Rory-and-Paul — Rory Vollmer and Paul von Hoesslin

Launching on 19 March, a new Internet start-up, LiveBids, hopes to shake up the SA online retail market with a combination of online auctions, pay-per-bid sales and group buying.

Conceived two-and-a-half years ago, LiveBids is the brainchild of two Capetonians, co-founders Rory Vollmer and Paul von Hoesslin.

Vollmer says the idea was to create an “online marketplace to help buyers and sellers fully connect and trade while being rewarded”.

LiveBids offers three selling formats and plans to offer more once the service is better established.

The first of these is the traditional online auction model, where items are sold to the highest bidder.

The second is a pay-per-bid model, where would-be buyers purchase credits to bid on items. These credits go to the seller, which is how it is possible to purchase big-ticket items for nominal amounts.

The third format is group buying of the sort made popular by services like Groupon. At launch, Vollmer says the site will have a handful of products available for its group-buying channel and that he hopes the selection will expand rapidly in coming months.

There are other pay-per-bid sites in SA already, but Vollmer says LiveBids will be the first to offer this model alongside other selling models. “Pay-per-bid is going to empower online sellers and those looking to make substantial profits,” Vollmer says.

Livebids-buying-homepage — Click image to enlarge screenshots

Under the pay-per-bid model, buyers set a maximum credit amount they are willing to bid and these bids are then forfeited whether or not the buyer wins. The idea is that a large volume of small bids will still allow the seller to make a profit, while allowing buyers to win items for nominal fees.

The model relies on the last bid made when the time expires. Should there be bidding in the closing moments, the process is extended by 15 seconds until there are no further bids. LiveBids takes 25% of the accumulated pool, with sellers receiving the rest.

Von Hoesslin says there will be a limited number of products available via LiveBids at launch but he hopes this will expand rapidly.

Wholly self-funded, LiveBids has recently taken up office space in Cape Town’s Church Street. Very much a do-it-yourself operation, Vollmer says he and Von Hoesslin are overseeing all branding and marketing of the site and the start-up has bought dedicated servers hosted in Germany.

Before starting LiveBids, 29-year-old Vollmer worked in auctioneering for a number of years and his family buys and sells antiques. Von Hoesslin, the younger of the pair at 26, has been interested in computers and coding since he was teenager and was running his own software development company before Vollmer approached him about starting LiveBids together.

Asked how LiveBids expects to be competitive in a market like SA where online shopping and e-commerce are immature compared to the developed world, Vollmer says the site’s key differentiator is its multiple sales formats model, and the fact that it’s been built from scratch rather than put together from existing code.

“LiveBids is not a PHP application,” Vollmer says. “It’s been built from the ground up. Many other sites are based on purchased scripts; they have no persona. We believe LiveBids has personality.”

At launch, the site will support PayPal, electronic funds transfers, payment via MoneyBookers and credit cards, with transactions securely processed using NetCash.

As with other online services, buyers and sellers can rank each other so that each can develop a reputation on the site. Furthermore, sellers must supply a copy of their ID document, their banking details and a utility bill on sign up. — Craig Wilson, TechCentral

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