I had the pleasure of mentoring as many of the 19 teams at Startup Weekend Redmond as our limited time and joint caffeine levels would allow, and let me assure you that this intense event is the only thing that could get this Capitol Hill girl over to the suburbs on a holiday weekend.
If I had one piece of advice that emerged from this installment of the 54-hour shower-optional marathon, it’s this: understand the difference between users and customers.
As I sat down with the Carpool Carma team and they described an app that would make carpooling easy, I said to myself (and them): I’ve seen this movie, and it’s called Zebigo. It sounded like they’d be engaging in hand-to-hand combat, battling for one user at a time, and that can be a grueling fight.
- Carpoolers (bless them) are cheap, so squeezing money out of them for a paid app could not just slow adoption, but only eke out pennies at a time.
- Boeing (and enlightened others) actually pay $30 per month per employee to carpool; by effectively tracking and maximizing carpooling, the company can realize tax benefits and can save on parking spaces—so these are deep (and motivated) pockets.
From parking-constrained tech companies in Fremont to Fortune 500 companies in Renton, employers stand to win, and have shown that they will pay for this service. Carpoolers are the users, companies are the customers. Shifting from a business-to-consumer app, to a b-to-b approach, Carpool Carma followed the money to customers who have the willingness and ability to pay, and Ismail and Zillow’s Nick Fitzer pitched their way to best business model. From where I’m sitting, they could hit the trifecta:
- A per-user repeatable revenue stream from corporate customers
- Access to thousands of users (carpoolers) through the employer channel
- Clear return on investment to both parties!
Let me close with a public service announcement. When you have 54 hours to build a demo (or when you’re a resource-constrained startup), focus on your customers’ pain and how much better their lives will be with your solution.
This weekend, a well-meaning mentor insisted that the way to win is to build 2000 twitter followers in two days. My gut is that Boeing won’t care how many Twitter followers Carpool Carma has (as of this post, 15), but that they can save a boatload of money.
And when you create real value, the money will follow.
Congrats to top finishers CarpoolCarma, PEACLO, Beat Machine, SaveGramps and HowBoutCoffee , to all the teams for sheer survival, and as always, to the Startup Weekend Organizers (fueled by Golazzo and the talents of Scott Nonnenberg and Kav Latiolis).
Rebecca Lovell is chief business officer at GeekWire, and a longtime member of Seattle’s entrepreneurial community. She writes occasionally about startups in her column LovelLetters. You can reach her at firstname.lastname@example.org or follow her on Twitter @Lovelletters.