Monday, August 10, 2015
Interview with Tony Farwell, GovX
Story by Benjamin F. Kuo
Our interview this morning is with serial entrepreneur Tony Farwell, the Executive Chairman and co-founder of GovX (www.govx.com), a San Diego-based online marketplace aimed at current members of the military, veterans, and government employees, including first responders, police, and others. Tony was the principal investor in STATS, which he sold to News Corp., and also was heavily involved in Hollywood Media, which was acquired by The Times Mirror Company, in addition to a number of other companies. Tony told us a bit about GovX:
Explain what GovX is about?
Tony Farwell: GovX is a technology enabling marketplace. We have a very sophisticated, online verification system that allows us, and those who license our software-as-a-service, to create a sales channel and marketplace for a specfic, qualified group. We have started with all U.S. Military, active, reserve, and retired veterans, as well as federal, state, and local government employees.
What does that marketplace look like?
Tony Farwell: We really serve a two sided marketplace. There is the marketplace where GovX directly serves our verified members, and the ther side is where we enable companies to create sales channels to target that group of qualified users. As example of the latter would be the San Diego Padres, the San Diego Chargers, the New York Yankees, Roadrunner Sports, and other who want the ability to reach that demographic or population, without creating channel conflict. We provide separate, privileged pricing for that target group, and that doesn't interfere with their core, retail sales channels.
Why specifically target military and government employees?
Tony Farwell: My partner in the business built Oakley's military and government sales channel. I felt that we could bring that trusted and protected marketplace to large, premium brands. That addressable market is about $107B, including family members.
Talk more about your background and experience?
Tony Farwell: I have experience in the ticketing area, and my partner has longstanding experience in working with the military and government, those were base exchanges or government entities, with bulk purchases, or directly selling to those qualified consumers.
What's the hardest thing you've had to figure out so far with your startup?
Tony Farwell: Online verification is the core of enabling this marketplace, but also handling member management, figuring out if you are active military or reserve, or other different status. As a marketer, you may only want to reach active and reserve, or you may want to reach the entire U.S. military population, plus veterans. That member management includes not only figuring out your status, and making sure that not only are you, but that you qualify. It's one thing to say that Anthony Farwell is a veteran, it's another thing to say that I'm Anthony Farwell. You need to marry both to ensure that it's a high integrity marketplace.
What is most attractive about this particular marketplace?
Tony Farwell: The military population actually has higher incomes and higher education than nonmilitary peers, and they also have a higher rate of marriage in a household, and great presence of children in a household. They also have higher FICO scores, and are much more reliable and responsible with respect to their households, particularly with loans and mortgages. It's harder to get a clean, government employee demographic, but, anecdotally, they have higher job security, and very likely have higher incomes than non-government peers. We tend to focus on those who serve—police, fire, emergency rescue, Homeland security, and others who protect and serve.
Where are you now with the business, and where are you going?
Tony Farwell:We're just about to hit our fourth year, and we have grown very quickly in terms of both net members and revenues. We are close to 2 million members. We also partner with others that have their own membership base, such as military branch associations. They bring another 2.2 million members to us, through single sign-on access. We believe we are now the largest, direct to military and government purchaser in the U.S. There are others who sell to base exchanges and to the military who are larger but , in terms of both military and government, we're the largest.