Rich-Lister takes on Trade Me
Mainfreight co-founder and Rich-Lister Neil Graham is taking on Trade Me with a new online auction and classified site, Wheedle.co.nz, that officially opens for business on Monday.
New Zealand cyberspace is littered with the train wrecks of online adventures that tried to take on Trade Me but which failed to crack the "chicken and egg" problem of attracting a critical mass of buyers and sellers.
But Graham said Wheedle had the management experience, technical expertise and "firepower" to become a long term success. His personal wealth was put at $65 million in NBR's 2011 Rich List.
Wheedle will launch a television, radio and online advertising campaign on Sunday to promote the site. Chief executive Carl Rees, one of three other shareholders in the business, would not disclose how much it would sink into the campaign, but said it had a multimillion dollar war-chest.
The venture had been two years in the making and will run off 40 servers in IBM's Auckland data centre, he said. "We are not doing anything by halves. Our infrastructure is huge to run this."
Rees said Wheedle had 10 staff in Christchurch and another 12 in India who had been developing software for the site and who would be involved in another undisclosed venture.
Wheedle is already online but its "official" launch on Monday will coincide with a 5.3 per cent hike in Trade Me's listing fees for general items, announced yesterday.
Graham said the online market was "currently wide open for some quality local competition" that could give New Zealanders a better service with better prices.
Wheedle aims to undercut Trade Me, charging a flat-rate $1 fee on items that sell through the site for more than $20. The fees will be waived and the site will be free to use until November 29.
It would focus on attracting established online businesses, including retailers, vehicle dealers, travel agents and recruitment agencies.
Rees said Wheedle was the first such website to be built from the ground-up in the smartphone age, and being locally-owned and operated would give it an advantage. "We don't have to report a large corporate base, nor do we have large shareholders demanding high returns on their investment."
He denied history proved taking on incumbent Trade Me would prove difficult. "Our momentum is going to be strong all the way and aggressive."