We talked to Raphael Chow of Wevat about his revolutionary digital solution that makes the tax refund experience convenient, efficient and trustworthy, and he had the following to say:-
First of all, how are you and your family doing in these COVID-19 times?
Raphael Chow: We’re doing well! I’m thankful that I was able to return to Hong Kong, where my parents are, and stay with them for a couple of months earlier. It’s been a very long time since my younger brother, my parents, and I have lived under the same roof, and I’m also very grateful that everyone in my family’s in good health.
Tell us about you, your career, how you founded Wevat.
Raphael Chow: I graduated with a Masters in Biochemistry from Oxford University and joined Deloitte as a strategy consultant after graduating. The journey of founding Wevat was a very serendipitous one; I encountered many friends and family who were struggling to get a tax refund on their shopping – long queues and high fees. It just so happened that 2016 was a year when I was really open to entrepreneurship. So it was out of a resolve to help those around me solve a painful problem and an intense exploratory curiosity that led to me embarking on this adventure.
How does Wevat innovate?
Raphael Chow: We are not just innovating with our technology; we are also innovating tax policy and business model. Traditional refund companies have to sign up retailers who hand out paper refund forms to travellers. This resulted in high commissions that need to be paid to the retailer, resulting in high admin fees that are passed to the consumer. Wevat pioneered the first-ever B2C app in the UK that allowed travellers to download and use us directly – without going through another middleman. This means we can refund much more, on average 25% more, and also provide customers with a seamless, convenient journey that no longer required filling out paper forms.
How the coronavirus pandemic affects your business, and how are you coping?
Raphael Chow: Unfortunately, Wevat is caught in the crossfire of two industries hit most hard by the pandemic – travel and retail. Needless to say, the impact on travel has been huge and so has an impact on our business. However, I feel very blessed to have such a loyal, committed, and talented team, who has worked very closely with me since the start of the pandemic to navigate through stormy seas. We took early action to downsize the team by 50%, extending our runway from 9 months to 24 months. Despite us not spending anything on marketing, we still saw a mini-wave of users, mostly Chinese students, during the summer after the lockdown. This is a testament to a strong product-market fit and is a great reassurance that our team and product are doing something special.
Did you have to make difficult choices, and what are the lessons learned?
Raphael Chow: Yes, many. The hardest and most painful one was definitely letting go of some great team members and orientating a smaller team so that everyone steps up to do more. One big lesson I learnt is that no matter how much it may hurt in the beginning, making a tough decision sooner is much better than sitting on it. I also realized that as a leader, it is so important to be empathetic, trusting but also confident at the same time. I believe finding this balance is the key to the leadership of all modern organizations.
My leadership skills were recently put to the test again when the UK government decided to cancel VAT refunds from 1 Jan 2021 onwards, an appalling move that harms the country’s economic recovery and could threaten to wipe out our business. After hearing about yet another tremendous challenge, a VC friend of mine even rang me up to say, “it’s okay to give up.” I decided we will fight on because Wevat’s brand, technology, and know-how can be transferred to other European markets like France and Italy, where I expect a lot of tax-free shopping to be diverted to in the coming months and years. As Einstein once said, “In difficulty lies opportunity,” and I’m keen to make a success of it!
How do you deal with stress and anxiety?
Raphael Chow: I went on a surfing trip to Nazaré, Portugal, recently, and one of the pro surfers was explaining to me how when he gets caught and held down by a wave, you have to just let go. This is especially important in entrepreneurship. I’ve found that when faced with adversity, the best thing is to lean into the problem rather than shy away. During moments of stress, I use exercise as a way to find my motivation again. At the end of the day, what makes me wake up and fight again is a firm, unyielding belief in the future I am creating and that the current challenge will be but one of the many I will have conquered when I look back in ten years’ time.
Who are your competitors? And how do you plan to stay in the game?
Raphael Chow: Our industry is dominated by a duopoly of companies who’ve dominated the space for decades. We’ve been able to side-step much of this competition by offering tax refunds using a completely new B2C model, being digital-first, and having an entirely different vision altogether. Unlike traditional tax refund companies, Wevat is founded on its ability to provide great service to its customers, and that also means owning the customer relationship. Therefore, tax refunds will be but one of the many services related to travel and shopping we will offer in the future.
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