10 Uncommon Tips for a Successful Startup Marketing Strategy Posted on November 3, 2022December 26, 2022 by Admin While investment in American startups has increased dramatically in recent years, the reality is that most startups begin by bootstrapping their way to success. With increasing competition and limited resources, CEOs and founders of new companies must be more creative than ever. Most VCs, particularly in Silicon Valley, have stated that they prefer to invest in well-expressed ideas and products. Marketing is one of your most powerful tools for getting your startup off the ground and in front of investors. Good marketing can stretch your imagination and allow you to share your vision, mission, and goals with the outside world. Don’t rely solely on Google reviews and banner ads to get where you want to go. Instead, let’s look at ten innovative and uncommon tips for startup marketing. Table of Contents: What Is a Startup Marketing Strategy? Ten uncommon tips for a successful startup marketing strategy (with examples) Understand the product market fit Launch a referral program Create a viral-explainer video Use user-generated content to tell your story Connect for Co-Branding Partnerships Use more than one source of publication Send personalized emails Use your product for a social cause Reach out to the user community Build a reputation What Is a Startup Marketing Strategy? It fits a startup’s limited budget and promises faster growth than traditional marketing strategies. Whether you need quick results or a solid foundation to build your business, this strategy may include some growth marketing plan. In our experience, no startup has risen to the top using only paid advertising or paid partnerships. No matter how many investors it has or how strong its source background is. Most startups do not have the funds to hire an experienced consultant or marketing expert immediately. As a result, it is up to you to determine the best way to spread the word about your startup. Furthermore, the road to success can be difficult if you work with a limited budget. But don’t lose hope; here are a few tips to get you started in the right direction. 10 Tips for a Successful Startup Marketing Strategy 1. Understand the product market fit. This is similar to using your product. If you cannot use your product or believe that another product is superior to yours, your product does not fit the market. Isn’t marketing the process of persuading people that they require your product? People will not bother getting to know your product if you don’t stand out in one aspect or if it isn’t worth the cost or effort. So, how do you know if your product is in demand and will sell well? Easy. Go to Quora.com and look for questions about your product. You can either respond to the questions, contact the people who asked, or introduce your product. Solve their issue. You might also like: Step-by-Step Roadmap to Developing an MVP 2. Launch a referral program. If you want to develop a huge following very quickly, you need to look into referral marketing. This is an essential marketing strategy for startups. Here you allow customers to help promote your product for you. It’s a simple concept, but it isn’t used nearly enough by most startups. PayPal was one of the first businesses to use a referral marketing strategy. And its program is still going strong. Their program helped them achieve an astounding yearly growth rate of over 1,650%. It reached a million users in only two years and grew to a whopping 100 million users in only six years! Image source 3. Create a viral-explainer video. Do you want to generate traffic while encouraging people to buy more of your product? Airbnb shows the unique experiences obtained using Air BnB through an excellent combination of live-action and animation. This explainer video does an excellent job. By demonstrating the benefits of the Airbnb system while verbally explaining them. 4. Use user-generated content to tell your story. Startups typically lack the resources to launch large-scale social media campaigns. A user-generated content marketing campaign is a simple and cost-free way to incorporate testimonials. You can carry out the campaign through your social media channels. And include hashtags to increase your chances of appearing in more feeds. La Croix, like LuluLemon, uses a hashtag (#LiveLaCroix) to mine user-generated content on their social media channels. On the other hand, La Croix relies less on brand loyalists and instead shares content created by anyone, regardless of follower count. Because audiences will see themselves reflected in these photos, their user-generated content will be more relatable. People also liked: Early Startup? Don’t Make These Mistakes Navigating Your First Recession. 5. Connect for co-branding partnerships. If your startup is too small to attract a large audience, partnering with a larger company may be the answer to building a large group of loyal fans. Starbucks built a massive global brand out of a premium coffee shop experience. They used music to create an ambiance around their coffee. Spotify, a music streaming service, has powered nearly 25 billion hours of listening globally. Starbucks and Spotify forged an innovative co-branding partnership to build a “music ecosystem.” They were offering artists access to Starbucks consumers. Starbucks X Spotify Image source Even if you can’t partner with a company the size of Starbucks or Spotify, look for a strategic partnership. It will help you build a brand strategy and gain market visibility. 6. Use more than one source of publication. If you want to promote your blog, you will most likely want people to know about it. You must filter out people who prefer to read or understand the preferences of your people. For example, if you’re going to reach an audience who watches content on YouTube, you must create videos. BigCommerce, an e-commerce website platform, has created a strong lead funnel that uses various marketing channels. You might also like: How to know if it’s funding o’Clock when investors approach 7. Send personalized emails. Making people aware of how you recognize them in a post will boost your credibility. And increase the likelihood of them telling you about your brand and work. You can send personalized emails with an exclusive offer to users to commemorate special occasions and milestones. Such as your company’s anniversary, birthday, or first purchase. You can also thank them for being a part of your organization and contributing to its growth. By combining their users’ travel history, Paravel sends personalized emails. Consider how they use images to connect with users and evoke nostalgia. Source – Really Good emails 8. Use your product for a social cause. If you’re looking for something highly creative that will skyrocket your brand to success, consider using the product for a social cause. What does this look like? It means that customers are able to interact with your physical product in a way that helps a greater purpose. In 2020, beauty and wellness company The Body Shop wanted to thank healthcare workers for their dedication. To do that, decision-makers at the company decided to start a campaign: “Time To Care.” This initiative supports health, wellness, and kindness. Image Source The North American teams of The Body Shop collaborated with shelters. And assisted living communities to donate cleaning supplies such as body and hand soap. Because the company encourages self-care, they wanted to make that experience available to everyone. 9. Reach out to the user community. To build a user base quickly, you must first understand what your user looks like. You can then create content that is specifically tailored to this community. The more precisely you target this demographic, your campaign will be more effective. “72% of customers say they share good experiences with others.” –Esteban Kolsky Lego’s community is an excellent example of community-based marketing. It manifests itself in the form of a web platform called Lego Ideas. Community members can use the platform to share visual ideas for new products and proudly display Lego creations. Members can then vote on specific ideas and comment on them. Source-Lego Ideas If you’re in tune with a large online community, this can be a great way to promote your startup virally. 10. Build a reputation. Building a reputation for being good at whatever your product or brand offers is essential for marketing success. However, because you are an unknown startup with no track record, there is no way for people to know whether they can trust you. What do you do? One way to build a brand reputation is to get featured in a significant publication and build a marketing strategy. The great thing about social media is that it allows you to communicate directly with large corporations and brands. Develop relationships with prominent publications. You can share their posts, participate in their content, and follow their editors. Be genuine and avoid being too promotional. Being featured in a large-circulation magazine can significantly increase your website’s traffic and product sales. The Bottom Line Startup marketing budgets are always limited. Deciding where to spend them can take time and effort. However, as a startup, you can experiment with various marketing ideas without breaking the bank. The tips mentioned above are surefire ways to spread the word and find new leads. But staying current on the latest trends is critical to keeping your business afloat. What Can We Do for You? KiwiTech offers reliable, scalable, cost-effective software development, crowdfunding, and digital marketing services. Our proficient team provides client-centric and business-centric solutions to meet our client’s business goals. We have delivered top-rated marketing services by leveraging our deep expertise, impelling abilities, and proficiency in developing marketing strategies. This helped our clients generate value and revenue. If you have a brand to reach a vast audience or need help with digital marketing services. Please share it with us and get your concept implemented the way you want.
Step-by-Step Roadmap To Developing an MVP Posted on November 2, 2022March 13, 2023 by Admin The prominent social networking site Facebook started as a basic MVP to connect Harvard students. Users were able to post messages on board and interact with one another. Facebook’s MVP proved the platform successful enough to be advanced with more complex features. So if you think MVPs might disappoint your target audience for its lack of perfection? Think twice before jumping onto conclusions. In fact, a 2019 survey reveals that starting small then scaling your software product is critical for almost 70% of all startups fail because of premature scaling. Let’s start from the basics to discover the potential of an MVP in building a successful business. What is an MVP? An MVP or a Minimum Viable Product allows startup founders to build a skeleton or minimum viable version of an innovative product to test features and functions with real users to minimize risk and gather feedback for advancement. However, it is still a launchable version of a software/product that supports must-have features of a product and nothing more. The intent behind an MVP is to attract early adopters, achieve product-market fit and enable faster time to market. The process also involves gathering feedback from early users to steer the subsequent development of the product over the MVP. Eric Ries, who was responsible for bringing MVP to the forefront of startup product development, defines it as “the version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort”. Related: Is your Technology Stack Resilient? The Purpose of an MVP An MVP must be “minimum”, meaning it must take the least effort possible to build. However, it also needs to be “viable”, meaning that it has enough design and functionality to be reliable, usable and considerate of user needs. The purpose of an MVP is to accelerate product launch with minimal risk of failure, based on an established idea and within a small budget and timeframe. With MVP development, startups can rake in user feedback, pull in ideas based on experience and roll out a product that stands all tests. In some instances, an MVP showcases the potential of a business idea and gets investor or stakeholder buy-in. Related: Should You Indulge in Conversational UX for Your Startup? Building Your Minimum Viable Product The problem statement Write down the problem statement on paper. What is the user’s struggle without your product? A problem statement defines the need for the product and how urgent and critical it is for the user to solve it. The more urgent and critical the problem, the more willing users are to pay. Market / audience analysis The more you know and learn about the target market, the better off you will be in business. Conducting surveys and soliciting user feedback is the best way to prevent failure. You may think you have a great idea. But if the market thinks otherwise, your product might struggle to succeed. A pre-requisite for this step is that you know who your target market is, deeply and personally. Market analysis puts you in the users’ shoes to empathize with them while building the product. What’s the icing and the cherry? You’ve now successfully identified the target market and the problem statement. Now, let’s talk about the solution. A simple Pomodoro timer and Trello solve the problem of productivity in completely different ways. In your product/solution, how are you going to solve the identified problem? More so, which features are the cake’s icing and which are the cherry on the top? Prioritize the various functions in terms of their usefulness to the user. Then, consider which are worth adding to the product. Developing the MVP Now, you will begin an iterative development process to build the MVP. The MVP you finalize must be engaging, interactive and user-friendly, as it represents the final product. Be sure to maintain the focus on the primary features. Related: How to Design User Experience for Diversity & Inclusion User feedback stage After you’ve developed an iteration of the MVP, you launch it and gather feedback from the target market. Said feedback is critical for the subsequent development of the MVP and the final product. Revision(s) Now, you integrate user feedback into the MVP. Address and brainstorm over the less frequently asked questions or concerns, too. Sometimes, some users are more in tune with the product and raise excellent questions through feedback. Revise and ship again. 5 Mistakes To Avoid in MVP Development Feature overload One of the most common mistakes when developing an MVP is overloading it with features that aren’t the icing or the cherry. Feature overloading distracts users and fails to keep feedback focused on the most important aspect of the product, delaying product completion and stretching budget limits. So build with the “minimum” in mind. Superficial product strategy An inadequate product strategy (which builds on market analysis, competitive analysis and customer feedback) hampers the MVP development process and even makes it stretched thin as employees busy themselves with building without a direction. Lay down the groundwork before building over it. Large development team Too many cooks spoil the broth. This is a classic example of what happens when the MVP development team is too big. A large team adds overhead costs, slows development and reduces overall performance. Insufficient features in MVP Remember, the “viable” part of MVP is as critical as the “minimum”. This fine balance is hard to strike, which is why many startups fail to launch an MVP that ensures success. Be sure not to leave out any critical functions of your product that make it viable. Low stakeholder involvement A startup always benefits from stakeholder engagement in MVP development. Without appropriate collaboration between stakeholders and developers, an MVP can lose its meaning and go directionless like a chicken without its head. So, involve notable stakeholders through the MVP development process. Yes, we know it can get tricky to know and understand what to include and what not to include when you are developing an MVP, and the task becomes more daunting when you are a first-timer to all this. In such a situation, it is not only prudent but sometimes even necessary to seek help and let the experts take the lead. And what better than the pioneers themselves? At KiwiTech, we have had an exemplary portfolio of startups that have benefitted from our technical expertise in developing MVPs from scratch and doing it with the proper groundwork and strategy to ensure product market fit. Speak to one of our consultants today to headstart your journey for building an MVP!
How to Know if It’s Funding O’Clock When Investors Approach Posted on October 27, 2022March 13, 2023 by Admin Investors approaching you for funding is a good sign that you’re creating the right buzz in the right circles and doing something worthwhile with your business. It’s what some founders dream of, while others see raising funds as a crutch. However, investors coming to you isn’t a sign of your readiness to raise funds. So, how do you know if it’s the right time for you to raise a round of funding? The answer differs for each business. We’ve got a series of steps and considerations for you to figure it out yourself. Related: How Startups Can Maneuver the Current Funding Slowdown When Should You Consider Raising Funds? You’ve garnered enough interest You may still be working on an MVP or prototype but already have enough interest in your product or service. This is a clear indication that you have something that the market wants and that you may be able to accelerate growth with an investment. You have a six-month-long runway Since fundraising doesn’t happen overnight, we suggest you start the process with at least a six-month-long financial runway to last you while you pitch investors, have conversations and secure investment. The idea is to look for funding before you absolutely need it. You could use some support and resources While fundraising gives you access to capital, it also brings expertise and other resources to your business as investors work to get you exposure. If you’re at a point where you could use external expertise from investors and their networks, fundraising can be a smart choice. Related: Raising Capital as a First-time Founder 7 Reasons To Wait Now, let’s see instances where it would make sense for you to wait it out before raising funds. You’re unsure of your scalability There is only so much you can grow without scaling operations. Besides figuring out how to scale your operations effectively, a startup also must discover how to increase their customers without increasing costs. Scalability means boosting revenue while limiting costs. Businesses not dependent on the founder that have a sizable opportunity for future demand are usually scalable. Prepare a plan for scaling your business. Then, look for funding. You don’t have an updated business plan Has it been a while since you updated your business plan as your business advanced? Or did you never create one in the first place? Every startup looking to raise funds needs a detailed business plan with its operations elaborated on it. The plan should also outline your product/service, target market and expected financial growth over the next decade. This provides investors much-needed understanding of your goals and how you plan to achieve them. Your financials aren’t in the green yet If your business isn’t making profits yet, you will have difficulty convincing investors to fund it. Financial performance is critical proof of the usability and demand of your product/service. Not only do you need to make profits in your business before attracting investors, but you also need to present proof of your profits as well. Typically, investors want to look at two to three years of financial statements. Your profit trajectory also tells a story of your business and predicts its future for investors. Make sure you have a good story before you raise funds. You don’t have any strategy execution Building a strategy, executing it, measuring results and tweaking it shows that you are not performing guesswork but making strategized decisions in your business. You need to show that your team has worked the muscle to build and execute a strategy. Having a strategy well-documented means you can demonstrate your implementation, tactics and risk mitigation with the KPIs you’re optimizing for. Investors value it highly. So, document and execute a strategy before you attract investment opportunities. You need to generate more buzz Investors typically don’t want to invest in a consumer product unless there is a long waiting list of people ready to put their money down on it. If you feel you could do more to attract potential buyers, now is not the time to raise funds. Generate that buzz, get more people excited about your product, then start pitching to investors so that there is even more credibility behind your startup. You can continue to bootstrap If you have a long enough runway to continue to bootstrap your startup, you may choose to delay funding. Think about all the resources you need- cash, talent, network and tools. You may have cash available from crowdfunding that hasn’t been exhausted yet. However, if you feel you could do more with added funding, it may be time. Related: Bootstrapping or Venture Capital: Figuring Out the Path for Your Startup You don’t have the time to invest in pitching We all wish raising funds wasn’t as time-intensive as it is. Pitching investors takes a lot of focus, time, effort and money. You first invest in creating a pitch deck. Then, you contact the right investors, schedule meetings, and have many conversations and follow-ups. And it may take some time before things move forward. So, hold off on pitching until you know you can commit the time and effort it will definitely demand. Pre-requisites for Fundraising Arm yourself with knowledge Reach out to fellow founders, investor network, acquaintances and friends who’ve raised before. Ask them about their personal experiences and learnings. Curiosity is your friend. Consult a business attorney Your business attorney holds critical information about the logistics of raising investment. Go over the legalities, apply for patents (if need be) and cross-reference your offering with three major competitors. Gather both stories and numbers Both stories of your startup and its numbers are vital information in raising funds. And they must both match to create a coherent picture. Gather and document all the information you can. Prepare a pitch Before you start reaching out to investors, build a compelling pitch deck that explains who you are, why your business came about, who you want to serve, the goals you want to achieve and how you plan on getting there. Related: Your Guide to Investor Outreach for Startup Fundraising Target the right investors Not all investors are right for your startup. And know that you have the right to choose who you bring to the table. Create a list of characteristics you would value in a potential investor and think this through! At KiwiTech, we help startups secure meaningful funding from expert investors in all industries through our unique and successful access-to-capital program. The program acts as the perfect matchmaker for a startup and its potential. Reach out to us to get started with your perfect startup or fund.
Sustainability and Web3- The Environmental Impact of the Metaverse Posted on October 26, 2022December 26, 2022 by Admin Why Cryptocurrency Isn’t Environmentally Friendly Miners compete on cryptocurrency networks to validate transactions so that they earn rewards. When a miner creates a new block in the blockchain containing a validated transaction, other miners check the information and reject transactions in case of any inconsistencies. The computational overhead of completing a transaction is worrying. The amount of energy to mine a single bitcoin is between 86,000 and 286,000 kWh. For perspective, that’s 59 days’ worth of power consumption in an average U.S. household. Bitcoin’s network consumes nearly 128 GWh a day to produce 900 coins, which is not a good look when environmentalists and consumers are furious over climate change and actively trying to reduce their carbon footprint. And this is only considering DeFi, a part of the Web3 ecosystem, which also includes other power-hungry applications such as AI/ML, 3D video, and AR/VR-powered tools. Another way the metaverse could mess with sustainability is by creating new hardware requirements for users to interact in the metaverse. A high-performing, smooth, immersive experience is part of the deal in Web3. To enable that, companies may need to roll out high-end GPUs as an example. Fortunately, there are alternative power sources for the richer and deeper services in the metaverse, such as wind, solar, hydroelectric, biofuels and geothermal energy. In 2018, as an experiment, Microsoft sank a data center under part of Project Natick to determine if placing a unit underwater would be more reliable and energy-efficient. In September 2020, the company retrieved it and called the project a success. Related: How the Ethereum Merge Impacts DeFi Industry and the Environment 5 Sustainability Steps for Web3 Set climate goals A culture that focuses on trust and transparency can accelerate sustainability. Extensive consumption of non-renewable resources, waste production and carbon emissions are all very real obstacles to the sustainable development of Web3. So, it’s all the more important for organizations to stay accountable for sustainably developing products and services for the metaverse. One way to do that is to commit to sustainability initiatives such as the Science Based Targets Initiative. Reimagine physical facilities The metaverse will generate exponentially more data, which leads to the issue of housing and processing said data in a climate conscious way. While this could lead to the construction of energy-draining data centers, local data centers may choose to move their data to the cloud, reducing the need for more physical data centers. Additionally, large cloud-service providers such as Google aim to run data centers on carbon-free energy by 2030. And enterprises such as Apple and Amazon reimagined their facilities, retrofitting multiple locations with solar and other renewable energy sources, making them run on 100% renewable energy. Review products and their manufacturing The US Environmental Protection Agency defines sustainable manufacturing as “the creation of manufactured products through economically-sound processes that minimize negative environmental impacts while conserving energy and natural resources. Sustainable manufacturing also enhances employee, community and product safety.” The goal is to track a product’s timeline (production, distribution, usage and end-of-life phases) and consider the environmental impact at each stage, which can be employed for both digital and physical products in Web3. Build a circular economy Electronic waste often ends up in landfills and pollutes soil and groundwater. Builders of the metaverse must be mindful of the disposal of products by implementing recycling programs or with product take-backs to recycle old hardware and mitigate risks associated with the irresponsible disposal of hazardous material. Education & accountability for suppliers Annual sustainability reports can help foster transparency and accountability in sustainability initiatives by measuring important KPIs. Supply chains in Web3 can be substantial and complex. So, sustainability reports must include suppliers. E-learning programs and training suppliers on the wide impact of sustainability can strengthen supplier relationships and create a far wider impact than only focusing on internal operations. Related: Blockchain for Sustainability How Metaverse Could Build a Sustainable Reality From physical to digital products As per a recent survey of nearly 5,700 consumers in the U.S. and Europe, those more likely to purchase sustainable products are also more than twice as likely to shop in the metaverse. Metaverse companies can substitute resource-intensive real-world physical goods and experiences with digital and virtual alternatives. For instance, if consumers buy virtual denim for an avatar instead of physical denim, they’d save carbon and water. 21% of consumers intend to buy fewer physical products in the future. Overcome behavioral barriers to change Short-term bias prevents humans from perceiving climate change even when it’s happening rapidly. As VR environments provide users with three experiential dimensions, namely presence, immersion and embodiment, the technology can be used to offer an experience of what the climate will look like by 2050 or 2100. This would make humans care a bit more about climate change as they experience what it feels like in real-time. Social sustainability- inclusion and equity Environmental sustainability isn’t the only focus in the metaverse. Social sustainability presents an opportunity to design the metaverse for inclusion and equity among stakeholders and users right from the start. How the metaverse can become diverse, equitable, inclusive and accessible isn’t a question with one answer or responsibility in the hands of one person. It’s an intention that will require broad and diverse collaboration between businesses, regulators, academia, investors and civil society organizations. However, the opportunity is here. Meeting virtually to save travel emissions The pandemic brought air and ground travel to a halt. Now, U.S. spending on corporate travel is only expected to reach 65%-80% of pre-pandemic levels as consumers and organizations learned that videoconferencing was good enough for many purposes. Metaverse would enable events with the ability to interact and collaborate in ways not even possible in a ‘live’ gathering- minus the time, complexity and expense of travel- a win-win-win for organizations to save money, people to stay put and the climate to benefit from fewer emissions! Status symbols can go digital (Forbes) Status symbols are ingrained in humans who grew up in capitalist democracies and range from owning a house, driving a sports car, sporting designer sneakers or having a private jet. Scientists have proven that affluent lifestyles substantially harm the planet. Metaverse offers to take status symbols to the Web3, still allowing affluent people to build their status while lowering environmental harm. Related: What You Should Know About Regulations in a Web 3.0 World The metaverse makes many promises to help realize a more sustainable tomorrow, be it digitally. To build on your sustainability idea for Web3, speak to one of KiwiTech’s experts today.
Early Startup? Don’t Make These Mistakes Navigating Your First Recession Posted on October 20, 2022December 26, 2022 by Admin Defining U.S. recession by the numbers The U.S. has had consecutive quarters of a slowing economy, with the real GDP (seasonally adjusted annual rate) decreasing by 1.6% in Q1 2022, by 0.6% in Q2 2022 and 0.1 percent in Q3 2022. If we follow the traditional definition of a recession, which is two consecutive quarters of negative growth, we can agree we are in the midst of a recession. The reasons behind the recession are a high global inflationary environment, a prolonged war between Russia and Ukraine, global supply chain shortages in semiconductor chips and dwindling advertising spending. A Bloomberg survey of economists says the median probability of a recession over the next 12 months is 47.5%, which stood at 30% in June 2022. While economists continue to discuss and dispute the economy’s state, businesses and consumers have started feeling the effect of an uncertain economy. From cautious spending due to inflation to VCs playing safe, it’s time for businesses to think forward, prepare, plan and use this time not just for survival but growth. Big Tech Feels the Effects of Recession It helps to consider how the biggest tech firms are navigating and responding to the recession. Meta recently became the latest Big Tech firm to pause hiring and kickstart subsequent restructuring. This is a first for the giant. CEO Mark Zuckerberg called it an end to an era of rapid growth at the social media company. During a Q&A session with employees, Meta CEO announced that the company would reduce budgets across most teams, even those that are growing and that individual teams will be responsible for handling headcount changes. Meta’s decision follows other Big Tech firms, such as Apple, Google and Microsoft, who also froze hiring and started handing out pink slips to rationalize costs and maintain operating margins. Now, let’s see what your startup should and shouldn’t do to navigate the recession and come out further ahead than before. Mistakes to Avoid in Your Startup During a Recession Assuming user needs – re-evaluate instead. Successful startups that want to stay successful through the economic downturn must fill the gap between the market’s current requirements and future needs. In an uncertain economy, it’s highly critical that you take another look at user needs as they change. If changes in the economic environment affects user behavior, sentiment, consumption and purchasing power, are you meeting the new demands? Spending too much – maintain a healthy runway. During healthy economic growth periods, supply is abundant and investments are available. However, during a recession, this changes. Businesses must consider securing funds before a potential downturn and budgeting to balance potential revenue and cost to maintain a sufficient runway. With less funds to go around, now may be the time to zero in on expenses and cut back where you can. This can also be a good time for startups to set quarterly budget reviews and hiring assessments. As a savvy founder, also note that investing in efficient growth is key. Continue to put money down on key business priorities. Not communicating – don’t leave room for assumptions. Economic downturns are challenging times for business founders/leaders and employees alike. Employees look toward their leadership to make sense of what’s happening at all times. Without proper communication, panic and uncertainty ensue. During this time, keep your employees informed and in the loop on business decisions. Moreover, keep your customers, partners and potential investors informed of your accomplishments, progress and how your offerings will impact them positively during and after a recession. Focusing excessively on the downturn – the customer’s success is still your North Star. Focusing on the downturn can distract your focus from running a business. Create a tight bubble around your business and, more importantly, around your customers’ success. Inflation impacts customer budgets, so startups must ensure they bring their customers solutions and fulfill their promises. Centering yourself around your customers will also help you anticipate their challenges and build to solve them. Overall, focusing on the customer can help you attract new customers and retain ongoing ones, no small feat during a downturn. Hitting the brakes on innovation – innovation is required. Venture partners believe that markets are won or lost based on what a startup does in a downturn. Technology leaders at startups need to ensure their company keeps prioritizing technology during the downturn or risk falling behind. Areas such as cloud, cybersecurity and automation are hot right now, attracting active investments. As CIOs and businesses continue to put money down on those areas, enterprise tech startups lean in to meet the demand. In summary, growth opportunities remain huge amidst economic turmoil. Now that you’re aware of the mistakes to avoid, let’s see how technology makes startups recession-proof. How Technology Investments Recession-proof Your Startup Technologies such as AI/ML, the Internet of Things, Blockchain, Cloud computing, and Big Data have revolutionized businesses and the world. They have introduced low-risk and high-reward business ideas that allow people and businesses to flourish during an economic downturn, proving that technology can make your startup recession-proof. Think about Zoom during the pandemic. Technology reconditioning Technology reconditioning is the phenomenon of meeting a user’s need at a lower cost by employing technology. With tech enablement, startups can take an area where consumers spend heavily during healthy economic times and meet the same need at a lower cost during turbulent times. For instance, a startup can make cheaper versions of smartphones and gadgets available during a recession, knowing that customers easily switch devices every couple of years. With reconditioned products, such a startup can meet user needs in a slow economy. How can you use digital transformation or technology for reconditioning what you already offer to make it more affordable? Solidify customer relations Worldwide IT spending is expected to reach $4.4 trillion by the end of 2022. So if you’ve been wondering if you should cut back on your IT budget, think again because your competitors may be doubling down. Many companies reduce their technology investments during a slowdown only to notice everyone else hasn’t and are better for it. Technology helps solidify customer relationships, personalize the customer experience and serve customers better. How can you offer your customers better and more of what they need? That could become your anchor during turbulent times. Enhance efficiency Instead of cutting down team size and budgets, startups must find ways to enhance internal processes so that less time and money are spent on the mundane and more on high-value processes that directly affect the bottom line. For instance, if a company still uses a traditional method to maintain customer information, it may be holding back customer service teams from serving queries and complaints effectively. With modernized technology, customer service teams can read into each customer’s behavior and profile, proactively address issues and maintain a high level of efficiency, resulting in lower costs. Leverage technology to improve efficiency and keep up with the competition during a recession. Boost sales and productivity Investing in technology to improve sales and employee productivity can directly impact your bottom line. It’s one of the best ways to retain top talent and limit turnover in an uncertain economy and the era of The Great Resignation. Assess your sales challenges and enable better data ownership through technology, such as Enterprise Resource Planning apps, productivity tools and better data democratization. Integrate otherwise fragmented data sources to harmonize access to data across the organization, which readily improves the availability, quality and accessibility of insights for sales teams, allowing them to do a better job at ensuring your business’ success. Disruption-proof your business Technology resilience boosts your chances of becoming disruption-proof. Cloud solutions ensure business continuity. AI and ML ensure low error and high productivity, and the IoT makes seemingly disparate data sources coherent and leads to several use cases in industries. When continually upgrading your technology stack, you remain competitive in a grim economic condition. Moreover, all your progress is visible to customers, investors and partners, who come to believe in you because you apparently believe in your vision enough to invest in it. Also, technology brings scalability and agility, which are critical in times like this. 3 Recession-proof Tech Startup Ideas Healthcare innovation A sector that thrives no matter what is healthcare. People continue to require healthcare services no matter what happens with the economy. So, spending on healthcare services doesn’t go down as much as it might in other industries. However, this doesn’t mean consumers don’t become conservative here, too. Consumers of healthcare services still protect their wallets when the economy is tough. But, if a startup offers health solutions that can make consumers’ lives a bit easier during a downturn, they won’t shy away from spending their dear bucks. These tech-savvy solutions can revolve around telehealth, immunotherapy, PoC diagnostics, artificial intelligence and remote patient healthcare. Using technology, startups can lower costs and improve the accessibility of healthcare services during a slowdown. Remote work apps Some statistics show that by the end of 2022, 25% of all North American professionals will work remotely. Since the pandemic threw businesses into the whirlwind of remote work, people and businesses have realized the benefits that come along with it. The trend is ongoing even as the pandemic subsides. Therefore, startups that can enable professionals to effectively work in a remote setting can become recession-proof. This list of startups could include project management solutions, knowledge-sharing platforms, productivity management tools and remote communication platforms. SaaS tech In Q2 2022, enterprises continued spending on cloud infrastructure services, which reached $55 billion. The market experienced a growth of 29% when compared to the last year. Meanwhile, Google’s revenue from cloud stumbled a bit from the expected $6.41 billion to $6.28 billion in Q2 2022. So it is evident that macroeconomic changes do reflect for cloud services, as well. However, overall, the SaaS model of services is resilient to economic downturns if a company survives through to the end. Customer retention is a critical metric for SaaS companies to measure performance, but it becomes more critical in a recession. So to improve customer retention, SaaS businesses can release upgrades, add new features, improve software performance and address any user need to keep users paying. Finally, SaaS businesses must conduct comprehensive exit surveys to gain insight into what they can improve to keep customers. No Winter for Tech-Savvy Startups The “firehose of money” pointed at tech startups may be drying up, but there is a huge opportunity for tech-savvy startups. Companies such as WhatsApp and Instagram were built during the 2008 recession. Technology startups and startups who are savvy in using technology to deliver their offerings will come out farther ahead than their competitors. It’s natural for startups to tread cautiously during an economic downturn. However, being too cautious may mean missing the opportunity to innovate, reinvent and grow. So, buckle up and get down to business! KiwiTech is an active participant in creating the startup ecosystem in the U.S. Find out more about our startup program, technology services, and events on our website to guide you best even in these recessionary times.
Why Build In Web3 Posted on October 18, 2022November 29, 2022 by Admin How Tech Giants Became Giants Platforms and companies that won and came out far in front in the era of Web2.0 could do so by aggregating user data. These tech giants grew more powerful, and so did their ability to provide unmatched personalization and customer experience. When users sign up for services in Web 2.0, they submit their data to intermediaries to accomplish anything. Once that is done, the user has little to no control over what happens to their data and how it will be utilized. Tech companies closely guard their secrets. And, even if a user deletes their account, there is no way to ensure that their data gets wiped out, too. In recent years, through massive data breaches, consumers of Web 2.0 realized that their attention is the currency and perhaps their data. Services such as Google, Facebook, YouTube and Amazon that are free to use are leveraging user attention and data to make money elsewhere. For instance, Facebook (Meta) tracks user behavior data to fine-tune its algorithm to an extent where its ad targeting and content feed are dramatically more efficient than any other social platform’s. The tech giants of Web 2.0 became so because they held control of user data, locked it in and leveraged it to create a competitive advantage. The disadvantage for users is that even if they are dissatisfied with a service and how they handle their data, there is nothing they can do about it. Related Reading: The Next Evolution of the Internet: From Web2 to Web3 Is There a Better Way? Web3 proposes a better way. Instead of exploiting user data to make money, Web3 takes on the approach of building open platforms that share value with users to create more value for everyone, including the platform. In Web3, users own the content they create as well as the data and digital objects they purchase throughout their engagement with Web3. A key part of Web3 is the blockchain-powered sovereignty of data, a reason why Web3 is also called the “creator economy”. Many issues with Web2 came down to the concentration of power and lack of representation and participation in building and using its tools. Web 2.0 companies were built to make profits so that customer experience and needs came second. One may argue that even a majority of Web3 builders are the same as Web2 developers. However, unlike Web2, it is easier and more accessible for anyone to build for Web3. Related Reading: How DeFi and Web3 Could Shape the Future of Finance Web3 Proposes Portable Data Digital assets for the Web3 economy are typically created as per interoperability standards on public blockchains instead of being privately hosted on a particular company’s servers. This means that these assets are portable. A user can leave a given platform whenever they want to by unplugging from the app and moving elsewhere, along with their data. This ability for users to walk away with their data is fundamentally different from how their data is handled in Web2 and can introduce a healthy competitive pressure for services and platforms to do better continually. How Interoperability in Web3 Enhances Digital Experiences If a platform doesn’t offer a preferable digital experience, users can simply move away from it. In Web3, new market entrants can incentivize high-value users to move to them. For instance, the NFT trading platform LooksRare, built by anonymous founders, challenged an industry leader, OpenSea, to produce $307 million in protocol revenue within 30 days of launch against OpenSea’s $110 million over the same period. LooksRare used the vampire attack strategy for its launch. Vampire attacks are a crypto/Web3 phenomena that refer to a method to suck users from an existing platform by offering a lucrative incentive. The dynamic of Web3 is less zero-sum (one person’s gain is equivalent to another person’s loss), so the overall value creation opportunity is huge. If platforms build on an interoperable layer, they can plug into broader content networks, expanding the scale and diversity of value they can offer users. Web3 Offers Trust The cost to create user trust is low in Web3 as the underlying technology is blockchain. Digital assets are managed on public ledgers so that users can clearly see which assets exist and who owns them. If an artist claims that an artwork is limited to 400 editions, then prospective owners can identify and verify the information on the blockchain directly, without having to place their trust in the artist or an intermediary organization. Even software that runs Web3 platforms is inherently trustworthy as key operations are encoded as smart contracts, which automatically execute when certain conditions are met. Smart contracts are auditable and immutable, allowing a platform designer to commit upfront to certain design features, such as royalty agreements and pricing rules. Related Reading: Web3 and Metaverse: Key Challenges Unknown Entrepreneurs Can Leverage Web3 All these features mean that it is easier for unknown entrepreneurs to create for and launch in Web3. Entrepreneurs can create products that plug into an existing network without needing permission from an established platform. However, plugging into a network does not guarantee success or user engagement. Entrepreneurs still need to build a product that solves a user need. Once a founder has that, they can leverage established networks and easily deploy and scale their offering. Is Web3 Safe and Accessible to the Regular Internet User? Several malicious actors have emerged on Web3 to leverage the hype and high volume of transactions on Web3 to carry out scams. Many Web3 experiences of today were meant for the more tech-savvy power user and not the ordinary user with limited to no knowledge of vetting source code. There’s still a long way to go before Web3 applications can be securely rolled out to the general public. Web3 Turns Users Into Fans Web3 applications hold the potential to unlock a special network effect by making users feel like part of a community invested in its success. Owning digital assets leads to a sense of psychological ownership, making consumers feel like the product is almost an extension of themselves. SushiSwap, a fork of Uniswap, set up a strong brand and community with an active reward system for users to drive high engagement and positive sentiment about the platform, quickly emerging as a successful competitor of Uniswap. Web3 can unlock a more valuable, trustworthy .and fair internet for everyone. If you’re looking for consultation or implementation around your Web3 idea, KiwiTech’s Web3: Center of Excellence should be your go-to place. Our free initial consultation with experts can instantly put you ahead of the curve in this booming industry.
Creating a Marketing Funnel That Converts Posted on October 13, 2022December 28, 2022 by Admin Behind every outbreaking cover story that takes the world for its creativity or even that eyeball-grabbing hoarding, there is a humble plan that defines and secures that marketing campaign a timeline. What seems like pure creativity is actually the product of hard work and strategic planning, keeping the efforts and numbers aligned on a single page. Dynamic as it is, marketing campaigns should be flexible enough to change with time but also strong in their execution to last for years without losing effectiveness or momentum. A Poet & A Killer As David Ogilvy, the epitome of marketing and business, puts it, a great marketer is both a poet and a killer; that is, they have a deep understanding of their craft as well as a creative vision. Following the same steps, our crowdfunding ninja, Jeff Wenzel, plans and helps startups raise money and grow their businesses with the help of his experience and expertise in the domain. He has created and managed over 140 fundraising campaigns on multiple portals and continues supporting startups to achieve their dreams with his “no excuses” attitude. While he keeps busy with his goal to help as many startups as possible achieve their dreams and do whatever it takes to make that happen, he has spared some time to spill some secrets on marketing in our Startup 808 Series: The Entrepreneur Workshop.Click here to watch the entire video sessions The entrepreneur workshops are a great way to get helpful tips and tricks on how best to navigate your startup’s obstacles. These events also allow you to network with other like-minded entrepreneurs! Jeff begins by addressing the elephant in the room; with so many ads already out there, you only have 3 seconds to grab your customer’s attention. That is why it’s important for an ad campaign to not only speak with them but also come across as witty and interesting to gain further clicks! Marketing Budget: Know How Much You Need To Get Started First things first, as goes with any strategy, viable forecasting from the pattern of events is a must. Therefore, a deep analysis of the historical sales and marketing data is a prerequisite to any activity planning. QUICK MATH You must be wondering what math has to do with marketing, but when it comes to business, you can not afford not to do your math. If we talk about Ads based on a pattern of clicks, conversion rates, and open rates, you can easily determine your marketing budget. For example: If your target is to raise $50,000 and the price per unit is $99, you may require almost 55 people to buy your product. To convert these 55 people into customers, you must target people according to the general open rate and conversation rate trend. And voila, you can then estimate the cost for people watching and have a budget for your campaigns. A plan in action gives direction to your efforts. It saves you from spending on something that is unnecessary and keeps track of what is working for the company and what is not. It keeps everyone on the same page- from the creative ad agency to the social media intern to the sales reps. “Your marketing strategy should be a living document you regularly review and adjust as needed. Life moves fast, and your plans must move with it.” – Jeff Wenzel. Marketing is a journey, not a destination. From your buyers to your campaigns, they all have a journey to make with a common goal to achieve. Hence, it becomes essential to understand your customers’ journey and discover how you can be a part of it. You have to handhold your customer into taking this leap of faith and make them reach their destination. BUYER’s JOURNEY -Unaware Find your market and dig deep into it. The first and foremost stage is to make noise, and create awareness for your brand and company about why you do it, how you help, and lastly, what you do. For a B2C market, Jeff suggests viral giveaways have proven to be very rewarding as these giveaways make way for direct leads, which could also lead to referred leads. -Lead Once they know you and people are talking about you, it’s time you check whether they are a good fit for your business. He suggests using the Dollar Strategy to validate the interest of the leads. Asking the people to put a dollar into the campaign to reserve a spot shows intent. It shows that these people are genuinely interested in your product or service rather than just being here to win something for free. -Prospect Once you validate the lead, it is time to turn that lead into a paying customer or a prospect. A great way to do this is by using softwares like Mailchimp or LeadPages, which can help you nurture these leads with drip e-mail campaigns and content upgrades. Once they are in your ecosystem, they can be marketed directly.Ads are the easiest way to get data points from your potential customers. Generally, Google and Facebook have pre-populated user data that can help get important details like e-mail addresses, etc. -Customer The journey comes to the ultimate fulfillment only with this step. You have kept in touch with the prospect, nurtured the leads, and now the prospective lead trusts you enough to invest in your product or service. They become the CUSTOMER everyone is looking for. -Fan While the goal could have met, the journey has yet to end. For a business to run well, you need not only to think about the immediate results but focus on the long-term ones. To further your organic sales through referrals or recommendations, you need to build that extraordinary personal relationship with your customer. This effort will make them fans of your brand, enticing them to buy themselves and get others to buy repeatedly. Jeff implores on this basic buyer’s journey to becoming the marketing funnel behind all his crowdfunding and marketing campaigns. Further ahead, he shares some key highlights from a compelling career in this dynamic field called marketing. Let’s dive right into what goes into the head of this crowdfunding ninja: Multiple Strategies Fair Better Marketing is an ongoing mission with continuous interventions based on results. Adopt whatever works for you, leave what doesn’t, and most importantly, be ready to switch from one strategy to other. For example: For a B2C market, Ads run on Facebook are a great way to generate leads as it provides a frictionless way to gather data points through pre-populated automated information. It costs the lead nothing and saves them time. These data points then serve as your entry point for email marketing. Conversational Marketing to the Go Talking to a customer is the best way to understand what a person wants. In the current marketing world, having one-on-one conversations at scale has become easier. This feature is made possible by incorporating Chatbots can be a great way to further your conversational marketing and keep up with attending to every query. They help qualify the leads for you in real-time so you can focus on what matters- sales. Give Your Brand a Personality People don’t interact with brands; they interact with people. Real people generate connections, are built well, and can last a lifetime. Personal, tailor-made content targeting the right audience makes a lot of impact and is advantageous for building a strong customer base. You are good to go even if you focus on 2-3 relevant channels to post your content. If you want to extend this personal connection, you can also give your chatbot a personality to make the connection more humane. Tools Can Take You a Long, Long Way Marketing & Tech is a holy grail combo. Marketing, like any other profession, has its own set of tools. Using the relevant ones for your business is important as it can make all the difference. In this fast-paced world, if you continue doing every manually, you are not only inclining towards ineffectiveness but also driving you to irrelevance. Especially for a B2B market, tools help navigate a starting point for your marketing strategy. They can help gather targeted data and save ample time for brewing creativity. Think Out of the Box If you continue doing what others have already done or are doing, there is little to no chance of standing out in this cutthroat market. Explore your options of targeting the right audience through different community-based channels like: QuoraExplore to know what people really want to know about your services and products. If you can, answer the ones which have the most interactions, provide people the solutions to their problems and drop your website links. Product Hunt Go ahead and interact with the community of people that you most relate to. Once you get a hang of things, you will realize that most marketing efforts do not even cost, like building a community on Quora or Product Hunt, but they go a long way in making a name for your brand. We know that not every time you have the luxury of focusing on these details, and it’s hard for everyone to devote themselves entirely to such an intriguing concept as marketing. However, we’re here with experts like Jeff himself to help create a market for your business and also provide some best practices about what works when building a market for your product or service.
How the Ethereum Merge Impacts DeFi Industry and the Environment Posted on September 28, 2022November 29, 2022 by Admin The huge overhaul of Ethereum from proof-of-work to proof-of-stake has finally happened. The event took place on September 15th as Google tracked the event with a countdown timer with two cute pandas. Let’s understand what it is, why it was a crucial undertaking and the risks and benefits of ETH Merge. Proof-of-Work and Proof-of-Stake Explained In order to understand ETH Merge, let’s first get to the root of how decentralized systems function in contrast to centralized systems. The latter depends on a central authority or organization to facilitate transactions, oversee intent and take necessary action in case of malicious activities. However, in decentralized systems, both control and responsibility are distributed to a network instead of being concentrated with a central entity. Now, in decentralized systems, to ensure that every participant maintains integrity, there are validators who authenticate transactions on the distributed platform. This leads to another concern- what prevents the validators from acting maliciously? They put up collateral or stake to ensure good intent and consequences for validators. For a job well done, validators are rewarded, and for malicious activities, they pay through their collateral. A validator approves transactions and paves the way for ‘consensus’ by putting up something of value. Said consensus can be achieved in a variety of ways. Proof-of-work (PoW) is one of them, where each validator spends significant time and effort verifying each transaction. These validators would set up warehouse-like computing machines that’d run round-the-clock. Why, you ask? So that they can successfully verify transactions and earn rewards (new coins). When ETH worked through the proof-of-work consensus mechanism, it consumed as much energy as the entire nation of Finland. This brings us to what Ethereum is up to now- Proof of Stake (PoS). The proof-of-stake consensus mechanism instead requires validators to have skin in the game by ‘staking’ their own coins. For a job done well, they earn more coins. For a screw-up, they pay the penalty in the form of a part of or all of their collateral. What Is Ethereum Merge? ETH transitioned to the PoS consensus mechanism through the merging of two blockchains. The ETH blockchain that people widely use is known as ‘mainnet’, different from the many ‘testnet’ blockchains only used by developers. In December 2020, ETH developers built a new network called the ‘beacon chain’, the new Ethereum. Since 2020, validators have been adding blocks to the chain without entering any data or transactions. On September 15th, when the clock struck 06:42:42 UTC at block 15,537,393, we experienced the merging of the Ethereum mainnet execution layer and the Beacon Chain’s consensus layer at the Terminal Total Difficulty of 58,750,000,000,000,000,000,000, meaning ETH will no longer rely on PoW consensus. Ethereum co-founder Vitalik Buterin tweeted early in the day to confirm the merge. In a YouTube livestream, the creator of Ethereum said, “This is the first step in Ethereum’s big journey being a very mature system, and there’s still steps to go. We still have to scale, we still have to fix privacy, we still have to make the thing secure for regular users, we all need to work hard and do our part”. The merge is the network update to ETH, which would allow it to function with the PoS consensus mechanism moving forward. The switch to proof-of-stake had been planned since 2014 but got delayed many times due to technical complexity and the humongous amount of money at risk. Crypto’s Implications on the Environment Today more than ever, people are concerned about climate change and its impact on the environment and lives. Carbon emissions from Ethereum were too conspicuous to ignore. Let’s understand the environmental impact of crypto by looking at what miners did. A miner would set up a powerful computer called a mining rig to execute software that would solve complex cryptography problems. This miner’s rig would be in competition with hundreds of thousands of global miners attempting to solve the same puzzle. As cryptographic problems would become more complex, all the more energy would need to be expended to solve them. By one estimate, Ethereum consumed close to the total electricity consumed by Switzerland’s 9 million citizens, or 62 million terawatt hours. Now that ETH has adopted proof-of-stake, miners will instead deposit ether tokens into a pool. Consider each token as a lottery ticket, picked at random to decide who would win the reward. By shifting to PoS, Ethereum now consumes 99.9% less energy. Moreover, as per one tweet from Vitalik Buterin, the merge reduced worldwide electricity consumption by 0.2%. Why the Merge Was Crucial Ethereum blockchain wasn’t secure when using the PoW consensus mechanism. Whoever would be the first to ‘validate’ a block would receive a reward, and everyone else would fail. This means anyone with abundant resources, like electricity, could monopolize the activity. To overtake a proof-of-work blockchain, a malicious actor would need to have 51% of the network’s power under control. With PoW, a validator would need access to $5 billion to buy enough computers and transformers, connect them to a grid and carry out an attack. With PoS now, Ethereum now has $20 billion in economic security, which will continue to grow. ETH developers also say that the network of the $60 billion ecosystem of crypto exchanges, lending companies, NFT marketplaces and apps will now be more secure and scalable too. Besides increased security, Ethereum Merge will also impact a wide portfolio of services and tools operating on the network, such as decentralized applications, decentralized finance protocols and millions of non-fungible tokens. Finally, given how expansive and popular Ethereum is, the transition will kick off positive climate action rippling across the Web3 industry. Were There Risks to the Merge? Critics of Ethereum, who often are proponents of bitcoin, compare the merge to changing an airplane engine in the middle of a passenger flight. So, there was a lot at stake- the airplane and the $188 billion worth of ETH in circulation. The update’s complexity was also compounded by the fact that it may have been one of the biggest open-source software initiatives in history, needing coordinated effort across dozens of teams and many individual researchers, volunteers and developers. When we look at the technical side, there can be unforeseen bugs within the new blockchain. Critics also question if the new blockchain would be as secure as the older PoW-based one. However, proponents of ETH argue that slashing (revoking the access of validators and burning their stake) malicious validators might mean more integrity and security on the new Ethereum blockchain. The Positive Impact of ETH Merge The successful implementation of the ETH merge informs regulators that the crypto industry can adapt to prioritize the planet and its well-being. Considering the White House Office of Science and Technology’s Policy (OSTP) report on Climate and Energy Implications of Crypto-Assets in the United States, the merge will lead to further research and collaboration the Congress and the crypto industry. Recommendations in the report included assessing and enforcing energy reliability in the wake of crypto mining projects, setting energy efficiency benchmarks and research and monitoring. This means that the White House acknowledges the potential for the positive contribution crypto-mining has in the nation’s transition to clean energy. For miners, mining Ethereum used to be costly. As electricity prices surged and crypto prices plummeted, even successful miners started seeing red. To offset their costs, miners typically sell most of their crypto assets earned from mining, which is millions of dollars of selling pressure daily. Now that Ethereum is PoS, validators won’t need to sell the ether they earn, as validating blocks has become significantly cheaper than PoW. Miners are now replaced with stakers who stake at least 32 ETH by sending them to an address on the ETH network where these assets can’t be bought or sold. ETH Merge would also invite lucrative financing from ESG-aware investors and business leaders who wish to make green investments. Finally, sustainable crypto-mining would attract regulatory support to amplify and scale the crypto industry to create jobs and be more widely used. What Next? ETH- Merge, Surge, Verge, Purge, Splurge It’s critical to note that the Ethereum Merge is not the end all be all of the upgrades to the Ethereum network. It’s only part one in a five-part series of changes that would make the network highly secure, reliable and climate-conscious. Now, developers will need to crack an existential question. The Merge was only the first step toward a series of upgrades on Ethereum to solve the scalability trilemma. According to the theory of The Blockchain Trilemma, termed by Vitalik Buterin, developers face challenges in creating a blockchain that’s scalable, decentralized and secure without compromising on any of those. However, blockchain developers often need to make a tradeoff between those aspects, preventing them from achieving all three. Decentralized – A blockchain system must not rely on a central point of control or authority. Scalable – A blockchain system must be able to handle an exponential amount of transactions. Secure – A blockchain system must defend itself against bugs, attacks and other unforeseen issues besides operating as expected. The theory suggests that after a certain point, a blockchain must compromise on one of the three critical aspects and that it cannot have all three at the same time. The Ethereum blockchain has successfully completed its first step toward solving this problem with the Merge. Now, it needs to undertake the next four legs of development. The Surge – Implementation of sharding, a scaling solution which The Ethereum Foundation claims will lower the cost of bundled transactions on Ethereum. Once the surge is done, the Ethereum network will process transactions faster, too. While today’s Ethereum can process 15-20 transactions a second, the one with the rollups and sharding will process 100,000 transactions a second, according to Buterin. The Verge – The Verge will implement Verkle trees, a kind of mathematical proof, and stateless clients to allow users to become network validators without needing to store extensive amounts of data on their machines. The Verge will be key for higher decentralization. The Purge – The Purge will purge old network history to drastically reduce the amount of space required on your hard drive, simplifying the Ethereum protocol and not requiring nodes to store history. The Splurge – This update would involve all miscellaneous updates to ensure the Ethereum network functions smoothly. It is still hard to talk about the timelines of the next four stages of Ethereum development as each is under research and development. Meanwhile, investors in Ether are expected to lock up their tokens in digital wallets that enable earning tokens under the new PoS format, which they won’t be able to retrieve for at least a while. Ethereum will need to undergo yet another significant change called Shanghai, which is at least 6 months away. After that, investors may be able to make withdrawals below a capped amount. Changes and updates to the Ethereum network will pave the way for better blockchain systems that honor the climate and the planet. Stay tuned to learn more about the subsequent updates as they happen. KiwiTech has established a Web3 Center of Excellence to cater all kinds of blockchain development needs. Get in touch with our seasoned blockchain consultants today.
How Startups Can Manoeuvre the Current Funding Slowdown Posted on September 23, 2022September 23, 2022 by Admin According to a CB Insights report, global startup funding fell 23% in the second quarter of 2022 from the first quarter, with $108.5 billion invested in 7,651 deals. This is the biggest quarterly percentage drop in deals and the second largest plunge in funding in a decade. However, despite the aggressive drop in deals, both funding and the number of deals remain above 2020 levels. The U.S. saw almost half of all funding at $52.9 billion, a 20% decrease from the previous quarter and the lowest quarter since 2020. Only 85 unicorns came into being in Q2, 2022 globally, a 43% drop from Q1. The U.S. birthed the most unicorns, a total of 49, followed by Europe, which saw the rise of 16 unicorns. In the second quarter of 2022, VC investments in Indian startups stood at $6.9 billion, down by a whopping 60% from $11 billion in Q1. The funding slowdown has spread to early-stage startups in the U.S., with the segment suffering its biggest investment drop in over a decade. In Q2, venture capitalists invested $16 billion in early stage (Series A and B rounds) startup deals in the U.S., which marks a 22% decrease from the previous year. Seed funding was the most robust stage in May 2022, with $3.1 billion invested in seed-stage companies. Seed-stage funding increased 11% from the previous year’s monthly average of $2.8 billion. In recent years, venture firms competed against each other to invest early and often in a startup’s lifecycle, a sentiment that is no longer shared as investors proceed with caution toward riskier investments. In early 2022, venture capitalists stayed optimistic about early-stage investments even as public shares plunged. A worsening macroeconomic environment and a virtual freeze in investment for growth-stage startups have changed that. In this environment, the youngest startups have to demonstrate their clear path to revenue and profits to bag investment. After a decade of cheap money available at low rates and high market liquidity, startup founders now looking towards a funding slowdown. Here are a few reasons why: Interest rates are on the rise, increasing the cost of borrowing money.Investors have a smaller appetite for risky investments as they can get guaranteed returns on secure and stable investments.The stock market is falling, and public-market valuation correction affects the private markets.Consumer spending is declining, which affects company earnings in the short term, ultimately amounting to a recession. Action Steps for Startup Founders and Small Businesses Extend your runway Can you slow down your growth to sustain this funding slowdown season and then accelerate growth on the other side? Consider sacrificing growth in the short-term and focusing on sustainability to avoid having to raise funds in this season. This does not mean you’ve accepted failure, only that you are adapting to a rapidly changing economic environment. Understand what investors are looking for Investors are interested in making cash right now but not at high risks. They either want to invest in efficient, cash-rich and profitable startups or those that operate in recession-proof industries, such as safety and security products- low-cost consumables, life-saving drugs, and utilities that help consumers save on their electricity bills, for instance. Between enterprise SaaS and e-commerce, two sectors that attract the most investor interest, VCs invested in 211 e-commerce businesses in Q2, down from 330 investments in the previous quarter, a 36% decline. Similarly, VCs participated in 30% fewer enterprise SaaS deals in the same period. Studying investor patterns can help startups prepare for funding. Show proof of agility Startups with a low Customer Acquisition Cost (CAC) can attract the attention of risk-averse investors. The best thing startups can do is show investors that they are agile enough to survive and gain market share in an economic downturn. Demonstrate how you can go from aggressive growth to conservative growth and preserve the vision and essence of your business to ride out the current funding crisis successfully. The word is ‘profitability’ Over the past decade, startups enjoyed easy money and funneled it into higher revenue and market share, putting off profitability for the future. That future is now here and investors are using the word ‘profitability’ more than ever. What can you trim that doesn’t affect profitability or customer experience in any way? Can you collaborate with other startups and barter services? Experts suggest this is the time to cut the ego aside and buckle up to run for the fundamentals- profitability. Identify your “lipstick” product The “lipstick effect” was coined by Leonard Lauder in 2001 when he observed that lipstick sales continue to grow in an economically beat market. The idea is that consumers find the budget for small indulgences for an emotional uplift during trying economic times, even as they eliminate purchasing expensive items. Is there a “lipstick” product that your brand can offer to stay afloat? How About Equity Crowdfunding? This year seems to be monumental for equity crowdfunding as much stigma sheds around only startups not good enough for VC raising this way. With the traditional fundraising climate cloudy, equity crowdfunding may get its fair share of due attention. Any company that meets the SEC qualifying criteria can apply to raise through a crowdfunding portal. A crowdfunding portal, StartEngine, reported that it’d seen double the number of companies applying to raise capital on its portal in the first four months of 2022 compared to 2021. Crowdfunding is a sought-after alternative to raising VC funds and is sometimes the primary choice. In terms of raw reach and exposure, nothing beats crowdfunding. It also allows you to build a community while raising money and boasts of strong funding potential. Read our latest pieces around crowdfunding and speak to one of our crowdfunding experts today to learn if it’s the best way for you to raise in a climate of recession- The Role of Branding in Crowdfunding Campaigns The 6 Pillars of a Successful Equity Crowdfunding Campaign 7 Ways to Keep Your Equity Crowdfunding Campaign on Track Common Questions About Equity Crowdfunding
EdTech: How the Industry Is Blooming One Startup at a Time Posted on September 23, 2022March 13, 2023 by Admin The education sector is one of the most exciting industries to watch. Technology is changing the way we learn, with Covid-19 laying the groundwork for the complete digitalization of education, leading to the emergence of thousands of startups aimed at improving the education sector. EdTech has become a viable and popular industry with immense potential in the past couple of years. We don’t say this; the numbers do. The global education technology market was valued at USD 106.46 billion in 2021, with estimates of a compound annual growth rate (CAGR) of 16.5% from 2022 to 2030. (source: Grand View Research). The industry is dominated by hardware, software, and content innovation positioned to make learning more accessible, affordable, and result-oriented, leading to thousands of startups materializing to change EdTech for the better. Here’s a Quick Overview of the Global & Us EdTech Market: The numbers speak for themselves – the education industry is ripe for innovation, and startups are leading the charge. But what’s driving this growth? In this article, I’ll explore the key drivers fuelling the EdTech industry’s success. Technology is playing a significant role in making education more accessible than ever before. The proliferation of smartphones and tablets, as well as high-speed internet access, has made it possible for anyone to access quality education. Investment in the EdTech sector has motivated entrepreneurs and innovators all across the globe to bring in more innovations in the space. Some of the well-known companies that have been investing in EdTech startups are Google, Microsoft, Amazon, and Facebook. These tech giants have been playing a significant role in making education more accessible than ever before. Other key drivers include the increasing demand for personalized, gamified learning experiences with the convenience of learning from anywhere. This has led to the development of new technologies such as adaptive learning, virtual reality (VR), and augmented reality (AR). The trend of online and blended learning is also gaining popularity, as it offers a flexible and convenient way to learn. Moreover, the increasing cost of education and the need for better employment opportunities are some of the other key drivers fuelling the growth of the EdTech industry. With such rapid growth, it’s no wonder the EdTech industry is attracting much attention from startups. KiwiTech’s EdTech Portfolio Acknowledging the potential of this industry, KiwiTech has been actively supporting and onboarding EdTech startups leveraging technology to make a difference in the education sector. So far, we have supported 20+ EdTech startups and scale-ups globally focusing on the US, via our network of 70+ EdTech investors who actively support entrepreneurs transforming education via technology. These startups are solving various problems in the education sector, ranging from content personalization to adaptive learning to assessment solutions. Trees App Trees is an app that walks college and university students down an individualized path to success, tailored by machine learning to each student’s school, program, situation, habits, and personality. It’s like having a big sister who has done it all before—she knows you and your situation well enough to steer you around the dark woods of frustration and confusion, guiding you instead to sunlit meadows of good grades, cartwheels, good people, and good choices. Levered Levered is a complete elementary math instructional tool, developed by a former teacher, built by educators, and refined in the classroom with a proven impact on learning for students at every achievement level. Levered uses a powerful combination of competency-based instruction, real-time formative assessments, and data-informed instruction and support to help the teacher meet the needs of each student every day. Enrichly Enrichly is an EdTech firm that uses the power of technology, gamification, and data to help children reach their full potential. They are passionate about providing innovative EdTech and behavioral mental health solutions that help kids everywhere reach their full potential. Their solutions increase self-esteem and confidence in children, which leads to better-improved learning and mental health outcomes and a brighter future. In July, Enrichly also got an opportunity via Start Engine to pitch in front of Mr. Wonderful, out of thousands of applicants. Watch this video to hear what Kevin O’Leary said about Enrichly! We’re highlighting the EdTech breakthroughs through our Events Ecosystem. With the education sector undergoing a digital transformation, there are a lot of scopes for EdTech startups to make a difference. KiwiTech is committed to supporting such startups by providing them with the resources they need to succeed, including the right kind of network to thrive. KiwiTech’s events ecosystem has always worked towards building opportunities for such innovative EdTech startups to get in front of an audience, connect with industry veterans, and raise investment. In November 2021, we hosted a virtual EdTech Demo Day where 5 of our portfolio companies had the opportunity to showcase their solutions in front of an audience of 70+ unique attendees, including industry veterans, investors, and ecosystem players. This was an excellent platform for these startups to get visibility and connect with potential customers, partners, and investors. WISE EdTech New York Investors Day This month, we’re also excited to partner with WISE EdTech, a leading global startup accelerator established by Qatar Foundation, for their New York Investors Day. The event will bring together some of the most innovative and disruptive EdTech startups to showcase their cutting-edge solutions to select investors. Highlights: – Startup Workshop by Michael Dermer, Founder & CEO of The Lonely Entrepreneur – Startup Pitches – Crowdfunding Panel by Jeff Wenzel, Vice President of Crowdfunding, KiwiTech – Investor One-to-one Blitz Sessions – Networking Session Pitching startups include: Silabuz, helps companies see the potential in their existing employees and upskill #tech talent to meet their needs. Baobabooks Education, an easy-to-use and intuitive EdTech platform where children, teens and young adults can write, illustrate and publish their own books and then share them with the world. TinyIvy is an innovative reading system that gives every child an equal chance to rocket themselves into a bright future. Instill Education, supports educators and aspiring teachers in their education journey through a digital professional development platform. Lynx Educate, a platform that supports European companies in connecting their employees with high-value upskilling and education programs. Ynmo | ينمو, a platform that can help users design, monitor, and share personalized therapeutic plans for students with disabilities. If you’re an EdTech startup looking for opportunities to get visibility and connect with industry veterans, investors, and ecosystem players, KiwiTech’s robust startup ecosystem can get you the platform you’ve been looking for. Contact our VP-VC & Corporate Partnerships, Amy McCawley, at amy.m@kiwitech.com to learn more.