I’m in an startup incubator - Week 1: Set up your mind.
— UCC IGNITE 2022 Entrepreneur
I got accepted to an incubator with a weird startup idea.
Is the idea possible? You would ask. How I got in the incubator? You would wonder.
I, myself still fascinating the fact that the idea somehow got people’s interest. There is no secret in this entrepreneur journey, hence, I documented, not just for people to read, but for myself to remember. Here is the story about Kota, a social reading app that allows you to resell your e-books on secondary market, and my journey in an incubator.
Quick brief of Kota.
I’ll explain the whole thing as you might wondering, as did judges from startup competitions and incubators. In this time of writing, it’s April 2022, when you buy an e-book on Amazon Kindle, can you resell it? If not, then what did you actually buy? You just bought a license to read the book, according to the Amazon Kindle policy. So, do you really own the book?
That is also what I wondered and decided to go against what other people are trying to do. Publishers (+ authors) do want to sell a lot of books. Who doesn’t like that? It makes money. With physical books, you can reprint it, so we have 2nd, 3rd, 4th, etc… editions that some of us have multiple copies of (for example, Harry Porter), cause our book might degrade, unreadable. But with digital books, it might last forever, so, people want to have a better way to sell, they fixed your ownership to lease licensing. And it came with a problems, new physical books are expensive, so people buy secondhand books, but with e-book, prices went up and people start to pirating.
And pirating makes authors lose income. So, Kota idea was to help authors keep most of their income, while allow reader to read affordably, one book as a time.
First day, It’s Monday.
Welcome to University College Cork IGNITE program, an startup, entrepreneur incubator, where your idea got bashed again, again, and again, till it refines, or you quit. Sounds harsh?
That’s how steel was tempered.
First day was fun, we did a circle introduction, so you can make acquaintance with fellow founders in your cohort. You got the idea that there are other people out there, had an idea, struggle to make it real. You will also get to learn, through other people ability, experience and mistakes. So, when you are in the same situation, you’ll know, or maybe, got an A/B plan to get out of it.
Second day, what is your business again?
We run through everyone business for over 2-day session. Some questions were asked.
- What problem does it solve?
- And why is it a good idea?
Frankly said, you will start to doubt your idea again and again, even if you already sell. How long will it keep its selling streak? Will your business be there for the next 3–5 years? Are your problems big enough?
To answer those questions, we got an hour session with a market research company, where they introduce how they do market research, why is it important (and a little bit of advertising). Do you know that most common reason why startup fail is lack of market in-depth knowledge?
- One sells their product to a wrong market.
- Someone built a product to solve a problem that so small that nobody cares.
- Another built a product that solved a problem for such a small community that even if he was monopoly, he couldn’t make more than $10,000 a year.
It’s just so common that we always assume one thing that we thought was a must have. Actually, we know so little that when we do research, most of us target the wrong people, in the wrong market segment. Kota was not really much off the scale. We did A/B testing before, but we needed to do more. It’s just not book and comic, it’s boys, girls, LGBT+, teens, adults, etc. We must have a clear understanding of our customer.
A tool that people could use to get an overview on business are the Business Model Canvas by Alexander Osterwalder and the Lean Canvas by Ash Maurya. We can talk more about each other later, though, you might heard other reviews about them so much by now.
The first pair of components we talked about is “Problems — Customers Segment”. Are your “Customer Segments” have these “Problems” that they need to solve? Is your solution, actually solve the problem that these people need and they willing to pay for you to solve it?
Are there any “Existing Alternative”, or ways that they could solve the problems by themselves? And who will be the “Early Adopter” within these group of “Customer Segment” will try it?
It doesn’t matter which side you go to first, you will have to step both left and right foot if you want to go through the door eventually. For Kota, we have a problem that people refuse to solve. Not because the market is small, it’s more that they could not make any money if they do so. You can ask Jeff Bezos if his fortune is enough. When Kindle came out, people were amazed of how they could easily make money with self-publish but didn’t see that most of their profit was taken away by Amazon.
Or is it because our customers are people who in their 18–25 love to read and can’t afford it, so they must resell books to get to read more?
I’m still trying my best to answer this part. Which problem is the most important?
Fourth day in and we got a break.
The last day of the week not just for us to recap on earlier session, but also was for us to sit down, look at our business, tell others about our assumption that we are making and come up with a plan and date to confirm that assumption. Why? I thought people like the idea of digital contracts on blockchain, but some people think otherwise. They don’t like it for various reason. But most of them are not in our target segment anyway. Does it sound cruel when you talk about “future potential customer” in such a way? I definitely need to rethink it. But if they refuse to talk and just block you straight out, they are not well worth to try to reach. In upcoming future, I might hint out why people don’t really like it, but for now, we will focus on why people will use Kota.
Near the end of the session, we name the number that we would like to have after x period. For Kota, I would love to have 10M after 4 years. Will it be nice to have? Yes, for sure. Is it realistic? I will have to try to make it work.
Finally, last words of the week.
Things turn out well enough and it leaves you some guides to follow. I love it, though I rarely play games with in-game instruction (not how to play tutorial). You want to try it out yourself, as the feeling is unstoppable. Just calm down and listen, you will find something unexpected.
Pen down and hope to see you again.
