Despite Donald Trump's winning campaign, it'd be safe to say few Silicon Valley CEOs would publicly suggest comparing their companies with the President-elect. But on Nov. 8, Wish CEO Peter Szulczewski found the perfect analogy for his e-commerce startup's silent success.
Speaking onstage at the Code Commerce event at San Francisco's Westfield Mall on Tuesday night, Szulczewski said that Wish, a mobile marketplace that sells cheap wares, has grown by focusing on customers outside of cities and Silicon Valley, a demographic that heavily favored Trump in the election. Expanding on a blog post he wrote last week, he noted that few venture capitalists had been able to understand his company, because they lacked relationships with the so-called "invisible half" of the country that shop on his service.
"The investor class in Silicon Valley said, 'I don't use [Wish.] I don't know anyone that would shop on Wish. I don't think anyone would shop on Wish,'" said Szulczewski. "During the election this year, you basically heard the same thing as well... 'I don't support Trump. I don't know anyone that would support Trump. Therefore, no one supports Trump.'"
While some venture capitalists wrote off Wish with that thinking, the company has thrived, focusing on consumers who prioritize price over convenience and quality when buying everything from cheap jewelry to refurbished electronics. Confirming an earlier report from Recode, Szulczewski said that the San Francisco-based startup recently closed a $500 million round of investment and has more than $1 billion in cash reserves following the deal.
That money will go toward improving shipping times, a major pain point in Wish's business model. Users have become accustomed to paying extremely cheap prices for goods that may take weeks to arrive from a manufacturer in China. To combat this, Szulczewski said the company is investing in more warehouses around the world so that third-party vendors can house their goods closer to customers and cut shipping times. Wish also launched Wish Express earlier this year, a service that allows customers to guarantee their order arrives in six days or less.
Calling shipping issues a "valid criticism," Wish's CEO only said that his service has worked thus far because "prices are so inexpensive."
Inexpensive has made for good business. While Szulczewski dodged questions on the specifics of revenue, he suggested that the company was on track to double the amount of goods sold this year, and over the next 12 months could record $4 billion in gross merchandise volume. Wish sells 2 million items a day, with the average customer buying 16 items a year, said Szulczewski.
Wish allows users to buy items--from underwear to smartphones--from a feed of products that it arranges in bulletin board-like fashion on a web page or through its mobile app. The company's software learns about user preferences from browsing habits and past purchases and can build curated shopping experiences for each individual. The company takes a 15% cut of every sale.
With Wish now worth more than $4.5 billion according to one person familiar with the company who spoke with FORBES, Szulczewski seemed disinterested in selling. He said the company's only firm acquisition offer came in 2012, far before it had any traction. And while he's had conversations with the likes of Walmart CEO Doug McMillon, Wish's CEO doesn't see the world's largest retailer making another significant bet following its $3.3 billion acquisition of Jet.
Also, Wish, flush with cash, is in no hurry to find an exit.
"At the end of the day I go to sleep with $1 billion in the bank and I don't feel bad about it," said Szulczewski.
