Growing a start-up to a full scale business involves strategy, risk and guts. Over the last 24 months it has been very exciting to see a new crop of e-commerce sites evolve from the original foundations laid out by Amazon. Gilt Groupe was one of the first to hit their stride in the US along with competitor Vente-Prive in Europe, both selling designer and top named brands at flash sale prices. Their expansion strategy was speed - grab as many verticals and geographies as possible, be everything to the end user. As time has passed, we saw Gilt open but start scaling back their "Gilt City" segment which provided deals for city activities. Growing pains involve trying new things, while some work, others need rehashing.
The story of Fab, recently featured in the WSJ is one that differs from Gilt - Fab has chosen a path to profitability rather than racing away from their focus. Growing their revenues over 6x from last year to $140m in 2012, the largest geography in their stable is the US and soon it is expected to be profitable. Maybe a lesson from the dot-com era, a CEO's intuition or the demands of investors, profitability cannot be discounted in today's tech environment. There is a certain discipline taken by Fab and, in the longer term, having positive cashflow will create a steady platform for deliberate growth in a timely fashion.