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User growth and feature enhancements are the building blocks towards the early success of a startup, but as a startup becomes a company, it needs to be able to stand on its own. Monetizing a startup can be a harrowing and heart wrenching experience, since many companies put off these integrations until a product is established, leaving them with little choice but to resort to traditional monetization methodologies like advertising, since any model doesn't fit their current product state, but it doesn't have to be that way. Through working with thousands of startups within PayPal innovation programs and beyond, we have seen how early adoption of proper monetization methodologies can provide you with creative solutions for building a financial backing into your startup, without ever having to resort to hard selling your users to help keep you profitable; the same users who built your product to begin with. Exploring these principles, we'll see how essential creative monetization principles are towards building a strong backbone into a startup, helping it survive the trials of feature and user growth.
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The Profitable Startup
Jonathan LeBlanc (@jcleblanc)Head of Developer Evangelism (North America)
PayPal | Developer
The Problem…
A Relentless Focus on User Growth
The Digital Revolution
Physical Costs
Price of GoodsStorageShippingReturns…
Digital vs. Physical Goods
Digital Costs
…a few bytes
The Problems with the Model
Chargebacks and fraud
Copyright owner concerns
Tracking buyers
Preventing Fraud: Tracking Buyers
Email domain type
User browsing & buying habitsManual review
Device Fingerprinting
IP to billing address location
https://panopticlick.eff.org/
More on Device Fingerprinting
Browser characteristic Bits of identifying information
1 in x browsers with same characterists
User Agent 12.01 4117.11Browser Plugin Detail 6.8 111.13Time Zone 21.6+ 3178409Screen Size / Color Depth 4.56 23.58System Fonts 21.6+ 3178409Cookies Enabled? 0.44 1.35Limited Supercookie Test 0.98 1.97
Mobile as a Primary Citizen
Working with the App Stores
Any product that can be purchased from the app store needs to be
Physical goods are ok – Use a WebView
Construct a wrapper the handle cross-device requests
Working with These Models
Responsive, cross-platform HTML5 web applications
Reduce the number of screens to checkout
Use knowledgeable identity systems
Data Reduction with Identity
Identity to Remove Complexities
Creating with a Crowd
Crowdfunding vs. Group Funding
Many people funding a single individual to perform an end action
Many people funding an end action
Why Crowdfunding is so Hard
Tracking money to its final source
Vetting project owners
Time to payment charge
Handling chargebacks
Very poor history of success
Group Funding Decisions
Short term vs. long term money holding
Direct payment to 1 person or auth /capture model?
Who is responsible for chargebacks / refunds?
Building on a Data Backbone
An Old Addage
"If you aren't paying for the product, you are the product"
Data Responsibility
Personalize, don’t abuse
Anonymizing the data sources
The Problems with the Model
Long time until the data becomes profitable
Narrow data focus area means limited uses
Using our Building Blocks
Optimists consider that up to a 30% of ecommerce sales increase is
thanks to cross-selling recommended products
fikobservatory
Personalized Recommendations
Changing Action to Intent
Traits of the BoredDistractionRepetitionTiredness
Reasons for BoredomLack of interestReadiness
Thank You!
Jonathan LeBlanc (@jcleblanc)Head of Developer Evangelism (North America)
PayPal | Developer