It’s not every day that a blokey developer quits his day job to sell custom-designed shoes online. In fact, such a move might seem like entrepreneurial madness, especially when you consider the sea of demanding Carrie Bradshaws such a business is likely to attract. Matthew da Silva talks to Mike Knapp, co-founder of Shoes of Prey, to see what made him quit Google and dip his toe into the foot business.

Near the elevators, by the poufs placed to show off the view north over the Sydney Harbour Bridge, between the minimalist reception desk and the kitchen that is designed solely for making espresso coffee and serving glasses of red wine, I meet Mike Knapp.

He apologises for making me climb a single flight of stairs to the mezzanine, where the Shoes of Prey office perches. His reticence indicates that although he welcomes the chance to talk about the company, he’s also a bit nervous.

Outside the wrap-around glass, to the east, looms the Coca-Cola sign, a Kings Cross icon that overlooks the imported car dealers of William Street.

Inside, occupying half-a-dozen unoccupied cubicles within space rented by advertising company The Campaign Palace, Shoes of Prey has all the hallmarks of a startup.

“We have some wedges there and they’ve got patent-leather and the wedge. And we can do that in cork or whatever,” says Knapp, gesturing over at neat rows of shoes lined up on top of the partitions like seashells on a child’s bookshelves.

“Often people will see those in stores and they’ll think, ‘Oh, I’d like to wear those but they’re too high for me.’ So they can come on our [website] and design a similar shoe – it’s not going to be the exact shoe – but a similar shoe and they could have a smaller heel on it. And you’ll often see other shoes that you might like [but] you are not as young as you used to be and you need more support, so you can have a thicker heel on the back. So you can mix and match.”

Since leaving Google in May last year, with his colleague and long-time friend Michael Fox, Mike has been busy learning about designing, sizing, manufacturing and selling women’s shoes. Michael’s wife Jodie Fox, who used to work for The Campaign Palace, is also part of the founding team.

The three met while studying law at the University of Queensland.

Mike realised early-on he wanted to be an entrepreneur and started to dabble with Google Adwords while working for a district court judge.

“I heard about Google and I did a campaign for them for a client using Google Adwords and I spent $30 one weekend and  – this is on Friday – they rang me up on the Sunday and said ‘Turn it off because we haven’t slept and we’ve been writing all this business all weekend, and we [have] to go to sleep’. I thought, ‘Ooh, gee. This is really interesting.’”

Initially after joining Google Mike worked in sales, managing “top clients”, then moved to IT and helped develop Google Reader.

“It was just incredible. You know, all these businesses that operate and they do all their advertising on Google or Facebook or whatever it is. They run these little hot businesses serving very specific niches.”

The three started to write down “hundreds and hundreds” of ideas for a new business before settling on mass customisation of shoes.

“We thought this one was quite unique and there wasn’t a lot of other people doing it. In fact, there was no-one online at that time doing it. So we thought this was a great opportunity.”

Shoes are designed on an interactive website. The order is then sent to China for manufacturing. The trio lived in southern China for a while before choosing factories to supply their customers. The relationship with the factories is very important, says Mike. They employ one person in China and are recruiting another.

While Mike does the website coding, and Jodie focuses on marketing, Michael looks after the emails related to sales on the Australian side of the business.

“Some days he sends 100 or 200 emails, and then other days are not as busy. But he’s quite systematic about it. And having worked at Google in the sales team he knows how to do that.”

Mike thinks that, at some point, they will consider paying for a full-time customer support staffer.

“We don’t pay ourselves salaries, so we’re self-supporting ourselves for a year or two years – however long it will take to become successful.”

The team had put every spare dollar into the bank for four years because Mike and Michael knew, even when they joined Google, that they would start a business. They still do consulting work for The Campaign Palace.

“We see this as a longer-term play. At the moment we’re not selling a huge amount of shoes. We’re selling above where we forecast we would be but we see it as a business that will mature in a year or two years.”

He is reticent about being too candid about profit margins because he doesn’t want competitors to enter the market for one-off designed custom shoes. He says the margins are “fairly good” but notes that Shoes of Prey has higher production costs than ordinary manufacturers.

“I’m more than happy for you to write that the production costs are generally 40 to 50 percent higher than [they] would otherwise be because it takes more time.”

And shoes that need to be returned because they are the wrong size are replaced free of charge.

“Usually, 85 to 90 percent of the time we get it right. The 10 percent of people we’ll get it wrong, but we only get it wrong for them once in their lifetime.”

For a traditional manufacturer, it’s easy to get margins of 100 percent or more because all the leather is cut out at once for, say, 20 pairs before the shoes are put together.

“Ours are actually smaller margins than that of a traditional retailer but I guess where the exciting part of the business comes in, is we address so many different niches that are currently underserved.”

People with small feet would normally have to go to a children’s store to buy small shoes. People with large feet, brides and bridesmaids, female impersonators, and transvestites are also lucrative niche markets for Shoes of Prey.

Innovations are arriving regularly. The shoe box, for example, has been spruced up. The original tatty cardboard container has been replaced with an elegant matte-black box with a sliding drawer lined with red-velvet-covered padding. Shoes of Prey includes a photograph that can be pasted on the box so customers can see at a glance which shoes are in which box.

“I think it’s a great activity for bridesmaids and brides to do together. They could have a night where they go around with the computer and drink champagne or whatever and they’re designing the shoes,” enthuses Mike.

Adjusting consumer behaviour remains a problem. Instead of going out on a Saturday to buy shoes that are needed immediately, they want people to approach buying shoes differently. Delivery takes four to six weeks with Shoes of Prey.

“For us, word-of-mouth is so important. We’re only starting to see the benefits now of serving the customers well and then they’re telling their friends, and they’re coming back for repeat orders and things like that. It’s just a very, very slow process.”

The guys have learnt a lot about shoes in the last nine months, so I wonder aloud if there are any benefits to knowing a lot about a subject so dear to the hearts of the fair sex.

“My girlfriend’s into football,” says Mike. “She doesn’t care for shoes much.”

Matthew da Silva writes feature stories to fulfil a dream after working in communications and technical writing roles for two decades. He grew up in Sydney, lived in Japan for nine years and now lives on the Sunshine Coast, in Queensland. He blogs daily at Happy Antipodean ^[1].