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Placense: Seth Godin, Guy Kawasaki and others
February 9th, 2007 by Sir Paul
Finally, the long-awaited summing up of results of the communication with the western (mostly US and Britain) bloggers as well as search for the investments in the foreign funds. These are, certainly, temporary results.
We communicated with almost all the famous bloggers, who write about start-ups, investments in internet. With some of them the communication was productive, but with some people it’s failed due to “I’m too cool to reply to you, guys” reason. As for the angel-funds, we’re not in a hurry to send the project to all of them, as we’re renewing the presentation all the time, we’re improving it taking in consideration the advice of our readers as well as the communication with potential investors. That’s why we’re touching only upon the bloggers now (some of them are venture capitalists, who take decisions about investments). At the moment the presentation was updated with:
- Conservative forecasts of annual income on the basis of promotion costs
- Investment offer
- Worked out cost sheet
- Technical description of the site (a separate appendix)
- Development of the service strategy (partnership program)
- Copyright defense
- A lot of new ideas concerning the development and upgrading of service (we’ll keep it secret for now)
We’re working on recording the demo excursions now.
Okay, let’s be more specific: with whom we had the most effective communication. Blogger Jason Brash ( a successful entrepreneur in mobile marketing and sms content)
suggested moving the business on a mobile basis, gave the contact of his pal, the founder of an interesting start up Erik Schwartz Foneshow. Perhaps we can use the same kind of mobile platform in the future as one of a means of delivery of our product to the consumer.
Jeff Busgang, IDGVENTURES partner
Jeff gave unexpectedly detailed and useful comments. Apart from the others, he not only replied but gave useful advice. We really liked his article “Web 2.0: On Bubbles and Business Models”. The main idea concerning the boom over 2.0 really mirrors our view on the problem. Among Jeff’s key ideas are the following:
- Placense – he thinks it is a good idea and potentially it’s a big market.
- Placequest – he liked it especially. He stated that it would work out for sure. Nobody has ever offered something of the kind.
- One should work and write a more detailed income model. One should stimulate (encourage) permanent and active users’ traffic, to do this one needs to have strong partnership programs..
- The investor must clearly understand how he can multiple his investments, which means if we ask for $200 000, how he can get 2 billions in a couple of years.
- And finally, an American investor will invest in American companies in 99% of cases. The reason is simple: he wants to participate in the project actively and trust the team 100%, and it can only be possible at arm’s length. That’s why the angels don’t invest even in companies in other cities, let alone other countries. He advised to look for the first financing in Moscow, and when the company exists and is actively developing, American venture funds will knock at our wide open doors.
Seth Godin, the ex marketing vice president of Yahoo pleaded busy which we totally believe=)
Another famous guru of the start ups Guy Kawasaki approved of the idea and asked to send the presentation, done according to his “10 slides” model, which I’m busy doing at the moment.
Also we didn’t get reply from 15 people and approximately the same number suggested that we should start a site and recording excursions, which, in their opinion, would take not more than $15.000 – 20.000, which we could find on our own.
Sure we can find this money but we still think that 15- 20.000 won’t be enough to make it the way we want it. We won’t be able to show the investors that we have a popular resource and we won’t be able to attract users or guiders ( for the former we will have too few excursions, for the latter the audience will be too small, then there’s no motivation, and the failure of the project comes next=)).
I also had a very interesting and fruitful conversation with my sister’s husband, CEO of NuvoResearch, a Canadian biotechnological company. He gave me a hint how one can show investors that we’re a good team and are able to develop the service and the product as well as bring it to the customer.
We can choose our niche audience, for example, the clubbing addictants of the European cities (the ones who love snowboarding, golf, whatever) and create those guides with the most famous clubs and “hang out” places with the best music, with attractive party content for them. It would have been a blockbuster if there had been no alternative offer, moreover it’s easier to make effective promotion for the specialized target audience. So, we can judge by one of the focus groups how our product works and what percent of the audience will buy it. As a result, we could turn with the received data to the potential investor, who needs a bright success story to invest in us.
But there is only one BUT!!! Perhaps you could help us here. If the audience is narrow, its representatives actively communicate with each other, thus the risk that the product will spread for free is increasing. This kind of risk is decreasing if we have a big marketing budget and a famous brand (in case of full launch), but it’s greatly increasing in the former case. It’s a little unclear what we can do here!
- We can invest 10.000-15.000 in a campaign like this but will the effect be representative enough?
- How one can avoid this kind of risk of spreading the product for free?
On the whole, we have the following conclusions. Nobody “in the West” needs us at this stage. The people, we communicated with, were all very nice and interesting but still there’s a great gap between us and the globalization won’t help here. Though this work is still a great experience. We keep in touch with most of the bloggers. So, we know now who to turn to if we have a more “clear” to them project.
Now we have only ourselves to hope for (small projects with the help of which we hope to earn money for the launch) and also the further activity in search for the investors in Russia. They are first of all:
- The owners of the tourist agencies and operators (we’re trying to reach them “per aspera” anyhow, though all of them are weirdly hiding =))
- A direct mail to the портфельными менеджерам and the CEO of investment companies relying on their personal investments in this risky but a potentially strong project.
- Perhaps taking part in a tourist exhibition (workshop) can help (if the price of participation is appropriate).
So, working in this direction. We have lots of variants (options), we won’t give up!
That’s it. In a week or two I will post a review of the work with the angel-funds. I have contacted one on the phone already. The others are waiting for the finished presentation.
So, guys, as Johny Walker says “Keep Walking”!
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