‘Total Baltic Startup’ Sellfy Takes on Gumroad and Targets Germany

By Simone ODonovan |

Sellfy is a platform allowing users to sell their own digital content, much like Gumroad – but the new kid on the block is chasing after its bigger rival, and has Germany directly in its sights. In its efforts to offer something different it has turned to payment options and has incorporated Stripe and German service Paymill as it looks to expand internationally.

And it certainly has some decent pedigree. Latvian CEO and co-founder Maris Dagis has dubbed Sellfy a “total Baltic startup” after it went through the Startup Highway accelerator program in Lithuania, before catching the eye of Estonian Skype co-founders Tovio Annus and Sten Tamkivi, who subsequently invested.

The idea for Sellfy was spawned from a side project of Maris and his co-founder Kristaps Alks involving custom WordPress themes when they were unsatisfied with how difficult it was to sell their own digital products online. The platform went into beta in November 2011 and now sells a wide range of things including e-books, currently responsible for the largest number of transactions.

Users can also sell software, video files such as lesson tutorials, music, various audio files and phone graphics. Nearing the first anniversary of its public launch, Sellfy has just reached the 10,000 customers a month mark. There are no up-front costs or subscription fees, jut a charge of 5 percent per transaction – which is slightly less than Gumroad’s 5 percent plus $0.25. The cut is subtracted from the money which is paid to the vendor.

It’s a business plan which creates a positive relationship between company and customer, Maris said: “The core of the company is reliant on our customers’ success. So we must understand the customers and their needs. We want them to succeed, so we succeed.”

Gumroad has been adding to its list of features, which now includes improved analytics and better anti-piracy measures, but Maris remains convinced that neither it nor any of Sellfy’s competitors have yet nailed the right approach for the optimal selling experience. He added: “I still think there are plenty of improvements to be made in order to ease the selling and buying experience.”

One way in which Sellfy differs from the competition is through the use of payment platforms like Paypal, Paymill and Stripe – allowing the company’s focus to stay on marketing and selling. “We see that the biggest part of marketing is actually selling the products,” Maris said “Without our attention being paid to the payment companies, we can focus and improve other things.”

It should also make the planned international expansion easier. Currently, the largest customer base is in the US but the team intends to localise the service into different languages with Germany set to be one of the first to appear.

Having received €8,000 in funding from Startup Highway for 10 percent of their company, Maris and Kristaps attracted the attention of the Skype pair, who provided some initial angel funding alongside two executives from an unnamed Spanish telco comapny. Maris revealed that they are now looking to close a proper seed round.