Want to be the next Uber? ITS a 3-step plan to get there!
Uber’s going to do $11 bn in 2015, and $26 bn in 2016??! And it’s valued at more than $50 bn??
Now where did THAT come from?
The taxi business was local, and relatively small. Till Uber came, and turned this industry on it’s head. And generated scale and expanded rapidly. And became a game changer and an icon, so much so that the brand name has become a verb to describe such a business model – one that connects a hitherto disconnected latent demand and latent supply, through a mobile app! “Uberize” is what one does, in creating such a connection.
So yes, you may slurp as you see the sexy valuations and the revenue numbers of models like Uber and Airbnb, both of which fundamentally “uberize” their industries.
And now we have other industries following suit, in some or the other way, e.g. Practo, which connects doctors and patients!
So are you tempted to make an Uber yourself? If you are, and don’t know how, consider looking at it, as a simple 1-2-3 step model. And let me explain to you how it works:
- Identify an industry that is fundamentally local, but one that is an essential need, and would quite likely be found in all localities across the world. Like taxis that Uber identified. You think that is difficult? Don’t get stuck on taxis and overnight stay rooms (viz. Airbnb). Go beyond these. To as I said, “businesses that are essential, that are local, and that are found pretty much everywhere in the world”. Still find it difficult to get some examples?? How about milk delivery business, how about the laundry or just the service of ironing of clothes, or hair cutting saloons, etc.??
- Industries like these are typically served on basis of location proximity, and quality of service or rates are given lower priority. Just the comfort of having someone around, nearby, is the reason one keeps going to one place or getting served by one service provider. This is a perfect opportunity to disrupt! Why should it remain a local service provider? Why not the most efficient one, when you need it? And as a consumer, it doesn’t matter if the service provider comes from the next building, or from a few lanes away, or from a different corner of the city, does it? A mobile app that connects service providers to consumers, on real time basis, and based on demand and supply, at that moment, is this next step. So this is basically the Tech stage here.
- Once you’ve got these two steps done, simply throw it open and make it global! And you could be the Uber for getting clothes laundered, or for a home service of a hair cut, or whatever. Scale’s the thing. Scale’s the route to high revenues and high valuations!
Yes, at the fundamental level, these are the simple 3 steps.
Identify – Technology – Scale or I-T-S model! That’s it.
Of course, for ultimate success, all of these need to be done very well, but that is a necessity for any large success!
So are YOU ready to Uberize a new industry? And make riches for yourself? Go for it! And since you read it hear first, I don’t mind a small percentage of equity for “triggering you forward”!!
All the best.. !
Short term vs Long term, Constant Trickle vs Big Bang, Product vs Service: It is an Attitude Choice, more than anything else!
Besides the variety of other differences that one may find in business plans and business models, one crucial difference between business plans is what I am discussing here.
I come across business plans that involve a few years of building out. Maybe it is a prototype, maybe there is R&D effort, maybe the big software piece needs to get done.
Till the point of time that this happens, there is only investment, and no revenues.
Someone needs to fund the entire effort.
Of course, the conviction in such cases usually is, that once done, the product that has been made, can be a rip-roaring success, making it worthwhile to have invested the time and the money.
But the big risk in a model of this kind is that, while one is building it out, there could be someone else also doing the exact same thing. And that they could go to market say, a few months before you are ready. And steal the thunder and the market.
OR in this period while you are building out, some fundamental inflexion point occurs, that puts the entire business model at risk. And that after, a lot of investment has already gone into building it out.
The alternative to this model of course, is something that requires lesser development time and effort, can get to market sooner, can perhaps be made in phases, so that first phase product is out, getting tested, getting validated, and perhaps earning revenues too. In a sense, there is some amount of de-risking that takes place, in the process.
The fact is that we NEED businesses with an R&D base, we need businesses that may have a long development cycle because only then, will the interesting product get born. But the validation of the model, the technology or the idea must be really strong, to justify the long time and money investment, before the product sees the light of the day.
Most importantly, the entrepreneur working on this project needs an attitude that sees such a long term vision. That sees the day-to-day progress, works with the timeline of the end delivery, keeps costs under control, and yet, is relentless in pursuit of the dream, of the big picture. Notwithstanding the fact that there are no revenues and that money is getting sunk into the project, each passing day, and the fruits will come, one day. Hopefully.
Only people with the right attitude of this kind, can nurture business models of this type.
Another scenario that this attitudinal difference can be seen is in running businesses, with a particular kind of revenue model.
There are some businesses where the revenue cycle is dependent on just a few large transactions happening in the course of the year. Say, a revenue cycle dependent on winning 3-4 large tenders in a year. In such cases, there is immense effort at the pre-sales level, often a matter of several months, in working towards a favourable closure of these revenue opportunities. And at the end of the year, getting say, 4 such deals, is a winning situation. Getting 2 deals may be break-even, getting a 3rd may mean nominal profits, and the 4th generating the large profit opportunity that the business is working towards.
For all the efforts put in the pre-sales activity, it is quite possible that ultimately, the sale does not close in your favour. WIth a binary situation of a yes or a no, in each of these large revenue opportunities, it can easily happen that there was a bad year, and one ended up with only one success.
How vulnerable is this model?!
Then again, if you are in a business of this kind, you have no choice.
Many others though might prefer, a constant trickle into their cash boxes rather than the few big-bangs.
Whether you as an entrepreneur opt for one or the other business model again depends completely on your attitude.
If you are working on the 3-4 large deals to happen in the year, can you maintain the confidence that you will get those, that you are able to fund your regular expenses even while you wait for those big deals? Can you keep investing the efforts without any sense of panic around “what if these deals don’t come in?”? That kind of attitude is required to support the business model dependent on a few large deals.
If on the other hand, you need to see the ringing of the cash box, to get comfort that ‘all is well’, you are better served doing a business model that generates regular cash, and not just the big bang large deals.
It would be a gross misfit if you were to attempt a business that gets few large deals and no cash is generated rest of the year. There is every chance that you will end up with panic very soon.
This analogy extends to the individual too. After all, the individual is akin to a proprietary business of sorts, isn’t it? Especially if you consider the professional, someone who bills for his time, on projects.
Here again, there are different kinds of professionals. Some like practising doctors or fashion designers or interior decorators, who have a “running business” and an accompanying regular inflow of revenues.
And then there could be others like film actors say (not the very top notch ones who are working three shifts, but the second notch and below ones), who work when they get a project.
Sometimes they sign on a film, which has to go to the sets in 6 months, and the earnings will really start after that. And for some reason, that start gets delayed.
Or one is just waiting for the right project. Which takes time to come in. And in the meanwhile, there is not much to do.
So again the question comes, “what if the projects do not come at all?”, “what if the project I signed up, and committed my dates to, gets delayed, and I don’t earn till it starts?”.
If one is susceptible to such insecurities, then this kind of a professional career is certainly not for that person. On the other hand, if one has adjusted to this kind of uncertainties, has prepared for the same, and has enough confidence that some or the other project WILL come by, and the incoming revenues will keep happening, that person is well suited for a career of this type.
So considering this blog is focused to startups and for startup entrepreneurs, the thought to consider is an examination of your personal attitude on these fronts.
Can you work for a big prize, wait it out for a longer duration for the same, be confident and comfortable in the waiting period, be focused to keep working towards the goal, then and only then, should you opt for a business model of that kind.
Else what you need is something that can go to market fast, start generating revenues fast, and keep funding your cash flows, as well as soothing your nerves!!
What do you say??
The Amazing Breed of Young Indian Entrepreneurs
Recently I attended StartUp Garage, just for a few hours, but I managed to interact with several young entrepreneurs and wannabe entrepreneurs.
This was not the first experience for me. I make it a point to connect with this breed, at various other startup events and mentoring opportunities, including Headstart’s StartUp Saturday, at the MentorEdge Rendezvous sessions, and TiE’s mentoring events, amongst others.
And almost always, I come back feeling very impressed. By the entrepreneurial energy in the first place. And sometimes, by the quality of business ventures that some of them are working on.
I think back to the many years back, when we graduated from engineering school. I do not remember a single classmate of mine, who went out, straight from college, to start a venture of his own. There were few who went and joined their family businesses. Which is an entirely different thing. But none that I remember, who started new ventures of their own, straight out of college.
Years later, many of my batchmates are today, running successful entrepreneurial ventures. But they all started after taking a few years experience, working in industry. Typically.
As against that, I am seeing just so many keen final year students (of engineering or management schools, typically) and students who have just passed out of college, who are all set to get into a business venture of theirs, I am amazed by it all!
That one has the dare at the early age, to chuck job offers, and venture out on one’s own.
To take on the challenges, not just of giving life to your idea, but also to take on other accompanying challenges of finance, team building, marketing, etc.
So irrespective of how good or viable these ideas are, that we have so many attempting to create their own businesses, it is truly impressive.
Coming the actual quality of the plans though, perhaps 1 out of 20, are good enough (by my assessment – and I could be wrong, of course!) to potentially become decent successes.
But that is not a bad ratio.
I was completely impressed for example, by this one entrepreneur, who had finished college few weeks back, and who demo-ed to me, a completely working and commercially viable, SaaS based video conferencing tool, with some excellent features. He may still have some challenges to get the UI improved, and of course, to figure out the pricing model and the marketing, but he has a full-fledged working prototype out there. Obviously made, even as he was a student in college.
Now that takes some doing.
And there are more like that.
I have this one other group of students, from another engineering college, who have set up an e-commerce venture, for selling text books. Again straight out of college. And a business model that I think, is extremely attractive, and can become very successful, if they can execute it right. They interact with me once in a while, and I am very bullish about this venture.
Indeed, these are excellent times, for India’s economy, and this level of confidence and dare, amongst the youth, can only help propel the growth rates. I am very happy about the entrepreneurial ecosystem in the country now. And I am happy to have occasional run-ins with these smart youngsters, and also happy to share the occasional gray hair wisdom with them 🙂
Startup Founders: Better Alike or Different??
I spent a few hours at the recent Enterprising India Summit, organized by the Mumbai Chapter of TiE.
In the short time that I was there, I happened to catch a talk by Sachin Bansal, founder of Flipkart. As a part of his presentation, he talked about himself and his co-founder, and about how they were so alike that they could virtually replace each other. Well, at least on the work front. And of course, he was making it look like a great advantage that he had, in having two founders, with very similar backgrounds and skills.
I have wondered about this, though. Of course, not for Flipkart in particular, but for any entrepreneurial venture, in general.
It is an easier route often, for two (or more) classmates or good friends (with similar mindsets) to think about getting together, and starting an entrepreneurial venture. And quite likely, they may have the same background, skills, aptitude, approach etc. And maybe due to this factor, there is a fundamental comfort, as they may end up agreeing more than disagreeing. This may also make for good chemistry.
But is this good for the venture?
Think about it from these perspectives:
1. A startup is usually a lean organization. Each person of the startup team is contributing in his / her own way, so as to make the whole. There is usually no room for buffer and no room for redundancy. Then, having two (or more) very crucial members of the team, viz. the co-founders, to have similar backgrounds, is it not an expensive redundancy for the startup?
2. We have also read stories of the so-well-constructed founding team of Mindtree where they were absolutely clear of the kind of skills that were necessary to build Mindtree as a company, and how they looked for, and found and lured people in, to be a part of that founding team. Recent events have put a question mark on the company, but that apart, the effort at the time of founding, and the process, was exemplary. Is that a better way to go about it? Identify key skills that will be necessary for your mission, and then look for partners who can be co-founders in your venture??
3. When things are going fine, it is good to have people who ‘get along well’ and have a similar mindset. However at the first signs of challenge, what if the co-founders all, only think in one common way? What if there is no counter point of view? There is no challenge to the proposal? While different mindsets can sometimes cause potentially, the ship to go in different directions (however, that happens when there is a lack of maturity in the team), on the positive side, different mindsets or approaches give you multiple perspectives on the same issue. And at different times, there may be value and relevance of a different approach. In that respect, non-uniformity of thought, a certain diversity in fact, is a great asset to have, at the founding team level.
So I do wonder on the best approach here? I think startups need a mix, at the founding team level. Success of Flipkart may not be because the founders are so-alike, but in spite of it! Sometimes, we look at success and try to draw all inspiration from it. Try to ape the entire model. Flipkart may not have succeeded because the partners are so alike, but because of managing to do many other things right.
Also it may be appreciated that two or more people, going to the same college or the same program, do not necessarily make for identical people. Yes, their educational background would be same (and if technical skills are crucial, then this may again be a challenge – that all founders know only the one same thing!), but in terms of aptitude or creativity or other characteristics, they could easily be chalk and cheese.
So that is the crucial element. Have the chemistry to work together well, the maturity to respect each other’s points of view and take decisions only and only, in the interest of the venture, but yet be different enough, to bring variety of skills and approaches to the table, for the venture to get the best value!
What is your opinion on this? Are you a part of a co-founders team? What kind of mix you have in your founding team? Would love to know about his.
** This post is also cross posted in my personal blog, Random Musings. **
Why One More of the Same Thing?
I come across startups at variety of forums, like TiE, Mentor Edge, and also directly, when people reach out to me.
And it beats me as to how many times, I keep coming across the same (well, similar) business idea!
I am not referring to two entrepreneurs, coincidentally working on the same brilliant idea. I am referring to entrepreneurs working on an idea, where there are multiple dominant players already in place.
Like the 35th Group Buying business.
Ok, irrespective of my personal feelings about Group Buying (and which you can read in this blog, across more than one posts), assuming that it will be a successful model, what is the different thing you want to do, where as a 35th entrant, you still expect to come out successful / leader??
In the world, there may be examples to prove ANY theory.
So one would try and justify their entry by saying that wasn’t Google a late entrant in the search engine market, and did it still not come out on top?
Just the same way, people like to quote Apple as an example in many different arguments (“Apple does not do much of its own Social Media – the users create the buzz for it. Can we also expect that?” for example).
It needs to be understood that Google or Apple or their business models or their marketing strategies have been exceptions rather than the rule. Also that, fundamentally, both (and others of their kind) have a phenomenal product behind them, and even if they were to not do anything, maybe people would queue up outside their doors, with their cheque books open, looking to purchase!
So first of all, every entrepreneur must not think that he is a Google in the making. Without trying to reduce any ambition or aspiration of the entrepreneur, it is necessary to have feet on the ground, while planning the business strategy, and the positioning.
So while I have seen a bunch of Group Buying plans that did not differentiate from the many existing ones (at least in my mind), recently I came across another business model, that was similar to at least 4 other existing players. All 4 are reasonably well established, and this was the 5th one, entering the same space.
Basically a content vertical, largely ad dependent for revenues, significantly demanding to maintain (at least for good quality). The entrepreneur was trying to show me the differences that he had made in his model, vs the other prevalent ones. Even though he may be right, in pointing those out, to me (and I’d be like a typical consumer for his content), I could not spot those differences, without his explanation. And for a content heavy site, a typical user is not going to run over it, with a microscope to see those differences.
Why then, would a consumer change habit and come and read content here, instead of the others which he was familiar with? I was not able to see it. And I told the entrepreneur in as less discouraging a tone, as I possibly could.
Of course, entrepreneurs are optimistic, if anything. All of us are. We want to give it our best shot, we feel we have the way to make this happen, we reckon that all things being the same, WE are that difference! So I am sure he is going on with it, and my best wishes to him too. And in a few years, he could have gone past the incumbents and emerged number 1. Again, I would only wish the best for him.
But my point is for one who is planning a business. Where do you start? Do you look for existing successes, and want to try and do one of the same kind? Or you come up with something entirely new, something different, something that the world has not seen just yet?? But which you recognize, would have value?
It is often easier to look at existing successes, and which is perhaps the reason why we see more me-toos, than original ideas. It takes a different vision, a certain imagination, creativity, and then a significant dare, to get into path breaking new thoughts, new ideas, new businesses. And which is why these are rare.
I urge entrepreneurs to look to being different, being unique. More than being clones.
Especially in an online business.
In an offline business, due to various factors, including geographical relevance, many brands of the same business model, can survive. Perhaps be successful too.
Online, everyone’s just a click away. There is no compelling reason (like geography) that a user will land to your site, even when there is a better site, more known, more popular, already around! Have we found a serious second auction site, after Ebay? NO!! Because Ebay is a click away. Why would anyone go anywhere else?!
Think about it.. being different can be more challenging, but can also be more rewarding!
The Social Network: My Learnings from the movie
Yes, this is kind of a movie review, of ‘The Social Network’. And ordinarily, I post my movie reviews on my other blog, but I am writing this one here. This blog here, is more focused to budding and fellow entrepreneurs, and I usually review startups here. So what is a movie review doing here?
Well, the movie ‘The Social Network’ is an entrepreneur’s movie, if anything! And there are many learnings to pick up, for entrepreneurs, and hence, I felt that this was the right place for this movie review.
The story is supposed to be of Mark Zuckerberg, the youngest billionaire in the world, and the founder of Facebook. Well, there have been some liberties taken, and hence I state that this is ‘supposed to be’ Mark’s story. Be that as it ma be, even if it is close to being Mark’s story, it is fascinating to learn about the man behind the name. Biographies of successful people are always interesting from that point of view. Usually of course, these are written (or made into movies) when the person concerned, is of advanced age. But in this case, the person has achieved success – stupendous at that – at a very early age, and so you see a movie about him, while he is still very young.
And perhaps there will be room to add a sequel. For there is no mention in this one, about the Microsoft investment. Or for that matter, about the move to take Facebook beyond the schools and colleges, and out into the public. And of course, I am sure bigger things are in store. Be it his battles with Google, or building pieces to take on the likes of Twitter, Foursquare or Paypal, there are interesting new things happening in Mark’s life, and in his business, and a sequel few years down the line, could well be in order!
For now, lets look at this first film on him, The Social Network.
The story is engrossing, for understanding the drive and the passion that it took to make Facebook. Like my daughter remarked after she saw the movie, “he was coding non-stop for 36 hours”. Well, that was just a part of it. But a crucial part, where there was amazing conviction, and which was supported by the commitment to ‘make it happen’.
I was not aware of the Sean Parker connection, so it was good to see that part. About how his biggest contribution was about dropping the ‘the’ from ‘thefacebook.com’ and making it to what it is today, viz. simply facebook.com. Or how he showed Mark, the path to California, and how it was a crucial shift for Mark and for Facebook.
The conviction that he saw, where he realized that reaching 75,000 users, or even a million for that matter, was just about taking smaller steps to the very big goal that he had in his mind. Many, including his co-founder, could have got satisfied, felt that they had already achieved a lot, and tried to monetize early. And which would not only have meant the lack of further growth, but would have stunted what was already there, due to drop-outs on account of the monetization drive!
These, however, are the most crucial three moments that I picked in the movie, and which are my key questions to fellow and budding entrepreneurs. Whether you have got these moments for your business yet, or not?
1. After the short-lived success of Facemesh, when Mark is working towards the new project (what became Facebook), he learns from the Facemesh experience, that people jumped on to Facemesh, not to see hot girls (which can be seen at many other places), but to see girls whom they knew.
It is a very crucial observation, and a very critical one too. Do you pick these nuances, naturally, in your business too??
2. The second Eureka moment is what lead Mark to put the ‘relationship’ field in the Facebook profile. Where he was trying to replicate the physical Harvard experience on a social network, and he could have simply put all the physical activities and efforts into the virtual world, the important thing was about identifying the key driver. Sensing that ‘relationship status’ will be one such factor, was an excellent breakthrough.
Other Social Networks have replicated many of the standard features that work on social networks. Say,Orkut for example, has done that. But they have not picked those crucial driving moments. And due to which they have not struck the serious growth levels that Facebook has managed.
So have you got those defining aspects that can be the game changers, in your business??
3. The third crucial dialog is what Mark has with Eduardo, after he has blocked the account. That money is required, to ensure that business flows without slightest interruption, to ensure the servers keep chugging away. As he says, “Facebook cannot stop. These are friends who know friends and so on. Even a few moving out, can be like a domino effect!”.
Well, against this obsession, we also have Twitter where fail-whale is a regular occurrence. And yet, it has managed to hang in there, as a business. But I would call it the exception!
The obsession of Mark to do all he can, to ensure that users get an uninterrupted, perfect experience, is what all businesses should strive for. It is more crucial perhaps for Facebook, where people are friends, and as Mark says, few guys moving, could cause a domino effect. But in today’s connected world, this is true for ANY business or service. If you do not do everything in your means to keep your existing customers, and few start leaving, you do not know when you could have a domino exodus away from you!
Are you as obsessed as Mark is about keeping each and every customer of yours??
All in all, it is a fascinating story to learn about a successful person. And it is clear that he is brilliant, but also extremely focused on what can work, how he wants to provide clear value, and how he has a bigger picture in mind, to take Facebook to newer and newer highs!
Looking forward to see where the business goes further, and to a possible sequel to this.
And looking forward to entrepreneurs being inspired by the story!
Have you seen ‘The Social Network’? What did you think of it? Do share your thoughts in comments below..
What does it take to run a successful digital business in India?
This was the topic given to me, by the organizers at the Shailesh J Mehta School of Management, I I T Mumbai. Originally meant to be a panel discussion (would have been a very interesting one, I bet), it was later converted to a talk by me.
Even as I was preparing my thoughts for this subject, I posted the question on my Facebook page to ask my friends, what they reckoned, does it take to succeed in a digital business in India. And I got responses that included the need for velocity, passion, doggedness, understanding local nuances and culture, etc.
Which were all right, in their own way.
But I guess all of those factors, and many more, are relevant for just about any business, and not particularly digital businesses. So focusing specifically on digital businesses, and for India in particular, I put some thoughts together.
It was important to appreciate key words here, viz.
Success – not about winning a business plan competition or getting angel funds or even VC funds. Success, for this context, was about generating a sizeable business, making money (as against burning money), creating a brand, perhaps an IPO, etc.
Digital – every business nowadays has some digital component. So we are not referring to those. We are also not referring to creating applications for deployment on the digital space. Since creating applications is a software business, whether for online space or otherwise. So digital in this context, was about close to pure-play digital businesses, typically online types like e-commerce, services on a digital platform, portals, and the like.
India – for me, meant that the operations are based here. But that is not to stop serving a global market.
With that context, and focusing more on the business side and less on the technology side, this is what I put together (note that bullets are cryptic, as there was talk that supported these; so, not sure if all of the points get across – no, don’t have the time right now, to elaborate the points!):
Would love to have your views on the subject. Please share in the comments below.
LifeMojo.com – a very useful diet and fitness resource
Himanshu Khurana, co-founder, asked me to review his startup, LifeMojo.com.
LifeMojo.com
Category: B2C -> Healthcare -> Diet and Fitness
What does it do?
LifeMojo.com is an excellent destination for those conscious of diet and fitness. It provides ample information about dieting, different fitness regimes, lifestyle based information, and also has nutritionists on call, for personal assistance.
What more?
The site is very well designed, and although it caters to an Indian audience, it has a very international appeal, and an excellent look-and-feel. In addition to one-way information about diet and fitness, the site also enables interactivity, in the form of a user being able to track his efforts and target certain fitness goals, and see the progress in form of charts and graphs. Lifemojo also offers tracking and updates via mobile, and engages its users via social media through Facebook, Twitter etc.
My quick two cents:
LifeMojo.com is positioned very well. It is doing an excellent job in terms of its presentation, its focus, the detailing, the value that it provides to its users. Subject to getting the revenue puzzle right, LifeMojo is destined to go places.
Wisdom Nuggets in more detail:
1. At the outset, I am very impressed by the business. So I would suggest to the management, to continue to maintain a very high class of service, in all respects, and establish excellent brand equity for its service. It is a service idea that will appeal to the better class of society. After all, it is the more privileged section of society who have problems of weight and diabetes, usually. A classy feel will be appreciated by this demography, and LifeMojo must ensure that it does not sacrifice this appeal.
2. The “about us” section of the site mentions numbers in few millions, as people in India, referring to dieticians and fitness programs, and also those suffering from diabetes. These numbers become a kind of market size that LifeMojo can address. So the potential market size is large. How many of them make LifeMojo their online destination will be the question.
3. The challenge with diet programs or fitness regimes is that people do not stay disciplined long enough. There is a tendency to “go back to the old ways”. If LifeMojo can become a close companion of sorts, to these people, and somehow manage to keep people on track, then LifeMojo will become an integral part of the person’s life. And in that, could be the major breakthrough for LifeMojo’s sustenance.
4. Even after paying fees, there are statistics of very high drop out rates from fitness programs and gymnasiums. With an impersonal and free service, there is a bigger risk of drop outs from LifeMojo. Simply having an ability to track the progress is not enough to ensure a member’s continuity with LifeMojo. The challenge for LifeMojo will be to understand at a psychological level, the reasons why people drop off fitness regimes, and to find a way to address this issue well.
5. Community can be one of the critical pieces of the puzzle. People tend to remain members of a group yoga or aerobics class longer than sustaining an independent diet program. Groups matter. If there is a community, and it is active and buzzing, and it involves large participation, that could be one of the reasons for members continuing with LifeMojo.
6. The revenue puzzle is definitely there. Himanshu informs that revenues are expected from nutrionist and fitness consultations online, and on phone. This appears to be very “iffy”. People are comfortable to visit such consultants personally, so what percentage of the potential market will be happy to seek online or telephonic consultation, is something to be seen.
7. There could possibly be a freemium model introduced to generate some revenues from the users. Provided there is real value offered, and which can be appreciated by users. A personalized consultation, with the presence of an individual nutriotionist or a dietician, is not a great online model. It is also not scaleable easily. For an online model to be exciting, each subsequent transaction should be at marginal cost. And which points to an automated self-help situation, rather than having a personalized consultation. Alternate ways will need to be found.
8. Are there pockets in the country, say in semi-urban centers, where good quality dieticians or nutritionists are not available? Can the service specifically target such pockets? Or if there are sports related recommendations or other specific conditions related recommendations (e.g. pregnant women, seniors, recuperating patients, etc.) that can be addressed, then again, there is potential to create a good niche for those. There could be diet and nutrition recommendations for growing children. As soon as a high level of knowledge is created in the niche segment, there is also opportunity to go and tie up with large groups, e.g. private schools or hospitals etc.
9. The other option to scale is to go global. However then, the knowledge of global challenges, diseases, lifestyles, food habits, etc. all have to be incorporated in the knowledge base.
In summary, I would conclude that LifeMojo is an excellent proposition. It offers good value, which is presented well, it is interactive and engaging. However due to the nature of vertical that it is in, there is an inherent high drop out rate. Even when there is personal engagement offline. It can be worse in an online situation. LifeMojo will need to figure this out, and also ensure that revenues are generated. Otherwise, there is a risk of an excellent idea, not reaching high scales, simply on account of low adaption and lack of consistent traction from users.
GRAY SCALE RATING: 4.0 / 5.0
MnemonicDictionary.com – an excellent destination for vocabulary improvement
Amit Aggarwal, the founder, asked me to review his startup, MnemonicDictionary.com.
Mnemonic Dictionary
Category: B2C -> Education -> Vocabulary
What does it do?
MnemonicDictionary.com is an excellent source for all kinds of fun and learning, with and around words. It is a destination to expand your vocabulary, play word games, take quizzes, etc. In short, MnemonicDictionary.com is quite a complete, one place destination for any word lover and words learner!
What more?
MnemonicDictionary.com features a word of the day, for those who want to enhance their vocabulary gradually. It also has word lists for people working towards competitive exams like GRE, GMAT etc. The site exploits the various features of community by having an active forum, chat rooms, via email and also an active presence on social networking sites like Facebook, Twitter, etc.
For revenues, there are advertisements and affiliate relationships across the site.
*** Addendum ***
Amit pointed out to me a very interesting USP that MnemonicDictionary offers, in regards to remembering new words, viz. the concept of mnemonics.
For example:
- Onus (meaning: burden)
Mnemonic — ON-US you are ON US ie. you are burden to me,
Similarly,
- Caulk , which means ‘to make watertight’ can be broken as follows:
Mnemonic — caulk sounds like cork which makes bottles watertight
*** End of addendum ***
My quick two cents:
MnemonicDictionary.com is positioned very well in its area, and does most things right. In terms of exploiting the various options to an ideal web business, the site is doing nearly all that it can do. The challenge may just come in creating larger revenue base. If currently, the business is running at a low cost with a small team, they are probably well poised to make money. Some out-of-the-box thinking will be necessary however, to aim for large revenues.
Wisdom Nuggets in more detail:
1. There is genuinely not a lot to fix at a fundamental level, in MnemonicDictionary.com. Indeed, I am very pleased with the entire execution of the business. So the first thing that I would simply suggest is to hold it nice and tight, and keep up the good work.
2. Vocabulary building, for a common person, is a fun thing to do, for a few minutes a day, at most. So for the large user base, this is where the engagement with MnemonicDictionary will saturate. Can MD find a way to engage with such users beyond the few minutes a day, that they take, to learn a new word? This is where the thought juices must flow.
3. Of course, there are those who are working their way towards some competitive tests. For them, there is indeed a larger engagement possible at MD. And they will spend more time doing word lists or taking small tests. In these cases, MD still does not deliver a complete solution for these students. Thus the student may be still using other training forums / classes and will be coming here, only for additional support or tests. If MD can offer full fledged and complete training and testing environments for tests like GRE, TOEFL, GMAT etc., then they can secure a larger lock-in over this user base.
4. Due to the briefer engagement with the larger mass user base, and an inadequate lock-in with the students working on competitive exams, the revenues may not be large or consistent. Since they are restricted to advertising models only. An opportunity exists in introducing (as mentioned above) full fledged training and testing models, and convert the service into a freemium model, rather than keeping it totally free for the users.
5. If there is an opportunity to become a value-added-partner or even a white-labeled partner with established testing service providers like Princeton Review and Kaplan, involved in competitive tests, that may generate good additional traction, in terms of revenues.
6. The other time that a lot of language skills are learned by people, are during immigration to western countries. Here again, the opportunity could be, to develop training and testing modules for immigration related language skills, and increase earning potential for the site.
7. Overall, there is indeed, a huge demand, at least in countries like India, for English language skills. Notwithstanding current downturn, there is a basic irony – of large scale unemployment in tier 2, tier 3 towns, on the one hand, and a large demand of good English language skilled persons, amongst BPOs, call centers and the like. This gap points to a single and simple factor – English language skills. Due to lack of good teachers, who can travel to these small centers and teach English there, this gap remains. Can MD create a remote delivery model, for teaching English? This may be an ambitious leap from where they are, but can then create a significant opportunity for jumping the scale of the business.
8. The other option for jumping scale would also be, to create a proper English learning platform for people of other native mother tongues. Be it the many Indian language native speakers or even say, Chinese persons. Having covered the one side of the puzzle, namely the English language part of it, if MD can invest in the native language side, one language at a time, then they can present “learning English for Hindi speaking people” or offerings of that kind.
9. Lastly, there is a big opportunity also in learning how to SPEAK the language. With audio-video becoming common place on the Internet, if MD can find ways to deliver language skills, also via audio and video media, then the users can also learn pronounciation and spoken English.
In summary, I can state that MnemonicDictionary.com is on a good foundation, and if they decide their larger focus well, and work towards it, they can become a sizeable and very successful business.
GRAY SCALE RATING: 4.0 / 5.0
Kreeo.com – Collaborative Knowledge Management and Research Tool
Sumeet Anand, founder and CEO, asked me to review his startup, Kreeo.com.
Kreeo.com
Category: B2C -> Web research tool; Enterprise -> Collaboration and Knowledge Management tool
What does it do?
Kreeo.com is an interesting mashup of a Wikipedia and social bookmarking sites. It is a tool for collaboration and knowledge management, and offered free on open web for individual users, and planned to be offered also on web based SaaS as well as in enterprise versions.
What more?
There is obviously a significant software effort that has gone into the making of Kreeo.com. For example, there is virtually a concept of a browser within the browser. You do not really need to use the back button at all, as you navigate through the various pages in Kreeo. The navigation, layout, presentation have all been done with thought, and are good.
My quick two cents:
You can’t help but think Wikipedia as you see Kreeo. Yes, there are differences. But to an average user looking for information, does he notice the various subtle differences. Also most importantly, content is the key. For a site of this nature, we are talking of tons and tons of content. Without that, it leaves me with a feeling of a great idea, but being unable to appreciate the nuances, without adequate data. Moreover, without data, it does not compel me to return soon!
Wisdom Nuggets in more detail:
1. I have a suspicion – and I could be wrong – that Kreeo was created by fundamentally, a technology person! There is a huge emphasis on the application, perhaps to an extent, at the cost of the larger business model.
2. Sumeet informed me the beta was launched in Jan 2009, after a year of alpha. That being the case, it would have been great to have used a part of that one year, also for creating some content for Kreeo. At this time, without the content, it creates interest, but then disappointment.
3. There will be questions about why Kreeo, and why not Wikipedia? Even on the SaaS or Enterprise versions, there are enough Wiki implementations available to serve the purpose. With all the technology bits, the core reason to look at Kreeo as against a Wiki, does not come out that clearly. If it takes an effort to understand that difference, it may not quite be good enough.
4. On a content driven aggregation, we have also seen in recent days, Guy Kawasaki’s venture, Alltop.com. The strategy that Alltop has used has enabled it to grow significant content quickly and it keeps growing. As a pure web reference tool, it may today offer better value than Kreeo does. So yes, I am getting repetitive on the content front, rather the lack of it, on Kreeo. But that unforutnately, is a big issue on Kreeo, at this time.
5. So where does Kreeo go from here? If Enterprise and SaaS is the way to go, and to offer Kreeo as a platform for enterprises to manage their knowledge, then it is important to focus only on that. And present these solutions with all the differentiation and the benefits coming out strong and clear. If enterprise content and knowledge is what Kreeo will drive, let it not dilute the brand and the offering by also being in the larger B2C / Social Media space.
6. On the other hand, if the larger B2C is what beckons, it must be appreciated that creating an encyclopedia of sorts takes a toll. Even in a collaborative mode. Either there has to be a clear strategy to energize the masses to contribute and create, OR Kreeo could think of focusing on a few verticals, instead of the entire universe. And at least for those few verticals, ensure that real depth of information exists.
Overall, I must repeat that the technology is promising, but I am concerned about the business model, at this time.
GRAY SCALE RATING: 2.5 / 5.0
Inspiration
UPDATED INSPIRATION: Current date: March 9, 2021!
Below is the original note on the inspiration that I had to start this blog, some 12-13 years back. That was when I was tracking some startups and evaluating them. I had not updated this blog much in recent days. And now, the focus would be very different, in any case. At this time, the purpose of my occasional blog post here, would be to discuss and debate a business strategy or an investment idea, for purpose of interaction with other like-minded people.
Hope you find it to be of interest.
The original inspiration from 12-13 years back is as follows:
Attending a Bar Camp, Startup Saturday and the Entrepreneurship Summit, in the last 3 weeks, took me back to 1997-98 days when we were starting up for the first time, with Homeindia.com, along with few other first-generation dot com entrepreneurs in India.
I can see the same energy now, perhaps only magnified by the changes in the economy over these years, the emergence of India as a country to reckon with, the maturity of the ICT businesses, the far larger familiarity of the technologies for students climbing out of their campuses, and of course, the awareness now, about an ecosystem that can encourage entrepreneurship.
There is another change. Me. With 11 years of hands-on Internet experience, there is a larger “intuitive” feel on the industry, there is beyond the romanticism of the business, a better understanding of business realities, of markets, of revenues and results. As one young participant respectfully pointed out, there is the “gray hair” difference.
This has inspired me to start this new blog. To share my 2 cents worth, on new startups that I see coming up. Based only on information that is in the public domain (or shared by the company in public forums), and not based on any private information that entrepreneurs share with me. With an idea to give some new perspectives. Ultimately the business succeeds because of the entrepreneurs and they need to trust their gut. But “outside” views help sometime. And which is what I strive to provide here. With only one goal in mind: to enable the entrepreneur to SUCCEED!!
The Gray Hair Speaketh 