7.5 startup errors. Mistake # 2: My startup is UBER for ... or why can't I describe my startup in one sentence?

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    We continue the series of publications of 7.5 startup errors about the ambitious expectations and big disappointments of entrepreneurs. Today, Daniil Kozlov, Business Development Director at GVA LaunchGurus, talks about the second mistake startups make.


    Daniil Kozlov:

    On July 28, Rambler & Co Holding announced the purchase of AgentOn Real Estate Exchange in order to create its own service for the sale and rental of housing. The new platform in the company was positioned as "Uber for the real estate market."
    The CPUs published a selection of startups with the positioning “Uber for ...” this summer: there we saw Uber for alcohol, Uber for dog walking, Uber for massage, Uber for repairing iPhones, Uber for gay dating, Uber for Tinder and others.

    “My startup is UBER / AirB & B for _________.” I hear this phrase at least once every two weeks.

    The reason is clear. The temptation to quickly and (seemingly) understand the essence of a startup and still make a hint that a startup can be as great as a large American technology company is really great.

    But no! Not! Your startup is not UBER, not AirB & B, and not the What's app for something or someone. And this phrase most likely does not correspond to reality, especially considering that most startups are very poorly versed in the internal kitchen of well-known startup brands and their business models.

    But let's open the topic further, since usually from an expert or potential partner talking with a startup, a fair question follows: why the company is Uber / AirB & B in / for (substitute anything). Almost no one is waiting for this question. Here begins a series of very confusing explanations of how a service for searching, say, housekeepers does the same as AirB & B only with housekeepers (yes, the case is real). Here a slight perplexity arises. But what about the fact that business models are radically different: AirB & B is Peer2Peer rental of premises, and the housekeeping service is a paid recruiting service for finding professionals of a certain specialization.

    And if you tell a similar story to an investor, and if this investor is active, then with a very high probability you have just lost the investor, as he hears such wording regularly. In this situation, such a comparison usually causes nothing but boredom.

    If a comparison with another company is necessary, first sort it out. As an example, I’ll give you one startup that has been accelerating with the juicer project. The juicer collected the whole meal in consumable plastic bags, which can then be discarded. Sense is a new way to get a fresh drink and not to clean the machine. Business model - monetization through the sale of consumables. Where else have we seen a similar model? Right - Nespresso! Therefore, in this case, we can safely say that this business is almost like Nespresso, but for juice.

    There is another option, an attempt to make the name of a scientific dissertation both the name of a startup and a description of what it does. Why this is done is incomprehensible. Business is not a fundamental science. We need names in 1-2 words, vivid, catchy and simple explanations of the essence of business in an accessible language.

    If you tell an unenlightened person that your start-up is “Changing elastic springing during a two-angle bending operation with a flexible rubber stamp” (yes, the case is real) - this can have the most unexpected effect on his unprepared psyche and greatly complicate your further interaction. If the marketing creative does not visit you, then in extreme cases, use a reduction or a few digits.

    Your startup, this is your startup - a separate company, the essence of which you must be able to explain even to your grandmother! Have you heard about Volozh’s grandmother test? Check out, very helpful for comprehension.

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