BUSINESS IDEA | STARTUP

SMS Newsletter Platform 📲 

Using SMS to SOS (from low open rates)

Available Domain: Textwave.com

1. Problem/Opportunity❓

The Opportunity: As we discussed in a previous edition of Half Baked, SMS marketing is popping off right now. And with 98% open rates it’s no wonder why.

Which got us thinking. Could you create SMS newsletters and by extension a platform for sending SMS newsletters? You bet your ass you can.

Market Size: Hard to get one since it’s a nascent market, but the email marketing market was valued at $7bn in 2022, so this would be a good indicator for the market size.

2. Solution ✅

The Idea: A platform to create, scale and monetise SMS-based newsletters

How it Works:

• An individual or the business signs up to the platform. Once they do they can create their SMS-based newsletter from templates or fully from scratch. This can include text, hyperlinks and even videos.

• Their readers then subscribe to their newsletters which can be sent out in bulk to subscribers via text.

• Customers also have a centralised dashboard where they can track open rates, link clicks and other key KPIs for their newsletter, similar to newsletter platforms.

Go-to-market: Start by working with influencers who have big newsletter audiences to build SMS newsletters for them

Monetisation: Monthly subscription fee based on how big newsletters are

Startup Costs: You’ll need to do a small raise here to get this off the ground, probably 100k or so, since the tech build out here will need engineering resources

3. How You’ll Get Rich 💰

Exit Strategy: Sell to a large email platform, like Mailchimp (owned by Intuit) or a large SMS Marketing platform like Hustle

Exit Multiple: Ad/marketing business multiples are around 12x EBITDA currently

DRUNK BUSINESS IDEA

The Pet Petter

Let’s face it. If you have a pet, you love them to death, but you don’t always have the time to give that little ball of joy the attention they deserve.

Or at least you didn’t…until now.

With the pet petter you can make sure your pet gets attention 24/7 while you get some much needed R&R. Show your pet the love and affection they deserve.

JUST THE TIP

Trend 📈: Bearish AI Sentiment

Is the AI bubble starting to pop? Well some pretty smart people think so. Last month Goldman Sachs released a paper entitled “Gen AI: too much spend, too little benefit?” where they question whether the enormous capex spend by tech companies will yield the returns needed to justify the spend. Sequoia’s David Cahn went a step further in his piece, AI’s $600B Question, where he puts a number on this, suggesting that companies need to see $600bn of revenue driven by AI to justify their capex spend.

Business Ideas

• AI Sentiment Index: Create an index which tracks sentiment among investors around AI and AI company valuations specifically

• AI Investment Tracker: Create a tracker which captures all the AI companies who have received investment, how much they raised and what multiple they raised at

THE MONEYSHOT

The One Person Business Making $200k Per Month

In the internet age you don’t need a fancy office, a big team or VC funding to make millions of dollars.

And this founder’s story proves exactly that, by making millions of dollars per year all by himself.

Ivan Kutskir’s origin story begins in 2009, while he was an undergrad in computer science. He was obsessed with business ideas and building software. In fact at one stage he found himself working on 20 different ideas simultaneously (we feel you Ivan). And while working on these ideas Ivan became a Photoshop power user, but had 2 major issues with the platform - the $20 per month price tag and that you couldn’t use it in a web browser.

So in 2012 he dropped everything else and went all in on building a free version of photoshop that would work in a browser.

He called it Photopea.

He toiled away at the product on nights and weekends for years, mentioning the product on Hacker News and Photoshop subreddits to get early users. But he had a problem. The platform wasn’t making any money. In fact he put 7,000 hours into the product (5 hours a day for 3.5 years) before he made a single dollar from it, whcih came in 2016.

In 2016 Ivan turned on ads on the site and the money started rolling in. And as the product kept improving, a community formed around it and the users kept rolling in.

Today the site gets 1.5m visitors per month, generating $200k in revenue per month from ads. And to maintain the site Ivan spends just $50 per month for hosting and a yearly domain registration fee of $16. That’s all. It’s as lean a business as you could possibly build.

All of which goes to show that building great businesses can be built by just one person, but it takes time and commitment.

But it can be done.

INFLUENCER IDEAS

#HalfBakedBizIdea

Sam Lessin (GP at Slow, co-founder at Drop.io) clearly has the Olympics on his mind like the rest of us!

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