Social Media

Inside a Startup Pivot: Shopcastr

By Mark Evans in Social Media, Startups No Comments Tags: , , , ,

If you’re looking for the definition of a pivot, you probably couldn’t find a better example than Shopcastr. (Note: Shopcastr is a client).

The original idea was Hipsell, which had huge ambitions to change the online classifieds marketplace by letting people cross-post listings on Craigslist and Kijiji in a way that leveraged mobile and social media. After some trial and error, founders Matt O’Leary and Aron Jones realized the concept wasn’t going to work.

Rather than pack up, they decided to take the insight they had learned about local commerce to come up with another approach. In testing a new idea, they did something Eric Ries (aka The Lean Startup) would have loved: they conducted in-market research by visiting dozens of retailers to get feedback on whether the new idea had any legs.

Armed with real-world intelligence, Hipsell was rebranded as Shopcastr, which lets retailers quickly and easily create online stores to feature their products. Consumers can browse Shopcastr to discover new stores and products.

While Hipsell was a sexy idea, it was challenged by a lot of moving parts and entrenched behaviour. On the other hand, Shopcastr is one of those ideas that makes sense. It lets local retailers establish an online presence that can complement their Website or be their Website. And it plays right into the shop local movement by providing consumers with a user-friendly way to discover what’s around the corner or across town.

To get a better idea of Shopcastr, which is part of the Mantella Venture Partners portfolio, I fired off a few questions to Matt O’Leary:

1. What is Shopcastr and when did the idea come from?

Shopcastr is a simple and beautiful way for retailers to show off their best products and let’s consumers window shop their favourite stores from a phone, tablet or computer.

Shopcastr was a pivot from Hipsell, a real-time mobile marketplace. Hipsell set out to disrupt online classifieds giants like Craigslist and Kijiji by building a real-time, mobile, social, location-based web and mobile app that solved a ton of problems in the space. Hipsell had some unique ideas on how to solve the chicken and egg problem a new marketplace faces. One of the ideas was to use Amazon’s Mechanical Turk to cross-post all Hipsell ads to Craigslist and Kijiji. Kijiji quickly shut us down, and then we decided go back to the drawing board and do some customer interviews on a fresh idea with a slight resemblance to Hipsell.

2. Who’s the target audience for Shopcastr?

Independent local retailers with one to four locations is our primary target on the retailer side. We don’t target big box and like shops with unique products. On the consumer side, our target is shoppers primarily from the age of 20-40. 65% female, 35% male.

3. What’s been the reception so far? Who’s signing up for the service?

We’ve had a great reception from retailers. We’re signing up over 20 a week, and now have over 250 shops and 2500 products. Our top 20 retailers post an average of eight products a week. Our early adopters range from amazing furniture stores like Design Republic to bike shops like Duke’s Cycle.

We only started our consumers acquisition methods last week. We debuted at Sprout Up putting on a four-minute presentation in front of 500+ people. In our 90 day beta period, most of our consumer traffic was coming from our retailers existing networks (Facebook and Twitter).

4. What’s the growth strategy? Are you focused on Toronto for now or plan to expand to other cities?

We’re still focused on Toronto as we build our playbook for a multiple city rollout. We’re planning to expand into multiple cities throughout North America in 2012 and beyond. Stay tuned for an announcement within the next few months. In the meantime, you can request a city on our main page.

5. What’s the business model?

Our business model is simple, we plan to charge retailers a monthly subscription fee starting as low as $9/month. We will also have an interesting paid advertising/positioning model that we’ll be experimenting with in the coming weeks. We plan to have an API and have a few other tricks up our sleeve. SaaS with a little bit of Class if you will.

More: The Toronto Standard ran a good feature on Shopcastr earlier this week.

How Generous Should Startups Be with Stock Options?

By Mark Evans in Social Media 1 Comment Tags: , , , ,

One of the many fascinating aspects of Facebook’s S-1 filing for its $5-billion IPO was how it handed options to employees, freelancers and contractors. This included graffiti artist David Choe, who accepted options rather than a few thousands dollars for painting Facebook’s first office.

It put the spotlight on the question about how generous startups should be with option grants.

On one hand, options are an effective tool to motivate and reward employees and people who have helped a startup and/or provided services.

For employees, it gives them skin in the game, particularly given the hours and effort involved. As much as employees may be compensated well, the benefits of giving people even a small number of options far outweighs the resentment of having founders hang on to as much equity as possible.

Options are also a good way to conserve cash because they’re seen as having no value unless there is a liquidity event.

On the other hand, a startup may not want to grant too many options because they can dilute existing shareholders.

At the end of the day, how often and how many options to grant is a balancing act. They can be a valuable corporate tool to drive and support growth. But like anything, there can be too much of a good thing, including option grants.

Shopify Makes First Major Acquisition

By Mark Evans in Social Media No Comments Tags: , ,

Armed with $15-million in venture capital to aggressively expand its e-commerce platform, Shopify has made two big moves – made its first major acquisition – Ottawa-based S3 – and moved into a new 17,000 sq ft headquarters in Ottawa’s ByWard Market.

The purchase of S3 is a key part of Shopify’s efforts to expand its mobile growth strategy, which will see the development of new applications on the major platforms.

A Mobile Company in a Few Years

Shopify CEO and founder Tobi Lutke said the purchase of S3, which was located in Shopify’s old offices, materialized after Shopify realized that an increasingly amount of business was happening using mobile devices.

“There are people on smartphones and tablets, and people sitting on couches makes purchases,” he said in an interview. “We really realized that in a few years from now we will be a mobile company. We did have a mobile application that was good and people liked it but it was tricky because our DNA is building scaleable Web sites, while mobile development requires a very different kind of craftsmanship.”

Shopify has more than 20,000 active online stores in 80 different countries, including more than Shopify’s stores in Canada. Last year, Shopify processed more than four million orders worth $275-million of sales, and more than doubled its workforce to 100 employees.

Tariq Zaid, S3′s co-founder and CEO of S3, will be joining Shopify with his team of over 20 mobile engineers and designers.

 

Extreme Startups Unveils Accelerator with $7M in Financing

By Mark Evans in Social Media 3 Comments Tags: , , ,

As much as Canada’s startup landscape has been seeing more financings (Clio being the latest deal announced), there’s still a long way to go before we have a healthy and robust capital ecosystem.

So it’s good to see the arrival of a new accelerator, Extreme Startups, which is launching with $7-million in funding from Extreme Venture Partners, OMERS Ventures, Rho Canada Ventures, BlackBerry Partners Fund and BDC.

Extreme Startups will have two cohorts of five companies/year. Each company in a 12-week cohort will receive $50,000 (in exchange for a 10% equity stake) and be eligible to receive up to $150,000 in a convertible note from BDC upon graduation.

“There is a great environment with a lot of talent and voracious entrepreneurs, so it’s a great space to be,” Andy Yang, chief innovation hunter with Extreme Startups, said in an interview.

Extreme University Rebranded

Extreme Startups is a rebranded and expanded version of the Extreme University accelerator program started by Extreme Venture Partners. In addition to having access to 29 mentors, the initial cohort will also have Dan Debow, who recently sold Rypple to Salesforce.com, as the “Entrepreneur Link”.

Yang described Extreme Startups’ investment approach as “agnostic”. The focus, he said, will be on entrepreneurs who are the “best and brightest…and have potential for leadership and great products”.

“I would say we’re looking for entrepreneurs and teams attacking large markets with disruptive technology and products,” Yang said.

Another key part of the program will be relationships and access to “leading technology companies and industry pillars”, which will be unveiled soon after negotiations are completed.

Applications open today and close March 1, 2012 for the spring 2012 cohort, which starts on March 15, 2012. Teams can apply at http://extremestartups.com

Snapshot of a VC Deal: Clio Raises $6-million

By Mark Evans in Social Media, Startups, Venture Capital No Comments Tags: , ,

Who: Vancouver-based Clio, which offers cloud-based management tools for the legal industry.

How much: $6-million in a deal led by Acton Capital Partners, a Munich-based growth equity investor, as well as existing investors, including Berlin-based Point Nine Capital, an early stage investor.

The Quote: “The legal space is ripe for disruption,” Boris Wertz, Acton’s Vancouver-based venture partner and a member of Clio’s board of directors, said in a press release. “Although this industry has traditionally been regarded as slow to adopt technological changes, recent investments show it’s now ready to benefit from technological innovations like cloud computing.”

Startup Renaissance or Startup Mania?

By Mark Evans in Social Media No Comments Tags: , ,

As someone who works with startups, the more startups the better. But sometimes it feels like this whole startup/entrepreneurial trend is spinning out of control.

A few of examples:

1. In Chicago, a new downtown hub called 1871 in the Chicagoland Entrepreneurial Center, will open with 50,000 sq. feet of affordable space for fledgling tech startups, along with support services.

2. Meanwhile in New York, there’s a new retail business called the A Startup Store that helps startups gain exposure by giving them a place to tell their stories and display their products.

3. The Argentine startup accelerator NXTP Labs has launched a new call for projects, and startups have until Feb. 21st 2012 to apply. (via The Next Web)

Don’t get me wrong, it’s great to see so much support for startups and entrepreneurs. At the same time, however, I do wonder if it is becoming too easy for startups and entrepreneurs. With hubs, accelerators, incubators and a growing amount of seed capital, has it taken the struggle out of establishing a startup? And is this necessarily a bad thing?

In other words, if there are lower barriers to entry to do a startup, it that a positive thing for entrepreneurs and the startups ecosystem? And if we are encouraging startups, what impact could that have on the supply of talent given there are so many startups looking to hire good people.

I’m a glass-half-full kind of person but it is also important to be pragmatic. Maybe my spider sense is off but it feeling a little frothy out there.

What do you think?

Related Posts Plugin for WordPress, Blogger...
1 2 3 4 5 6 7 8 »