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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Another thing which could work is a fix yearly payment stock trading account. With so many provider coming in market people would surely bet on provider who could take away per transaction commission.
The provider could also make money on individual account management and advice services and interest earned on margin accounts etc. Also organization can interest on loan given to stock traders. Importantly research part from collabrative content generated like forums and blogs is essential due to the fact company like indiabulls or sharekhan and afford to give a dedicated relationship manager for helping users make informed decision. Need to study the model more but with amount of people interested in making money from stock market. Its worthwhile a shot!
Alok:
1. Online DVD rental: Shipping costs (keeping it to bare minimum) are very critical to making this a success. Netflix and others have standard sized packages, for which they have reliable and assured shipping costs from the likes of UPS. Such deals would have to be struck with Blue Dart too. Also returns need to be managed. If there are drop off points, it helps. Such infrastucture is a bit of a challenge at this time.
More than that, in the coming years, do we see a shift to online downloads? Rajshri has launched the service, of course, today targetted for NRIs. But assuming that bandwidth moves fast, and its at least available to those who can pay and want it, then movie downloads may upset the DVD rental applecart. Unless one can learn to quickly migrate to that model. But rights to rent DVDs and rights to allow downloads may be with different people!
2. Online photo printing: The intended recipient has to be the not-so-net-savvy parents or grandparents? For everyone else, there is a FlickR to go and see as many pics as you want. It may be an interesting market. What are likely to be competitive forces? Wal-Mart runs a very popular photo printing service in the US. I believe the likes of Kinkos or UPS Stores (erstwhile Mailboxes,etc) also would be offering the same. They would have already extended to accepting remote printing (I know they do remote printing of documents; they probably do for photo prints as well). These guys are coming here too. UPS Store is already here, Wal-Mart will be here soon. Whether the pure play online photo printing services can stand up to their might is a question. And against that, the whole market size issue also remains. Whether the parents, grandparents market is large enough?
3. Online tutoring – would be a winner, I would believe. Make it efficient with work-from-home specialist tutors. Market size will only increase, good service quality will generate huge viral markets, a student entering at grade I can be a customer for 10 years, and you can keep adding one class each year.. all in all, a great opportunity!
– Sanjay
While we are talking about DVD rental how about another aspect of our social lives – FOOD.
We can order it online, we can order how to make it online, we can order services around it.
Does this make sense?
Sanjoy, I think fragmentation to start with is not an issue, but finally the market structure should allow someone to get 20-30% of the market — I think thats what you also said.
So folks, we have a volunteer in Sanjoy. I dont need to say that VCs would love to fund a business with these economics — and everything else that we typically need 🙂
Hi Sanjoy,
What you mentioned above about post warranty maintenance is happening slowly across the world. There are a set of “Maintenance Service providers” who are coming up in Europe. Same is happening in India as the Enterprises are finding it difficult to manage so many vendors and service providers. So, they are slowly outsourcing their infrastructure maintenance to select “Service providers” who take care of everything.
We are following this model and we are getting traction across the world. We have end-to-end solutions to remotely manage UPS, Chillers, AC, Satellite modems, Generators, Lead Acid batteries, Temperature sensors in server racks and data centers, Humidity sensors, smoke detectors and this list is growing over wired as well as wireless Internet. These are used for manned as well as unmanned locations.