Entrepreneurs in step with a growing venture

Milan has carved a name for itself as Italy’s fashion and design capital. Style is in the city’s DNA and even those with little interest in the subject find themselves succumbing.

Marco Reiter and Moritz Offeney were no exception. When they first met on SDA Bocconi’s MBA programme in 2009, neither paid much attention either to fashion or the fashion industry. Mr Offeney, a German lawyer, intended to join his father’s law firm after completing his MBA, while Mr Reiter, who is half Italian, had an eye on banking.

However, their 15-month programme included an entrepreneurial course and the spark to roll out a business in the fashion sector was ignited. In 2010, while still at SDA Bocconi, the pair set up Scarosso, a handmade shoe company that allows people to design or customise their shoes.

“When living in Milan you are exposed to fashion day and night. So we got inspired by the streets of Milan and the Italian way of dressing,” says Mr Reiter, the 29-year old managing director.

They decided to focus their venture on shoes, rather than clothing, as it was a narrower niche and required less initial investment. The company is based in Berlin, but the shoes are handmade by Italian manufacturers using high-quality materials. Most of the sales are online, allowing the two men to sell high-end products at more reasonable prices, explains Mr Offeney, the 34-year-old chief executive.

SDA Bocconi

MBA facts and figures at your fingertips

Founded in 1971 as the business school of Bocconi University.

Located in central Milan, Italy.
MBA programme ranked 14 in Europe in the FT Global MBA ranking 2014

Average salary about $113,000 three years after graduation

Pay increase of 111 per cent on pre-MBA average salaries

Hand-crafted Italian men and women’s leather shoes sell well in Scarosso’s domestic German market, as well as across Europe. About 80 per cent of its customers are male, aged 30-35 years old, keen on technology and the appeal of online bespoke design, according to Mr Offeney. The company also has six retail stores in Berlin, Hamburg, Vienna and Frankfurt.

Mr Offeney and Mr Reiter got to know each other quickly at business school as they were among a handful of German speakers on the 110-strong cohort. Both men liked the international diversity on the programme as it brought a wide range of ideas and perspectives to the classroom debate.

They enjoyed the classes specialising in entrepreneurship. “We learnt the basic rules of how to set up a business, like writing a business plan, market research and how to raise money,” says Mr Reiter. Meeting entrepreneurs who had set up different types of successful companies was especially insightful. Listening to other people’s experiences and learning from their mistakes and successes proved invaluable when it came to setting up their own business.

Another benefit of their MBA programme was the student-run Bocconi Entrepreneur Club. Both partners took a leading role, with Mr Offeney becoming president and Mr Reiter the deputy. Club activities included inviting successful entrepreneurs to share their experiences, bringing in investors to explain how to raise money to set up a business and persuading students to enter business plans for in-house competitions.

Balancing the course workload and setting up the company at the same time was challenging. Initially the two men borrowed money from their families to start the business as it was the quickest way to raise capital. Both come from entrepreneurial families who were prepared to help, although later investment came from venture capital.

For both men, one of the most valuable parts of the course was the Bocconi network. In the early stages of setting up the company, Mr Reiter and Mr Offeney tapped into it to gain introductions to Italian manufacturers and investors, as well as to bounce ideas off colleagues. Talking to professors from other programmes such as the Master in Fashion course also helped them to understand the market they were entering.

Scarosso employs 65 people and recruits locally in Berlin and at SDA Bocconi. As the company grows and begins to make a name for itself, a steady flow of CVs has been arriving from SDA Bocconi’s MBA students.

Both businessmen are in touch with the school, although these days they
are the ones providing the input. They hold an annual event for the MBA entrepreneurial club, inviting entrepreneurs and investors from their own business network to share their experiences with Bocconi students and pass on advice.

“The event is booked out every year, which makes us very happy and provides us with the chance to give something back,” says Mr Reiter.

Looking back on their programme, the pair say that contact with companies outside Italy and having a more international network of entrepreneurs to tap into would have been welcome when they were doing their MBAs.

“Bocconi helps Italians to find jobs in Italy but needed to step up to help place people on the international side,” Mr Offeney recalls. However, he says Bocconi has been working to build up a more international entrepreneurial network for students in the past few years.

The entrepreneurs found that Milan was a difficult city in which to start a business. The institutions in the city were not “information friendly” they discovered, with little detail online. Added to this was the labyrinth of bureaucracy. As Mr Offeney was based in Germany the two men decided to set up in Berlin, which they considered to be much more business and investor friendly.

Mr Offeney says his MBA “gave me ideas and made me think more globally. It gave me a lot of joy and changed my life.” The option of becoming a lawyer grew far less attractive.

Having established a successful company, the partners are aiming for strong growth at Scarosso, which is now in its fourth year of business. “As a venture capital backed company the business plan is challenging and foresees a strong growth rate of more than 200 per cent year-on-year and we are confident in achieving this,” says Mr Reiter.

Now, after several years of operating the company Mr Reiter says that he would like a refresher of parts of the MBA programme such as accounting, finance and strategy. “I would love to repeat some of the course to better connect my studies with reality.”

Mr Reiter went to SDA Bocconi with only a few banking internships under his belt. In retrospect he thinks he would have benefited from some financial accounting and management experience before he began his MBA.

“A few years of working first would have been good to connect the theory with the real business, especially in subjects like organisational behaviour, human resources and accounting which are not the sexiest topics at university but extremely important now as an entrepreneur.”