Board of Innovation » broker

Yes, We Are Fans Of Kiva’s Business Model!

Philippe — Fri, 21 May 2010 06:52:14 +0000

As many other entrepreneurs these days, we feel that sustainable development is an integral part of being an entrepreneur. Our aim in this is to support simple but effective initiatives; in the mindset that many small intiatives can make a big impact. In that perspective, Board Of Innovation started to support women entrepreneurs in Asia and Oceania through Kiva loans – Sina Pele from Samoa, and Jocelyn Melanio from the Philippines. We wish them all the best with their plans, and invite all our readers and fellow-entrepreneurs to support entrepreneurs through Kiva as well. Also, special thanks to our business partner Christian De Neef of Fast Track to remind us about Kiva recently. When using the system, I was again surprised about the strenght of Kiva’s business model, and couldn’t resist to visualize it. The 1st flow of transactions shows how loans are given to entrepreneurs, through Kiva’s Field Partners. The Field Partners are in-country based microfinance institutions that approve and disburse loans, and then upload the loan and entrepreneur’s profile on Kiva’s platform.

Lenders like you and me can browse those entrepreneurs’ profiles and choose someone to lend to, using credit cards or PayPal. Unlike other broker platforms, Kiva doesn’t charge a fixed commission on transactions (100% of the loan goes to the entrepreneurs). Kiva lenders choose an additional percentage that want to give to fund Kiva’s costs. The 2nd flow of transactions shows how entrepreneurs repay their loans, and what options lenders have when they get repaid.

The total value of loans made through Kiva amounts to $134,575,785 now. Also interesting to note is that PayPal provides Kiva with free payment processing. Kiva’s is actually the first account at PayPal with a free payment processing agreement. Have you used Kiva or similar funding systems before?

Can You Auction “Exposure” Via Twitter?

Philippe — Tue, 20 Apr 2010 11:22:29 +0000

That is what Auction4Tweets.com intends to do. Increasingly, exposure is a new currency where people can pay with, or get paid for; similar to attention. Previously we discussed Hollrr.com, which rewards early-adopters for giving exposure about new products that they like. Along the same lines, Everyday Models enables you to get paid giving exposure to brands on your clothes, car or online profile; and Posse let’s you promote music events online and get paid for your effort. The different examples show how exposure is a new, valuable currency that can be exchanged for goods, services or cash. Shall we try out the Business Model Drawing Tool? Click on the visual model to go to Auction4Tweets’ editable business model. Sign in at Google if not signed in already, and add your changes, questions and comments!

How does auctioning exposure work at Auction4Tweets? Let’s say I want to reach@nickdemey’s followers on twitter. @nickdemey can auction a tweet to his followers (exposure) for which I can bid together with everyone else. Let’s assume I have the winning bid offering @nickdemey 1000 points. My tweet is then sent to his followers, and @nickdemey gets 1000 points which he can cash for $2. Points are the system’s virtual currency. As you can buy 400 points for $1, yet need 500 points to cash $1, Auction4Tweets seems to take a commission of 20% on each sell (and the remainder of the money which is never cashed out of the virtual currency system). Auction4Tweets launched only yesterday, and probably won’t be the next big thing. On the other hand it’s another experiment in the interesting field of selling attention and exposure.

The business of attention selling: MyAttn.com

Nick — Sat, 03 Apr 2010 17:03:43 +0000

What is the monetary value of one’s attention? That is the main problem MyAttn.com tries to solve. They offer an auction platform to those who have such a busy life that their inboxes fill up to a level that they’re unable to handle the load of daily messages. As a result many emails remain unread. MyAttn gives emailers the opportunity to place a bid for the valuable attention of the receiver. Those who place the highest bids will have more chance that the busy reader will open their emails first. By opening the highest bids, the receiver could make a few dollars. Although the revenue model of MyAttn.com isn’t clear, we may expect that they take a small commission per transaction.

Attention auctions aren’t new. We see them in a variety of industries. But somehow paying for attention feels unethical. In the start-up scene for instance young entrepreneurs pay big loads of money for a few minutes of attention of busy VC’s. This activity, paying to pitch for investors, receives lots of critique these days. But in the end, attention selling in times of information overload remains a ‘good’ business concept. On the other hand, MyAttn.com isn’t the best format to do so.

Flattr.com – a revenue model for online creators

Nick — Mon, 15 Feb 2010 20:52:24 +0000

Already from the visual appearance of this model you’ll notice that Flattr tries to work in different way. Lots of us are enjoying all the free content brought to us by all the individual online publishers. Sometimes you would feel the urge to support these people. To do so you could make use of donate buttons, but still this process takes some effort. That’s where Flattr comes in with their structured approach to micro-donations. As a Flattr client you set your own monthly subscription fee. Then, while browsing/consuming online content, you are able to select your favorite publications. You can ‘flattr’ any type of content. At the end of the month your subscription fee will be distributed over all the people that you tagged (flattred) during that period. Initially Flattr.com will take a 10% commission but they are working hard to bring this number down.

Just like Hollr and Oronjo, this service is looking for a way to help people create their own micro-revenue model. If executed well this system could even replace the outdated business model of ancient royalty and copyright organizations. Without the need for complex distribution algorithms consumers can now pay creative creators directly for the work they consume online. You, and not a centralized monitoring organization, decides where your money goes to. I can’t wait for that day to come.

Broadcast Shopping, a 21th century business model visualised

Nick — Sun, 29 Nov 2009 12:58:53 +0000

Recently Scott Adam described an upcoming new way of doing business. He calls it ‘Broadcast shopping’. The main idea is that potential clients expose their intention to buy on an online platform. Clients can do this by describing their specific need or problem. On the other hand we would find companies that could provide a solution in the form of a product or service tailored to the specific needs of this person. They can send these customers their proposal, but so can other companies. Thereby this ‘request for proposal’ platform creates a reversed auction where companies are bidding against each other. In the end this should result in a better deal for the customer, like a lower price. Looking at the revenue model of such an internet platform, it could make sense to ask for a small access fee or to take a small commission on the actual transaction.
Although Scott claimed this is currently a non-existing business model, we see already the first experiments in the market. First of all these concepts will start in industries where it is worth the effort to start bidding. The margin on a bottle of milk will probably be too low. But within the field of real estate or banking the margins are much higher. Since 2008 the Dutch start-up Moviq.nl is giving homeowners the possibility to put their house up for sale, hypothetically of course. Thereby people can ‘flirt’ and test the market to see what their houses could be worth. Another Dutch initiative, that was only online for a few months this summer, was Spaarbod.nl. On this platform banks had the chance to bid against each other with the best interest rates to persuade individual savers. Although this second example went offline, this doesn’t mean that ‘broadcast shopping’ has no future. Scott is correct when stating that many more of these business models will follow. It will only be a matter of time.

Wraply, a hassle free gift service

Nick — Thu, 22 Oct 2009 19:43:36 +0000

After several very basic business models, it is time for a more advanced example. The problem it focuses on is rather straightforward. When buying a gift for somebody together with some friends, you might run into the hassle of collection money. The start-up Wraply.com will try to solve this with a simple and convenient online service. The person that initiates this group buying process is the main client of Wraply. At first he will have to choose a gift from any e-commerce site. Affiliate shop partners can benefit from extra exposure but will off course need to pay Wraply a fee for this. From that point on more friends can be invited to donate a contribution for the gift. In the future Wraply could take a tiny percentage as commission on these contributions, which could generate a reasonable secondary revenue stream. Once all the money has been collected, the sale will be closed. The webshop sends the product on behalf of this group of friends to the lucky one. In the end all these friends will hopefully give this person a ‘happy feeling’ experience.

Similar business systems can be found in some gift certificate models. As always many players are involved which could make it hard to manage. But in this case, everything is fully automated. This makes a huge difference. Wraply didn’t only take away the hassle for its clients, but also for itself by using this model. Hooray!

Irehab.com: Let doctors pay to give you health care

Nick — Mon, 17 Aug 2009 21:06:30 +0000

The new start-up Irehab.com tries to take a different approach to health care. Patients can get free advice on how to treat specific complaints. By answering a few questions and looking at several 3D animations, these users should be able to diagnose themselves. To treat for instance ‘back pain’ they can follow step-by-step instruction videos made by physical therapists but personally selected by external doctors to fit the needs of that specific patient. The first 10 consults are free of charge, both for the patient and the doctor. On the platform itself, they will have a private area where they can keep track of the results. After the first 10 consults the doctors will have to pay $0.99 for each patient that they want to follow up in the future. For further advice the patient will have to pay a fixed nominal fee per month directly to the clinic or doctor. On average this fee will be around $9.99. The only money that Irehab.com” receives will be the $0.99 per month, so they will need a large database to make this Freemium concept profitable. Within a few years it will be common practice that people will diagnose and monitor themselves without the hassle of expensive expert consults. Many companies are looking for ways to monetize this evolution. Google Health and Microsoft HealthVault are only a few of the large group IT services that are around these days. But also beyond the normal web experience we see these experimental concepts. Recently Apple presented the Lifescan’s New Diabetes iPhone App that communicates with a seperate glucose monitoring device. The latter works similar as the VirtuaGym concept we presented earlier. There people could monitor their offline exercise habits to benchmark these with other peers online. This D.I.Y. health care market is nearly unexplored so you may expect a boom of new concepts and ideas in the coming year. Many of them will fail but some of them will change the way we look at health care forever.

Quirky, get paid to influence product designs

Nick — Wed, 05 Aug 2009 20:05:30 +0000

Quirky, the social product development community, has a very intriguing multi-level business model that shows other web 2.0 projects that money making from day one is possible. Product developers all over the world can submit their ideas to the Quirky platform. Since the posting of these ideas will cost a designer 99 dollar, a first qualitative filtering will be made upfront. The Quirky team itself makes the final selection of which product idea will be produced and sold on the website but they make use the inputs of their online community to support their decision. These users give design advice on the product idea, the brand name, packaging and so on and will receive a small percentage of the 30% profit generated by that specific product idea. Of course also the actual designer of the product will get a share of this profit once the product has made actual sales. To lower the risk, Quirky will only start to produce and sell a product in their webshop once 500 people made a pre-sale of it. If the product idea never reaches this level, the designer will at least receive the marketing data gained of the platform. 99 dollar for these brief insights is still a fair price. Next to the submission fees of all the designers Quirky will gain of course a lot of money out of their webshop , once it will be running at full force. Quirky floats on top of several trends and manages to offer value for all the stakeholders involved. Design influencers win, product designers win and so does Quirky. Where other crowdsourcing plaftorms struggle to find a good balance between trading social currency (influence, exposure, reputation,…) next the ‘normal’ currency (dollars), it seems Quirky got it right. Selling user generated content is not new but this unique approach seems to have enough potential to grow large. Although this sounds promising, Quirky should be aware not to burn their money too fast since they are giving away a few dollars to those who talk about them(*) and to those who fill in a small survey. They do need of course a large community to gain momentum but the investment in new members by offering them 20 dollar (**) is maybe not that sustainable.

(*) Since we’re testing out the service as well, the quirky link in this article has a ‘referral’-identifier attached to it.
(**) You first need to submit a 1 minute survey

Super Chirp Launches Freemium Twitter Model

Philippe — Mon, 08 Jun 2009 19:25:42 +0000

Get paid to tweet! Yesterday Super Chirp was launched as a tool for twitter users to get paid for their content stream. The application allows twitter users to send direct messages to people who pay to subscribe. Adding new vocabulary, a ‘chirp’ is a direct message sent via twitter to a paying subscriber. Any twitter user can sign up for Super Chirp with his or her existing twitter account (unlike twitpub), and set a monthly price between $0.99 and $9.99. Subscribers pay the small monthly fee for a stream of information. Super Chirp keeps a cut of 30%, leaving 70% for the publisher.

We have touched upon twitter’s monetization before with 77 Ways Twitter Could Make Money. Super Chirp illustrates how 3th party apps are monetizing twitter’s free service by offering paid premiums. Why does twitter refuse to enter the arena? From a user perspective, Super Chirp is another new tool for ‘prosumers’ and organizations to earn money. Think of celebrities (f.e. Britney Spears), stock tips, “the funniest guy on twitter”, horoscopes, charity, authority bloggers, early info… Do you have something unique to sell in small messages?

Timebridge: In-App Commerce to Challenge Advertising

Philippe — Sun, 07 Jun 2009 22:03:28 +0000

As previously described on In-Game Selling, companies are moving from advertisement based revenue models to in-app commerce or in-product selling. Timebridge.com is an excellent example of the same principle. Timebridge offers a scheduling service enabling people to collaboratively determine when to meet, also on mobile. Their actual revenue model is the resale of online and phone meeting services. This is not a freemium model, as Timebridge does not sell a premium of its own product. It is not an advertising business model either, since Timebridge is not earning on selling its users’ attention to advertisers. Timebridge’s business model consists of offering its users a free service that serves as broker platform to resell 3th party (meeting) services with commission.

A lot of free products and services go with a freemium or advertising strategy, but advertising is not sustainable for a number of reasons. In-app commerce, or broader, in-product selling is there to challenge advertising. Micro-payments will be a crucial facilitator in getting consumers to actually paying for content again, in times where people are used to free and ad-supported. Like Timebridge, in-game selling, blogs with jobs/widgets/affiliate programs… can your product or service offer a channel to sell and buy things? Sales people earn more than advertisers, don’t they?