IDEA #1 | VENTURE STARTUP

Surplus Inventory Marketplace 📦

Taking stock of a massive opportunity

1. Problem/Opportunity❓

Managing inventory is super hard for brands and retailers.

If they run out of stock, no sales. If they hold too much stock, warehousing costs go up and cash flow problems ensue. It’s almost impossible to get it right.

Despite their best efforts companies constantly make or buy too much inventory, which has to go somewhere.

This excess inventory can either be sent to discount retailers (like TJ Maxx), go to liquidators to sell for pennies on the dollar or get disposed of. None of these options are ideal.

And the scale of this problem beggars belief.

In 2022, over $500 billion of excess inventory was sold at discount retailers, while over $163 billion is discarded annually.

Couple this with the fact that corporate bankruptcies are on the rise, and fire sales of surplus inventory are becoming more frequent, all of which means this problem is growing.

So let’s solve it.

2. Solution ✅

Here’s the idea…build a B2B marketplace where brands can efficiently sell their surplus inventory to vetted buyers.

Sellers would sign up for the platform where they could post listings of their surplus inventory. The platform would dynamically suggest a price to sell the inventory for.

Then vetted buyers could view these listings through the platform and purchase these products, with the platform organising the shipping of the products to the buyer.

Historically, the excess inventory market has been challenging for anyone apart from blue-chip brands, since most excess goods sales are kept to email lists, trade shows, and auctions.

This platform would make it easy for emerging players to buy high quality inventory at lower price points, making it more competitive and increasing prices sellers could charge. We’re growing the pie for everyone, and who doesn’t love pie?

Ghost is the only big player in this market, having raised $30m in Aug-23, but in a market this big there’s room for plenty more players.

3. Business Model 🏦

Go-to-market: Reach out to brands to find those who are having issues with overstocking, then

Monetisation: Charge a commission on each transaction, 10% - 15%. You could also make money in many other ways such as offering a premium service, or selling the data from the platform to data brokers.

Startup Costs: the big cost here will be building the platform. You may need a small raise to get this going but nothing crazy.

4. How You’ll Get Rich 💰

This is an exit play for sure. Build up the platform as big as possible and then exit to a large B2B marketplace player like Faire. EV/Revenue multiples are sitting around 5x - 7.5x currently, meaning you could have a huge exit on your hands here.

IDEA #2 | CASH FLOW BUSINESS

Cassette Tape Gifting Platform 📼

Don’t call it a comeback, they’ve been here for years

1. Problem/Opportunity❓

Question: What is this?

If you know the answer then I’ve got bad news for you…you’re old.

Don’t believe me? May I present to you…feeling old:

@shannieshoes48

#cassettetapes #NKOTB #cocktailthemovie GenZ doesn't understand the history of ways we listen to music. #genxtiktokers

In recent years though cassettes have made a comeback.

Sales of cassette tapes reached their highest level in 20 years in 2022, rising from 3,823 in 2012 to more than 195,000 in 2022.

Cassettes are on trend right now, and where there’s a trend there’s a business to be built.

So let’s build it.

2. Solution ✅

Here’s the idea…create a business which allows people to create mixtapes they can gift to their loved ones.

Here’s how it would work: users go on the website and create a playlist of their loved ones’ favourite songs. This could be a wedding gift, a birthday gift, something suitable for any special occasion. This playlist is put onto a cassette and along with a cassette player is shipped out to the recipient.

This would be an incredibly thoughtful gift, and from a business perspective it would be the gift that keeps on giving, since the sender or the recipient would buy more tapes in the future to play on it. You could turn it into a monthly subscription if you wanted. The goal here is to increase customer lifetime value as much as possible.

Depending on how fire the mixtapes are, there could be some insurance implications, but we think they can be worked through.

3. Business Model 🏦

Go-to-market: Here’s how we’d play it. Run some ads to a landing page detailing the service and see if you can get some pre-orders. Only start trading once you have customers lined up. Once you’ve proved out the demand and unit economics of the business, go all in.

Monetisation: Charge users who buy cassettes and cassette players through the platform

Startup Costs: You may need a little capital to get this started to buy the tapes and players, but not very much.

4. How You’ll Get Rich 💰

We don’t see this as a venture play but you could create a great cash flow business here. Just ride this trend all the way to the top.

IDEA #3 | CASH FLOW BUSINESS

Secret Santa Returns 🎅🏻

Give back this holiday season

1. Problem/Opportunity❓

Gifting is hard.

There’s no faster way to show how little you know about someone than giving them a present they don’t want.

And the office Secret Santa is the epitome of this. Every year scores of people receive gifts they don’t want and have to fake a smile and thank their colleague for the socks or candle they don’t want.

Now normally we’d be talking about how to capitalise on a problem like this to make a bunch of money, but it’s Christmas, or the Holiday Season or whatever we’re allowed to call it these days.

And Christmas is about giving back, so that’s exactly what we think you should do here.

2. Solution ✅

Here’s the idea…create a business (or nonprofit) which takes unwanted presents from Secret Santas and donates these gifts to charities or sells them to raise money for worthy causes.

Version 1 of this platform would be very simple: reach out to large businesses who do Secret Santa and let them know that, if employees receive a gift they don’t want, they can choose to confidentially donate them to a worthy cause.

You’ll be inundated with unwanted gifts pretty soon…we have no doubt. These gifts can either be donated to local or sold online to raise money for a particular cause.

If you wanted to take this to the next level you could build your own platform which offers all of the full secret Santa experience, with the donation component built into the website where users can select what organisation receives their donation. You could also partner with websites used to organise Secret Santas, such as Secret Santa Organizer, to give them access to your service too.

3. Business Model 🏦

Go-to-market: step 1 here is test it out with a few office places to see if it works, and if it does start reaching out to bigger and bigger companies to grow this initiative.

Monetisation: charge businesses to use the service to cover your overheads. You could wither run this as a business or a nonprofit, we envisage it as the latter

Startup Costs: This would be pretty resource intensive in order to make it work, but donations and volunteers will get you a long way to making this work.

4. How You’ll Get Rich 💰

There may not be a path here to earning millions with this idea, but if done right you could generate millions in donations for worthy causes. You may not enrich yourself, but could have a huge positive impact on the world.

JUST THE TIP

Making +$1m from Santa Letters

Real talk, Santa’s got it pretty easy.

He works 1 day a year, gorges himself on free milk and cookies and has an army of elves who he doesn’t even need to pay, once they don’t unionise. Even if they do Santa has a backup plan…

For all the perks of the job there is one big drawback…the fan mail. With kids from all over the world writing letters to Santa it’s almost impossible to get back to everyone.

Enter Byron Reese.

In 2001, Byron secured himself an address in North Pole, Alaska, and launched SantaMail.org. When kids sent letters to Santa to his address, he responded with personalized return letters from Santa himself…for a fee from their parents, of course, taking the work off Santa himself of course.

He sold 10,000 letters his first year and grew SantaMail.org into a $1 million business within a few years.