With lessons from three startups (for entrepreneurs)
Posted in Authentic Entrepreneurship on January 29th, 2010 by 2above – CommentsLet’s look at the three web services Getsatisfaction.com, uservoice.com and followbase.com, see what lessons entrepreneur can learn from them. If you don’t know about them, Getsatisfaction and uservoice are similar web service offering businesses an easy way to get customer feedback and track them, while followbase is a customer service app via twitter. I personally like getsatisfaction and uservoice, and don’t think followbase can be a lasting success. Following are 5 things I use to evaluate the potential of a startup, including projects I personally involve.
1. Is the market (I am trying to enter) big enough?
Getsatisfaction and uservoice mainly target at businesses with a website, which is pretty much all businesses. Every business wants to hear what their customers think about them, and there were not an easy, affordable way to do it. They come in to fill the space and become a runaway success stories. Now think about customer service, does everyone need customer service? Yes and no. Among all services I buy (cell phone, airline, cable, credit card etc.) I probably call customer service once every two to three months, so it’s not a whole lot for me. It’s probably the case for most of people. If I am targeting at everyone, then the problem I am solving should be more than the need for consumer customer service.
2. Is it a niche problem in a big market that really needs some help?
Getsatisfaction and uservoice are solving a niche problem of a big market (all businesses with website) by offering a feedback forum that websites can carry with them wherever they go and easily get feedbacks. I think that is MONEY! Now let’s look at customer service that followbase aims. I already said consumer customer service is NOT a huge market. But are there opportunities? I think so. Customer service is a HUGE headache or issues for most businesses, more so than to consumers. Each industry is different and customer service can get really complex. A twitter based customer service product like followbase is a good idea, but it won’t solve problems for consumers nor businesses. Businesses need an industry specialized service/product to address their unique problems; consumer, again, unless, they really are passionate about certain market, they won’t care it enough to use followbase. I just don’t care about the pains from cell phone services enough to use another service just to complain; but if I am a x-box fanatics, I would care not only about problems of my x-box, but every move microsoft will make to x-box.
3. Can it be successful trying to cover all segments?
Since most of people don’t complain very often about a particular service they purchased, would it make sense to get all services in one site, so it will address everyone’s problem about every services under the sun? Followbase tries to do that. I think there is a chance, but a small one. They will have chance when majority of brands join it to become one stop twitter customer service central. Can this happen? Possibly. But unlikely, unless the service provided to businesses or brands are so appealing (think about cotweets, which can be appealing for brands or businesses).
4. Think again, are you serving opposite parties? (comcast vs. consumer, e.g.) who are you serving: businesses or consumers? (hence the future business model, and oh, forget about advertising for now)
You tend to answer: I want to serve both. Followbase might think it serves both sides. But I tend to think an early, focused startup with big potential has to pick their focus. You either become service provider for businesses, or consumers, hence you provide value to that party and you can get paid by the party you serve. Getsatisfaction and uservoice serve the businesses with a website, and businesses are glad to pay them for that. Would businesses pay followbase, hardly. But it’s very early for them, they can come up with better killer product be it a destination website, or white labeled service. I know consumer would not pay for that any time soon, unless, unless, it’s industry specific.
5. Real time is not enough, Tweets are not enough.
Most twitter apps are half idle. A few super successful of them includes mobile/3rd party clients, twitter visualization or analytics app such as twittercounter.com, twitter multimedia app like twitpic etc.; twitter search engines such as tweetmeme and topsy.com; (even tweepz and twazzup are trending down). Majority of twitter apps pump live tweets into their app. I have news for you: tweets are not enough. Because most of individual tweets pumped through are out of context and meaningless on the app, apps relying on that either have gone completely idle, or limited by growth potential: I liked stocktwits, cheaptweets, they are profitable, they are great. But how big can they be? Twazzup? Well, they are brilliant engineers, but showing tweets alone with some data processing, featured people, photo, tweets is not enough, it isn’t on the same level with big guys like topsy.com and tweetmeme.
6. Which API should I use? Should I develop twitter app, or linkedin App, or iphone App, or facebook app?
My suggestion is: forget about API all together. Think about your unique vision. Vision comes from expertise, project experience, or just repetitive life experiences about things we go through. Rachael Rae’s vision was 30 minute meal, Jack Dorsey’s was information dispatch, hence twitter; Instead of thinking about what APP you can build with what API, think about your vision and life experiences. That will lead you to the problems or pains you see while others don’t. After that, think about solutions to that problem. Technology comes last.
I write this article to help myself to clear my own mind as well. And I find myself no longer trying to ride certain wave to make quick money, rather, I am focusing on what my vision will lead to. That is more tangible and lasting.
Follow me @theReviewGuy