We have discussed some of these ideas on venturewoods before, but I thought I would get more specific thoughts. We are seeing more and more businesses around the theme to offer a $100 a year service to a million users. Few ideas that have got discussed here include:
1. Online DVD rentals
2. Online photo printing
3. Online tutoring (export oriented – ok more like 100k x $1000 here)
What are the views around feasibility and scale on some of these? Will these land up being more like 100k x $ 30 plans in the online context? Given that 5-10 startups are starting out at the same time, will the market fragmentation be too high?
Any other ideas that might fall in this conceptual framework?
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Alok,
Are we looking at online photo printing from a “build to flip” point of view ?
Again i see nothing wrong in taking that point of view. The reason i am asking this question is to understand why wouldn’t an idea like this be shot down by a VC for absolute lack of entry barrier, no first mover’s advantage either and obviously low margins. Or Do you see a successful company being built around online photo printing.. a company which can sustain on its own.
Atleast DVD rentals, i guess require strong local (regional) presence and lots of tie-ups and a good team can build some entry barrier. Also in this, logistics is more crucial to the business model than in Photo printing. So having a great operations plan in itself can give a team a huge advantage. But i don’t quite understand how it would apply to “photo printing”.
I believe, of the three ideas you have mentioned only “online tutoring” has a real “value” proposition for a potential customer. It has high switching costs (ppl generally would not like to jump around as far as tutoring in concerned), a deliverable which ppl can actually see (with good performance in schools and growing confidence of children) and a good team can definitely work towards delivering value.
So the question stands “is it build to flip” or ” a good company on its own” ?
– Tax: Personal filing & accounting
Very interesting thoughts. Would be glad to participate in co-developing some of these if there is interest. Rehan, I agree with you on online tax accounting — that could be large — the trick there is to identify a large enough “homogenous” market (tax accounting requirements vary a lot depending on what kind of an individual you are talking to) and go build something specifically for them. When you say VoIP, are you referring to a separate service like Vonage, or just something like skype, or VoIP on backhaul which is already a norm?
Rajan, remote monitoring — are you referring to it as a consumer service or to companies?
An interesting exercise for someone who wants to take it up — take all the ideas above, and map them on a time line for a particular developed market (say US). So on a time axis, what was the market size (in terms of number of subs/users) for that line of business online… Might give some useful insights. Of course, one would have to then apply the India lens to it,
– online tax accounting
– music downloads (will crawl to 1M because of download speeds)
– VOIP
Hi all,
– 24×7 remote monitoring/management of critical devices/equipments over the Internet in a secure manner without human Intervention.
What do you all think ?