Ask HN: We were told our idea is amazing, but our startup is failing - what now?
Our customers also love our product and the feedback has been extremely positive. We didn’t just ask friends and family - we actually validated our product before we committed to it full-time.
Our startup is in the travel industry, we put a new spin on the traditional travel guide. After many months work, we have finally managed to cover most of the popular tourist destinations in the world. We are making sales, but it's a trickle - nowhere near enough to support us.
Here is an example of our product: http://bit.ly/szvH36
We bootstrapped and have reach the end of our funds. Attempts to get incubated via Chile, YC and Techstars have so far been unsuccessful. We haven't gained enough momentum to approach angels.
I had to go back to contract work to start paying bills, but I am still moonlighting on our startup. My cofounder is going to be in a similar situation very soon.
This is what puzzles me... how is it possible that everyone thinks our idea is good, but we haven't managed to gain momentum?
Any thoughts, ideas or feedback on how to keep the company afloat would be great.
42 comments
[ 3.5 ms ] story [ 62.1 ms ] threadSecond, this seems like an impulse buy sort of item. ( i.e. I'm stuck visiting somewhere new but haven't had time to research it.) A mobile app that allowed quick access to new itineraries via gps look-up might make for a better sales rate. But I don't see anything changing until your price-point accounts for the competition's prices.
So many people will disregard the praise for your site if it's ugly or they can't figure it out.
Edit: A little more food for thought - I opened the page you linked, then went to the homepage, then closed the page. It just didn't appeal to me visually. It wasn't until I saw the comment about charging too much that I even realized you sold something.
So on the cost thing - split test! Run a test between $5 and $10. Seriously. Combine a pretty product with a price that seems just barely over the limit and you will likely find that people are finding your product "re-assuringly expensive". It costs $10 and it's pretty. It must be a high quality itinerary.
I am a freelance web designer and i love helping out startups with tight budgets. My portfolio is at madebyargon.com
Quick question: why is this a website? this seems like information I would want on my smartphone so I could have easy access on the go.
I feel like $4.99 is a reasonable price considering the amount of time it saves you.
What would you consider a reasonable price? Or specifically... what would be your own personal "too expensive" threshold?
My first impression is not "Wow!". Your website design doesn't have that wow factor with it's design. i would highly recommend either getting a design to do some work for you or download a nice design from themeforest.
also there is no way i would pay any money to find an "itenary" because as mentioned below i can just go on google and search for "what to do in xyz?" and pick and choose the ones i like. so personally i would make it free, redo the design and try and make money from the advertisement. maybe down the road you can make deals with certain locations to add them in your itenary for a fee? sell tickets on your site for those locations and keep a commission? either way, charging for an itenary when anyone can just do a google search for it doesn't make sense to me.
Perhaps offer the content free, then work with top restaurants and retailers on the 'tours' you recommend and get them to offer coupons / deals or advertising, of which you can get a cut. People touring a city will get hungry, and if you can point them to a great place, they'll thank you.
I think the value is that it makes the decisions for you. You already have your itinerary set in logical/geographic order.
If I'm running through a city for 2 days, I know I can't squeeze in everything. I can either waste time deciding what to do or I can buy this and see something I know will be awesome.
Not to say that there isn't room for other revenue streams or that other revenue streams may be better, but I don't think direct sales should be discounted before a proper test.
My concern with partnering with restaurants and retailers is that I feel like it's a slippery slope to disingenuous recommendations. Plus, why would a restaurant offer a coupon to a traveler (at least a coupon of value)? There's no chance of repeat business. Just some thoughts, would love to get more feedback, if you have any.
Restaurants might actually be more open to offering coupons to travellers - in a sense, those customers are not repeat business, so they shouldn't be worried about impacting their long term pricing with the local market.
Ultimately, I think you need to focus first on building enough value here with consumers - I don't like to suggest making things free, but in this case I think it's something you have to give away and monetize in other ways. There's nothing bad about that approach (Google does it), but it does require a higher volume of users for it to make sense.
Good luck!
Here's one idea: Give it away but include coupons for each stop on the itinerary. It's Groupon for travelers. Consider offering an app so people can easily carry it with them and it will always be up-to-date with the latest destinations and deals.
My concern with partnering with restaurants and retailers is that I feel like it's a slippery slope to disingenuous recommendations. Plus, why would a restaurant offer a coupon to a traveler (at least a coupon of value)? There's no chance of repeat business. Just some thoughts, would love to get more feedback, if you have any.
Because it brings in business. I see restaurants advertising for tourists all the time. Look in any in-flight magazine or any of the free guidebooks that are given away in tourist areas. They're full of ads and coupons for tours, restaurants, museums and attractions. That's a business model worth investigating.
The downside is it's a real boots-on-the-ground business that requires a heavy investment in sales effort to make it work. The upside is that once you sign up a customer (assuming they have a positive experience) it is highly likely they will repeat. You could start with just one city and if it works grow it from there.
Good luck to you!
You can offer a few different levels of service too: default is web/you print at home. You can offer a full color printed version with the order if you want as well. logistically this is harder but it seems like more of a deal.
There is also the fandango way of doing it too. offer the ability to prepay for the tickets and take a small commission off the top for that. that's tougher to sell to the consumer because you don't have the trust relationship and might leave them stranded at the venue with no valid tickets. It would be slick to have this so that they didn't have to wait in line at all. make it opt in though and let them select what they want to actually go to see/do.
An iPhone app that has everything integrated would be great but it could also be as easy as just an interface for the pdf. If you got it into the appstore you would increase your visibility a bit especially if you target the "what should I do in x" queries with adwords that linked to a specific version of your app. you could also have inapp purchases that would download a new guide. cross selling in your apps is a good thing in this case.
pretty interesting idea. I'd probably buy the sf one if I go there ever but you have to reach me at the right time....
Design is something on our list, but neither of us are designers, and getting a good design will cost a fair amount.
We have tried to provide them in physical format, but the price significantly exceeds that of a travel guide - I'm not sure if it makes sense.
We haven't considered the fandango route - I guess it is a revenue stream that we should investigate.
The iphone app is coming... but its not feature packed, because we had to outsource it, and as always, funds are limited.
Do you get to own the code for the iPhone app or are you beholden to one company for updates?
Everyone could say that the features in your product are amazing. But if you're in a market where customers don't pay, or if you're unable to reach them with the right marketing, then a perfect product is useless.
You have to determine the most profitable segment of your market. And find the cheapest way to market to them. What's the expected lifetime value of a user? Is it less than the cost to acquire that user through Adwords/Facebook? Then run through some ads. And invest some time in learning to optmize the ads.
What are some keywords that people are searching for that would lead users to your product? Are there many people competing for those terms? It might be worthwhile to invest time/money doing SEO. It seems you have a lot of content that might be worthwhile.
You've solved the hard part of having a good product. Now you have to figure out how to market it well.
Because you haven't achieved product/market fit.
For example, you're trying to charge individuals who are traveling - have you explored charging travel-related companies? I could see your app being very compelling for travel agencies, travel book publishers, neighborhood merchant associations, Chambers of Commerce, and businesses that want to advertise to travelers.
To complement that value, your design needs to give a sense of 'here's the distilled gem about this city' - it should just 'hit me'. Instead, I am presented instead with a rather drab plain page, which feels like it'd take forever to get through to gratification.
I'd echo suggestions to look into redesigning the page to make the visual impact, fast.
You also need to learn more about the amount of traction it will realistically take to make a good amount of profit. Even 1000 daily visitors won't do you any good with your current business model. How are you gonna get visitors? You can't just sit tight and wait.
We have a very basic discount/promo system, but building an affiliate system takes time, and we haven't had any requests for it, so it is not at the top of our roadmap.
Trying to build a social community is something we should possibly try, but it will take a lot of time - and we weren't convinced it would catch on.
Let users create their own guides, which they can share with others for free. User generated content can be a huge driver of traffic. Then your business model becomes freemium. Normal users' guides are free, but you pay a little for "expert" guides.
Get professional tour guides on board. For example, in the UK we have blue badge guides who are certified. Getting them on your site will add some credibility.
Make some deals with existing tour companies, either to offer discounts through your site or just a cut of ticket sales.
Have you considered selling your existing guides as ebooks on Amazon or other platforms? Even if you have some awesome guides, I don't know about them because I've never heard of your site. I do go to Amazon to buy travel guides when I'm travelling. If I see your guides show up in the search, I will at least look at a sample on my Kindle. You could do both - have some free guides for promotion and have some cheap ones to make some revenue.
Have you considered selling hard copies of your guides? Most people don't have a way to read a PDF when they are travelling.
Use the Foursquare API to show a "hot destinations" chart on the homepage. Show where people are checking in and link to your guides for those places.
Use buysellads or call businesses directly to place very targeted ads on the site. Affiliate links for tickets and hotel bookings may also work. AirBNB has an affiliate program - ride their success wave.
There are lots more things you could try. The important things I feel are generating lots more content and being creative about distribution channels.
What if you bump the price up to $20+ per itinerary then offered more value by having each itinerary custom made to match each customer's personal interests. Maybe also have the 'local experts' who made the guide ranked like a restaurant on yelp to build up trust.
Unfortunately, so far we have had to seed the marketplace with itineraries which are costing us $100+ each, so we dont have the luxury of making many itineraries for each city.
Also, each itinerary takes many weeks to write - $20 just wouldn't cover the expenses of bespoke itineraries.
It seems like you should test out your ideas on one city (which is much easier to market), then once you find a successful model, start branching out into other cities.
You could spend some money on PPC ads on keywords such as "San Francisco tours", "San Francisco golden gate bridge", etc, and test out different landing pages and different types of guides.
I also think something like this would work better if the information was all free, and people get to rate the quality of each tour. The ones with higher ratings will be shown higher up - maybe offer prizes to authors who have highly rated tours.
Inbound link juice from being featured on a site that's old, trusted and authoritative is 90% of the SEO game. Getting traffic is all about courting and pitching traffic gatekeepers at progressive levels of difficulty/reach, so you might as well start refining your approach.
For an inspiring read on growing your traffic check out "Crush It" by Gary Vaynerchuk, and start getting your content and community hustle on!