Market Opportunity, not Magic
Scott Rafer, @E27 Unconference 2009
Losing unique status
Startup Capitals by 2015London + Tel Aviv Beijing + Shanghai
Startup Capitals by 2020?Bangalore
Buenos AiresSingapore
Critical mass
Success builds on founder success
Defining success
Defining two exceptions
Too unlikely
Too little benefitto founders
It’s just math
A few million $ of revenue
A few$ /user/year
Small % penetration in years 1 to 3
Huge audience required
$ * *
$2 * 3% * 50M = $3M
Just for example
Market size matters most
Only China is big enough
English-speaking countriesEurope + Middle East
Latin AmericaSouth Asia
Southeast Asia
*Japan and Korea are different
DVD DRM Regions
Back to Friendster
Capture 1 or 2 regions
Very rough examples to show early scale
$2 * 5% * 200M = $10M
Boring and linear as we like it
$__ * 25% * 200M = $__M
Huge penetration, but multiplying by zero?
$2 * 2% * 200M = $8M
Scaling from Slovenia
$3 * 5% * 200M = $15M
Nailed the model & acquired fast
Copy the German cloners!
Simplicity is all
Be late or be boring
Directories
Customer Lists
Analytics
Assemble and Sell Data
Happy to help as I have time,@rafer