How do you know that your startup is headed in the right direction?
A New Tool
The VC sector is stuffed with articles containing tips and tricks about how can you tell when your venture is on track. You’ve heard it all: “people get excited”, “lots of customer feedback”, “more competitors”, “DNA match between the team and the problem” etc.
But you read it and think to yourself: is there anything more meaningful than this generic fluff? Is there anything that you can actually test, measure against, and receive objective results that tell you whether or not you’re spending your life’s most precious resources (time, energy, reputation – not just money) on the right project in the right way?
Well, we think that there is.
It doesn’t take a brain surgeon to see that wherever there’s success, there’s a product or service that has substantial traction – and that means there’s action. That, of course, means that there will be people involved who are using the product. But our question is: how can you tell if people’s involvement is “significant” and their usage is “high”?
We want to see traction not because some people will buy the product, but rather because we want to see whether or not we’ve managed to conceive a killer product or service. And for that, what we really need is a method.
One possible method is a model called THE RAVINGFANS™ MODEL. RavingFans™ is a behavioral psychology model, designed to identify successful habit forming products and services at early stages.
The Underlying Assumption? Once a critical mass of users develops an ‘irrational’ relationship with a product or service, they are moving from the general market to a “no competition zone”. In other words, once users enter a RavingFans™ state of mind, it is extremely hard to get them to switch products.
To succeed, RavingFans™ aims to identify irrational behavior usage patterns – ones that are addictive, obsessive and compulsive.
Do you know people who incessantly check their email, scroll their photo sharing app each time they pick up their cellphone and log into their favorite social media platform before they’ve brushed their teeth in the morning?
Do you know people who can suddenly spend thousands of dollars on Etsy, Macy’s or Amazon?
Do you know people who surf endlessly to TripAdvisor or Booking.com even though they are not planning a vacation soon?
The model tracks the usage of these ‘irrational’ types of behavior, which are found to be accurate predictors of success. You can receive a RavingFans™ score on a daily basis and see whether or not your “secret sauce” makes an addictive dish.
Startups are welcome to use our model – at no cost.
You can receive more information on how to use the model here.
(Please pay attention to the frequently asked questions.)
Well, you’ve probably been asking yourself: what do these guys get out of it? Developing an algorithm and SDK both on the concept – and the technology level isn’t a cheap thing. What do they expect to gain?
Well, that’s actually our mutual bonus: Obviously, we’re not doing charity work here. Our business is investing in “irrational” ventures. And if your venture is on track, you may receive a term-sheet from us, ranging from US$500,000 to US$2,000,000.
That’s another bonus of having traction, isn’t it?