-global is shifting increasingly towards another belief: that business should be local. The pandemic has further emphasized the importance of localizing production as well as distribution. Borders have been closed, and value chains disrupted and destroyed. In parallel to this, new business opportunities have emerged thanks to technology and platforms like Shopify, Etsy, Amazon Web services, Stripe and, of course, Gelato.

Gelato empowers entrepreneurs and business owners to reach customers worldwide with their products overnight. In Q4 2020 we are generating roughly $40M in revenue with a positive cash flow of USD 4 million.

Henrik Muller-Hansen: Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?

Striving for perfection is not what is going to make you win this game, speed is. So yes — we have made lots of mistakes, and we continue to make them. Obviously, some are more avoidable than others, and much more amusing to look back on now that 14 years have passed. The time we produced our first calendars for example it had 56 weeks in the year rather than 52. I was contacted by many angry customers including one that had booked a trip to Spain on dates and weeks that didn’t actually exist! As you can imagine, that ended up costing us quite a lot more than just refunding the cost of the calendar.

Remove emotions and embrace data.

Jerome Knyszewski: Can you share a few examples of tools or software that you think can dramatically empower emerging eCommerce brands to be more effective and more successful?

Henrik Muller-Hansen: First of all, software (per definition) can be infinitely distributed with zero marginal cost. In other words, the distribution power coupled with the velocity of new software tools makes any recommendation of mine outdated before this article is published.

However, the most important recommendation I can give in terms of software is to find a framework that helps you prioritize and focus. Since focusing is about saying ‘no,’ you need software to power that framework — a software that makes sharing your focus easy within your team.

To guide our operations and priorities we use a framework called OKRs — Objectives and Key Results. It was originally developed by the late Andy Grove and refined by John Doerr. Deploy OKRs and find the software to support each and every team member.

Jerome Knyszewski: As you know, “conversion” means to convert a visit into a sale. In your experience what are the best strategies an eCommerce business should use to increase conversion rates?

Henrik Muller-Hansen: First of all, I do not believe there is a universal formula for increasing conversion rates. However, if you compound and find an average I think there are some common features:

  1. A strong value proposition — search results provide instant transparency compared to competition. At least in my experience, you must relate to price leadership or master brand uniqueness.
  2. Quick loading time with easy navigation — new visitors to your site will give you an average of a few seconds before they make up their mind to stay or exit.
  3. Today, I would start with mobile and focus on desktop after.
  4. Consistent trust signals — there are probably many companies delivering a similar product to yours so you need to radiate trust.
  5. Remove emotions and embrace data.

    Today, every brand is less durable. Henrik Muller-Hansen

Jerome Knyszewski: Of course, the main way to increase conversion rates is to create a trusted and beloved brand. Can you share a few ways that an eCommerce business can earn a reputation as a trusted and beloved brand?

Henrik Muller-Hansen: Historically, brands have slowly risen and fallen in prominence, but now we operate under completely different conditions. If you are an entrepreneur reading this, these changes are likely playing to your advantage. Today, every brand is less durable. Consumer habits have digitized, and new business models can quickly blindside traditional brands.

To build Gelato’s online brand and business I think about 4 dimensions — the so-called “MACE” framework:

  1. Mastery — Give customers non-transferrable rewards for using your products and engaging with your content. Gelato publicly displays our largest customers.
  2. Accessibility — Give easy access, i.e. no hurdles, to get started. You can activate Gelato’s API service without paying anything. It is a “pay-as-you-go” model with no commitments.
  3. Cadence — Constantly create news and content around your brand. Gelato constantly releases new features and products which are made public in newsletters and forums.
  4. Ensnarement — Make your brand as sticky as possible by building in switching costs and creating network effects. Gelato is so unique because of our global network that once you have started with local production and delivery it becomes very difficult to switch.

Jerome Knyszewski: Ok super. Here is the main question of our interview. Based on your experience and success, what are the five most important things one should know in order to create a very successful e-commerce business? Please share a story or an example for each.

Henrik Muller-Hansen:

  1. Starting a business is not easy, and scaling it is even harder. But the strongest fuel is a personal connection to what you’re doing. Identify a problem that you truly feel has to be solved.
  2. Don’t travel alone! No matter how much you trust your team, you can never be completely honest about your fears, nor fully share the burden of responsibility when things get difficult. Remember that better outcomes are driven through healthy debate.
  3. Determine how you will improve peoples’ lives. Consumers have more power and choice than ever before, and they’re going to choose and stick with the companies who are clearly on their side. How will you make their lives easier, more pleasant and more meaningful?
  4. Jump — and jump totally! It doesn’t work to just “dip” your toe in the water. You might want to keep your day job until you get your business off the ground, but it won’t work that way. You cannot do this “on the side.”
  5. Do not take yourself too seriously. You will make plenty of mistakes so do not try to avoid them — seek them and make sure you learn from them!

Jerome Knyszewski: How can our readers further follow you online?

Henrik Muller-Hansen: You can follow myself and Gelato on LinkedIn, and on our website and blog here.

Jerome Knyszewski: This was very inspiring. Thank you so much for the time you spent with this!

 

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