Developing a start-up company is not easy. The path to success takes trial and error, community feedback and expert advice.
Two local start-up companies, MyChange and Sociabile, received community feedback during a forum held at FatPipe ABQ on March 2. FatPipe ABQ provides help connecting start-up companies to potential investors and business partners. Every Wednesday FatPipe’s hosts 1 Million Cups . 1 Million Cups is an event where entrepreneurs present their companies to an audience of experts and community members to receive critiques and suggestions.
“If you are wanting to connect with the entrepreneurial community here in Albuquerque, there is no better place to meet all the different kinds of folks that help grow companies than coming to 1 Million Cups every Wednesday,” said event organizer Eric Renz-Whitmore.
MyChange is an app that rounds up every credit or debit card purchase to the nearest dollar and donates this change to an organization of the user’s choosing.
Eventually the spare change adds up to a significant donation.
“Say you go to Starbucks, you want to get a cup of coffee, that runs about $1.70, we round up [to] 70 cents, and over the course of a month we’ll total all of your round ups and charge your card back,” said MyChange co-founder Eli Il Yong Lee.
Over the course of a month the round-ups usually total $20, or around $200 a year. MyChange keeps 10 percent of every transaction and the rest is donated.
Lee said the idea for the company came from the Supreme Court decision called Citizens United in 2010. This decision states the government couldn’t limit the amount of donations a candidate could receive toward an election campaign due to the First Amendment right of free speech.
“With Citizens United we saw for the first time very large sources of money from a very small number of individuals coming into elections, and that really distorted democracy in America,” said Lee.
Lee said MyChange seeks to remove the distortion from democracy by providing a way for citizens to contribute to funding campaigns or to the progressive cause of the client’s choice. MyChange attended 1MillionCups to receive feedback on one challenge the company faces.
MyChange needs the client’s card number and expiration date to charge a client’s card, which according to Lee is standard practice. But, in order to peer into a client’s account to do the round-ups, MyChange needs the client’s banking account username and password. Many people, especially from older generations, are hesitant to give out this information.
Some crowd suggestions were to feature support from trusted credit card companies on the website or to have a “donate now” button where a client could choose to donate a small sum of money, and only have to enter the credit card number and expiration date.
Sociabile is an app for people who want to use social media but with privacy.
“The trend now is younger generations are leaving Facebook, they’re going to private networks so that way they can interact with their close friends, say what they want to say, just to who they want to say it to,” said Sociabile’s founder and president, Aaron French.
The new social media app allows users to limit their audience to close friends or family, rather than the public.
According to Sociabile’s president, Aaron French, one of the largest problems with social media is the lack of separation between a person’s public image and their private one.
Sociabile is an outlet for people to have a private media account along with their more public Facebook or Twitter accounts.
French said social media is divided into four quadrants: public social networking apps like Facebook; public text messaging apps like Tinder; private messaging apps like WhatsApp and private social networking apps like Sociabile.
According to French, looking at the four quadrants shows the trend that people are favoring privacy in social media. Historically the majority of social media and messaging apps are found in the public quadrants; however, currently, more apps are beginning to be developed in the private quadrants. Sociabile is one of these new apps that has been developed in the private quadrant.
According to French, the majority of private social networking apps have been pioneered in South Korea. He says social media innovations there have superseded the United States. It is his goal to bring their success to the United States.
Another idea French said he brought back from Asia is the use of animated emoticons in messaging. Animated emoticons, which are like emojis, are images users can send to express emotions, French says in Asia several companies makes money off of selling these emoticons to users. Sociabile has the same money-making strategy. For $1.00 users get a set of 18 different animated emoticons. This is different than most current social media companies in the United States, which make money through advertisements.
French said that in South Korea, messaging apps that sell animated emoticons have been successful and have made a stable income off selling these emoticons.
“A lot of the companies in Asia, they’re reporting over $20 million per month, just off the animated emoticons alone,” French said.
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During another recent 1 Million Cups event, Al Davis, of Offtoa Inc. presented a new software that helps entrepreneurs analyze potential business risks as they embark on setting up a new company.
The software asks entrepreneurs a series of questions about their companies. Then, using the answers provided by the entrepreneur, it makes recommendations that help entrepreneurs make decisions and minimize financial risk.
“What it does is it helps to you find out what you don’t know about your company.” Davis said.
Offtoa helps analyze the financial information of companies and predicts how an investor might react to a company’s financial situation. Davis said Offtoa cannot remove all of the financial risks entrepreneurs take, but it can help reduce them. The service gives entrepreneurs an idea of the path that lies ahead.
Equity in the company
Offtoa employees don’t get paid a salary. Instead, they each own a portion of the company and earn equity on their share of the company. Because they still need a steady income, all employees have jobs separate from their work with Offota. According to the company’s website, they are entrepreneurs who want to improve the startup experience.
Davis said the company has no problem turning a profit once it gains customers, but it does struggle to find them. During the event, he reached out to fellow entrepreneurs in the room for help in getting those leads to help the program to thrive.
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