Startup lynch from investor: second issue
Hi, Habr! We continue to analyze start-up business plans that you have sent. After the first issue, we received more than 20 applications, of which our investment analyst Andrei tyche Kulikov again selected five of the most interesting. Of course, this is not all - we still have a few ideas to continue.
This time there were many projects among them that are not directly related to the core business of Fast Lane Ventures - Internet business. However, projects that did not receive email notifications that they didn’t come up still have a chance to appear in Lynch, and the application form still works.
The accumulated mass of data allowed us to deduce certain patterns - general rules, weak points of presentations - and make recommendations that would be useful to read in order to avoid future repetition of typical errors in the presentation of projects.
However, not everything is so sad. Among the five selected projects there are at least noteworthy ones (including Fast Lane Ventures).
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By the way, we also learn from our mistakes, and now for the convenience of reading and reducing the number of beeches in a post, instead of quoting applications, we will simply post links to them. The structure of the analysis of applications is the same: pros, cons, analyst comment, investor's verdict.
â„–1 Price-map.com (site, by the way does not work) - the project is a search engine for price offers with the functionality of city navigation. The business model involves monetization through a subscription.
Full text of the application .
A great idea that does not have strong competitors at the moment (but not “not at all” - look better).
The niche for the local price search is huge - in Russia, because of the cost and duration of delivery, it is extremely difficult to sell goods up to 500-1000 p.: The cost of delivery makes buying on the Internet unprofitable, and the speed of delivery is meaningless.
Proof of concept is obvious to all.
Subscription monetization requires verification: it’s unlikely that you will be able to take the same amount from an electronics hypermarket and a small store.
An important point - as planned to receive prices from stores and update data - was left without attention.
Focusing on additional functionality (route, calculating the cost of travel) is doubtful in understanding a business problem: the most important thing here is to show actual prices and availability of goods close to the consumer.
Yandex is already very active in this niche. See also successful western projects: shoplocal.com, salelocator.com, milo.com, goodzer.com, nearbynow.com, google.com/products, retailigence.com - they have different positioning, functionality and technology, there is something to choose from.
Fast Lane Ventures: we will not invest until we meet a team that can implement this project.
â„–2 Job boards with services and tools to simplify job search and recruitment
Full text of the application .
The project is based on a good approach - an analysis of the functionality that competitors lack.
The cost and terms of development, the described functionality and the achievement of self-sufficiency within 1 year by the efforts of a team of 4 people is an unrealistic goal.
The demand for functionality by a wide range of users also requires confirmation: for example, the video technology of the interview will be available only to those applicants who are currently not working or have a separate room that allows for video interviews during working hours.
The project, in addition to a good idea for the implementation of additional functionality, lacks a business component and a strategy that will make a company out of a set of features.
Fast Lane Ventures: do not invest, the segment is highly competitive, with already established leaders.
â„–3 Sebro - exchange orders for search engine optimization with automatic control of order execution.
Full text of the application .
The project is up and running, in the near future it will be possible to evaluate feedback from the market.
The lack of direct analogues, the opportunity to become number one in its niche.
SEO promotion is not a standardized service; it is difficult to control quality automatically. The exchange system is good for standardized goods and services. Lowering the price in non-standardized products leads to a deterioration in the quality, orientation of the contractor to the “project handover”, and cheaper process.
Specialization in SEO, no related work on content creation, error correction. On the one hand, this can help the service position itself in a narrow niche, on the other - only one direction severely limits the potential revenue of the project due to the finiteness of the target market.
Resolving disputes in guaranteeing payment only for the result (what about the cases of changing the algorithms and other objective reasons for not achieving the result?) Would require a large amount of resources, a commission of 5-10% would not be enough to cover the costs.
Fast Lane Ventures: do not invest; The project can be very good and successful, but it does not interest the institutional investor, for whom the absolute size of the business is important.
â„–4 Aggregator of building materials with GEO-services.
Full text of the application .
The building materials market is very attractive, but is still poorly presented online.
A large number of goods can be bought remotely - you do not need a presence to choose (the client knows what he needs) and delivery (it is almost always carried out by special transport).
The project is aimed at a “prepared client” - the lack of costs for assistance and advice on the choice, fewer returns.
High AOV and frequency of purchases.
The refusal of non-standardized goods will lead to the fact that users will be forced to use other services, and, possibly, will eventually go to them, because to use one “entry point” is always more convenient. Also reduced potential AOV.
The proposed scheme of work solves the problem of the aggregator (to get a commission), but creates additional difficulties for customers. Successful services are successful primarily because they are convenient for both customers and partners, for example, helping the buyer to make orders easier, to get the goods cheaper, and to the seller to sell more.
It is interesting to make calculations, how many transactions and how many goods must pass through the aggregator, in order for the project to be financially successful with a 1-5% commission. The second point is how to attract two categories that are poorly represented on the Internet - SME (your customers) and sellers of building materials. The third point is the choice of a clear project focus on clients (b2b or b2c) and monetization - advertising or commission. The study of successful and unsuccessful Internet businesses in this field in Russia will be very useful for the project.
Fast Lane Ventures: if there is proof of concept business model in foreign markets, come to us.
â„–5 CREW - manually moderated base of people and organizations.
Full text of the application .
Launched a project with good attendance.
The service combines the functionality of different projects: a social network, a b2b-catalog, a billboard - the investor always wants to see a service that has a clear focus. So far, this can be opposed by a successful launch of the project and good attendance, but in the future it will be necessary to demonstrate financial KPI's.
The functionality offered by CREW is available from hh.ru , tiu.ru , professional social networks - there is a risk that their established base and expertise will outweigh the convenience of a single platform (CREW). In addition, a database of people and organizations implies different audiences - you have to balance the functionality, usability and business model.
At this stage, you need to watch KPI's, the economy of the project (whether manual moderation and other costs will justify advertising and paid services) and, carefully listening to the user, modify the service.
Fast Lane Ventures: for us this is an unattractive project due to the blurring of the business model.
PS Subscribe to our blog so as not to miss the next issue of a startup lynch from an investor.
Successes!
This time there were many projects among them that are not directly related to the core business of Fast Lane Ventures - Internet business. However, projects that did not receive email notifications that they didn’t come up still have a chance to appear in Lynch, and the application form still works.
Four rules for successful presentations
The accumulated mass of data allowed us to deduce certain patterns - general rules, weak points of presentations - and make recommendations that would be useful to read in order to avoid future repetition of typical errors in the presentation of projects.
- All applications are superficial. Each business model has its own bottlenecks that are striking. A very general description of business models with the pattern phrases "third-party developers" and "social media marketing" are usually not read to the end - all this has already been seen many times. For inspiration, I recommend to go on a crunch and see an interview with startups founders who have attracted funding.
- Work with the bottlenecks of the project: ask yourself 2-3 key questions that come to mind first thing when presenting your project - and warn them by answering them in your presentation. If you want to make a second hh.ru , then the first question is where from and how the project will attract as many applicants and employers. If you want to make a project on “cones” stuffed with other start-ups - show them mistakes, simple “they haven't tried hard enough” was not enough. Prove that the market actually is, illustrate their mistakes.
- “Sell the team” - the team should be given at least half the attention. It’s not hard to describe business opportunities in general - for the evening, you can figure out which promising topics can be launched in the classic verticals or at their interface. In order to interest an investor, you need to show an opportunity in the market, a business model, a vision, and convince everyone that your team is the best and it will succeed. Process activities “Experience in creating websites” and “X years of work as a freelancer” do not look like a good reason for creating a business. Concrete achievements, experience in creating a business (albeit not successful), understanding the industry will be more convincing.
- Numbers, numbers, numbers - show the scale of the real market (total addressable market) and the potential revenue of your project on the horizon of one and three years. The investor always wants to see the size and growth of the market, the size of the future company, the scalability of the business.
However, not everything is so sad. Among the five selected projects there are at least noteworthy ones (including Fast Lane Ventures).
')
By the way, we also learn from our mistakes, and now for the convenience of reading and reducing the number of beeches in a post, instead of quoting applications, we will simply post links to them. The structure of the analysis of applications is the same: pros, cons, analyst comment, investor's verdict.
â„–1 Price-map.com (site, by the way does not work) - the project is a search engine for price offers with the functionality of city navigation. The business model involves monetization through a subscription.
Full text of the application .
A great idea that does not have strong competitors at the moment (but not “not at all” - look better). The niche for the local price search is huge - in Russia, because of the cost and duration of delivery, it is extremely difficult to sell goods up to 500-1000 p.: The cost of delivery makes buying on the Internet unprofitable, and the speed of delivery is meaningless. Proof of concept is obvious to all. Subscription monetization requires verification: it’s unlikely that you will be able to take the same amount from an electronics hypermarket and a small store. An important point - as planned to receive prices from stores and update data - was left without attention. Focusing on additional functionality (route, calculating the cost of travel) is doubtful in understanding a business problem: the most important thing here is to show actual prices and availability of goods close to the consumer. Yandex is already very active in this niche. See also successful western projects: shoplocal.com, salelocator.com, milo.com, goodzer.com, nearbynow.com, google.com/products, retailigence.com - they have different positioning, functionality and technology, there is something to choose from. Fast Lane Ventures: we will not invest until we meet a team that can implement this project.№2 Job boards with services and tools to simplify job search and recruitment
Full text of the application .
The project is based on a good approach - an analysis of the functionality that competitors lack. The cost and terms of development, the described functionality and the achievement of self-sufficiency within 1 year by the efforts of a team of 4 people is an unrealistic goal. The demand for functionality by a wide range of users also requires confirmation: for example, the video technology of the interview will be available only to those applicants who are currently not working or have a separate room that allows for video interviews during working hours. The project, in addition to a good idea for the implementation of additional functionality, lacks a business component and a strategy that will make a company out of a set of features. Fast Lane Ventures: do not invest, the segment is highly competitive, with already established leaders.â„–3 Sebro - exchange orders for search engine optimization with automatic control of order execution.
Full text of the application .
The project is up and running, in the near future it will be possible to evaluate feedback from the market. The lack of direct analogues, the opportunity to become number one in its niche. SEO promotion is not a standardized service; it is difficult to control quality automatically. The exchange system is good for standardized goods and services. Lowering the price in non-standardized products leads to a deterioration in the quality, orientation of the contractor to the “project handover”, and cheaper process. Specialization in SEO, no related work on content creation, error correction. On the one hand, this can help the service position itself in a narrow niche, on the other - only one direction severely limits the potential revenue of the project due to the finiteness of the target market. Resolving disputes in guaranteeing payment only for the result (what about the cases of changing the algorithms and other objective reasons for not achieving the result?) Would require a large amount of resources, a commission of 5-10% would not be enough to cover the costs. Fast Lane Ventures: do not invest; The project can be very good and successful, but it does not interest the institutional investor, for whom the absolute size of the business is important.№4 Aggregator of building materials with GEO-services.
Full text of the application .
The building materials market is very attractive, but is still poorly presented online. A large number of goods can be bought remotely - you do not need a presence to choose (the client knows what he needs) and delivery (it is almost always carried out by special transport). The project is aimed at a “prepared client” - the lack of costs for assistance and advice on the choice, fewer returns. High AOV and frequency of purchases. The refusal of non-standardized goods will lead to the fact that users will be forced to use other services, and, possibly, will eventually go to them, because to use one “entry point” is always more convenient. Also reduced potential AOV. The proposed scheme of work solves the problem of the aggregator (to get a commission), but creates additional difficulties for customers. Successful services are successful primarily because they are convenient for both customers and partners, for example, helping the buyer to make orders easier, to get the goods cheaper, and to the seller to sell more. It is interesting to make calculations, how many transactions and how many goods must pass through the aggregator, in order for the project to be financially successful with a 1-5% commission. The second point is how to attract two categories that are poorly represented on the Internet - SME (your customers) and sellers of building materials. The third point is the choice of a clear project focus on clients (b2b or b2c) and monetization - advertising or commission. The study of successful and unsuccessful Internet businesses in this field in Russia will be very useful for the project. Fast Lane Ventures: if there is proof of concept business model in foreign markets, come to us.№5 CREW - manually moderated base of people and organizations.
Full text of the application .
Launched a project with good attendance. The service combines the functionality of different projects: a social network, a b2b-catalog, a billboard - the investor always wants to see a service that has a clear focus. So far, this can be opposed by a successful launch of the project and good attendance, but in the future it will be necessary to demonstrate financial KPI's. The functionality offered by CREW is available from hh.ru , tiu.ru , professional social networks - there is a risk that their established base and expertise will outweigh the convenience of a single platform (CREW). In addition, a database of people and organizations implies different audiences - you have to balance the functionality, usability and business model. At this stage, you need to watch KPI's, the economy of the project (whether manual moderation and other costs will justify advertising and paid services) and, carefully listening to the user, modify the service. Fast Lane Ventures: for us this is an unattractive project due to the blurring of the business model.PS Subscribe to our blog so as not to miss the next issue of a startup lynch from an investor.
Successes!
Source: https://habr.com/ru/post/125179/
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