The article hints at Homejoy's plans to apply their underlying technology to services beyond cleaning.
It's easy to look at what Homejoy is currently doing, extrapolate to the point where they dominate that specific market, and say, well, this would be worth $X. But I imagine the vision that HJ has sold investors on is one well beyond the relatively narrow market in which they currently operate.
> but its a personal vanity project no one is demanding.
I'm not sure about that. It seems about 10,000 people are demanding it, as of noon Pacific time.
> Kickstarter being used by well funded celebrities who just want to minimize their risk to zero seems wrong to me. It should be for startups and good ideas that can't get funding elsewhere.
Ah, but these are not exclusive! Celebrities bringing their mass appeal to make more people aware of Kickstarter is exactly what will make it so that smaller players have a higher future chance of being funded through the platform.
The whole "those useless business people..." mentality may pop up in large corporations where roles are siloed off strictly and contact between groups is minimal, but if it's popping up in your startup it speaks to a failure to build a culture of mutual respect and transparency.
Short term, paying with FB for physical goods (eg. in restaurants, bars) is an unlikely outcome because carrier billing involves giving up an enormous percentage of the transaction to the carriers.
In the U.S., carrier billing typically involves yielding a 40 - 50% margin to the carriers. In Europe, the percentages are lower -- carrier billing is a more mature market there -- but they still top out around 20 - 30%. In developing markets, margins can go as high as 75 - 80%.
I don't know what sort of relationship FB has built with the carriers and what sort of percentage merchants using the billing system will ultimately end up with -- after all, both FB and the carriers will take a cut -- but I would be surprised if it isn't in line with the current percentages charged for carrier billing.
For virtual goods, carrier billing service providers claim the frictionless nature of the transaction and the reach (6 billion mobile subscribers globally) make up for the small margins.
Long term, of course, things could very well turn out differently.
Typically, though not always, the businesses that are torn down the hardest by the sharks have poor fundamentals and little traction.
Five percent equity taken from these businesses is unlikely to ever amount to anything of significant value, although naturally the entrepreneurs presenting their businesses may feel otherwise.
And if your business is in so poor of a state that it gets mocked and humiliated, there seems to be little downside to just re-incorporating if you truly believe in your idea. In this case, wouldn't ABC get nothing?
I understand that in the real world, legal ramifications and damage to one's reputation mean this rarely happens -- but is ABC really going to make a stink?
"A billion customers in the world... are waiting for a $2 pair of eyeglasses, a $10 solar lantern and a $100 house."
Interestingly, this article doesn't even touch upon the real challenge: It's not in mass producing these items at low cost; it's in gaining widespread distribution to those one billion customers -- across different countries and cultures, to thousands of groups of people each motivated by different things.
Motivation is key. It's hard to figure out what motivates people, and it differs enormously across cultures. You could have the most effective $100 house around, and you could even have a way of distributing the physical product to hundreds of thousands of people living in poverty. But what happens when no one wants to live in your house -- because, as it turns out, your house is foreign, not cozy; it just doesn't feel like home.
Does that seem like a silly example? It's not. The poor are not as easy to figure out as some people think. Understanding their motivations -- immersing yourself in their cultures and understanding what they really want, what really drives them to make certain decisions -- is the key to good design.
And, unfortunately, it's an aspect of good design that's not easily scalable.
Obviously, there are pockets where you can start and grow from. But saying that a billion people are waiting for $100 houses -- as if the only issue is designing that damn thing to get the price down! -- strikes me as not being the best way to begin a dialogue on poverty alleviation.
Apple would be spending half its cash pile to acquire a domestic company.
Nearly two-thirds (62%) of the company's sales are international [1]; furthermore, I would guess that much of the company's growth is in international markets, especially in Asia.
Unless Apple is seeking to improve its operational expertise in running carriers in order to buy up carriers throughout the world, this acquisition would be a very curious one.
It's easy to look at what Homejoy is currently doing, extrapolate to the point where they dominate that specific market, and say, well, this would be worth $X. But I imagine the vision that HJ has sold investors on is one well beyond the relatively narrow market in which they currently operate.