Mark Pearson: How I made £1m with discount vouchers
Fed up with working long hours for little pay as a chef, Mark Pearson set up discount website MyVoucher Codes from his bedroom. It was soon raking in sales of £9m a year.
Brought up in Mosley, Liverpool, Pearson came to London as a trainee chef under Gordon Ramsay at Claridges. He went on to run a gastropub aged 21. But, fed up with "working long hours for little pay", he struck out on his own in 2004 this time as a florist. "I bought a machine that wrote personalised messages on rose petals," he says. He then introduced online digital vouchers that allowed customers to get discounts.
He rapidly realised that this was his "cheapest and best advertising platform". Further research revealed that discount vouchers were big business in the US, where several well-established companies were giving them away online. "I thought there was perfect opportunity here. It was a no-brainer: a free-to-use discounts website where you save money." And "boy did it take off".
Hiring a company in India to build a "very amateurish" website for £300, Pearson launched the business from his bedroom in Wallington, south London, in November 2006. He realised that social networking sites such as MySpace and Friends Reunited were taking off, so he advertised his service on them. "We obviously caught on to the viralness and the socialness of the internet. A few people told a few more people and it snowballed. If you've got a good product and a good service it works wonders, because people will do the work for you." By Christmas that year, sales of onsite advertising were pulling in £1,000 a day.
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Then online retailer Play.com contacted him by email. "They said: 'We notice you've got a website we've got some great offers and discounts. Would you publish them and in return we'll give you commission?'." That's when Pearson realised he could make more money by partnering up with these companies, rather than putting "flashy banners" on other websites. Computer group Dell signed up too, and soon Pearson was contacting others. "Every time someone clicked and purchased something via my discounts website, I would get a small commission off the purchase they made."
It turned out to be a good business model. By the end of 2007, sales hit £1m. Growth was rapid, rising to £3m in 2008 and £9m in the year to July, as the company launched in France, Germany and the US. It now works alongside 3,500 businesses on both sides of the Atlantic, as the recession fuels enthusiasm for thrift among shoppers. "I think the recession has changed people's outlook," he says. British consumers in particular used to be a little embarrassed to save money, but not anymore. "Now it's different. They're now proud and savvy when it comes to saving money. They'll say: 'Look, I've got this two-for-one voucher why are you paying full price?' We're in a whole new position now, and I don't think it's going to go back."
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Jody studied at the University of Limerick and was a senior writer for MoneyWeek. Jody is experienced in interviewing, for example digging into the lives of an ex-M15 agent and quirky business owners who have made millions. Jody’s other areas of expertise include advice on funds, stocks and house prices.
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