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E commerce Pitch deck
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- 4. Mobile Solution $370 Minvestment e-commerce SELL, BUY, RENT, GIVE AWAY Webshop For SMEs And A Global Solution Product & services Vehicle Real estrate Jobe
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- 6. Perfect precondition for onlineclassified Large population and technically mature Uncharted territory for online services After sanctions boom Largest economy in the World in 2014 18th Mobile penetration 142% Cities with over 1M population 8 Iran’s monthly minimum wage $250 Out of 140 countries for Global competitiveness 74th
- 7. e BEST TIMING Low domestic& International competition Weak domestic Competitors – International obstacle First-mover advantage ONLINE CLASSIFIED RIGHT BUSINESS SEGMENT Proven concept Available investment capital
- 8. REVENUE MODEL & INDUSTRIALCAPITAL ATTRACTION
- 9. De-facto standard inall emerging markets Revenue model and Industrial capital attraction Free and Upsell See slide Finance Webshop much easier than second-hand for monetization #1 INVESTOR IN EMERGING MARKET #2 INVESTOR IN EMERGING MARKET
- 10. ATTRACTION PHASE 4 Company value 51% ofshares: € 10 M $ 5 M investment for 3 years invest by shareholders And finally even attract investor such as Naspers $50M
- 11. years Vostok C2C valuationin Iran $1B+ after 6 years and still not a success Comparable to current valuation of Avito $2,7B 6 THE WINNER TAKES IT ALL IN
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- 14. 01 Assets, organization and executionin control. Organization, clear targets and execution 02 Superior technology approach Deep system development know-how 03Deep domain, market knowledge and network 04 05 06 Create network effect Reach customers belonging to existing seller networks Create value for thousands of network owners (SMEs) Use network owners as early adopter Free web shops for retailersэ Offer free web shop to thousands of small businesses. Mass import permanent & higher quality content Right local partners mean political protection. Established local partner/Investors with both resources and right connections. Public listing in Iran through Iranian investment bank STRATEGY CATCHING THE MARKET
- 15. Same goal ascompetitors, but different strategies Iran has 850,000 small independent outlets, boutiques and stores, about one for every 90 people. There is a huge desire to go online WHOLESALE RETAILERS BUYERS WEBSHOP IN MIN5 FREE MICRO WEBSHOPS BRING 1. MASS VOLUME 2. QUALITY CONTENT NEW GENERATION MOBILE APP WOULD TAKE OVER SECOND HAND MARKET 1POINT
- 16. FREE MICRO WEBSHOPSGIVES FREE ACCESS TO RETAILER’S NETWORKS & WEB TRAFFIC RETAILERS WOULD PAY TO GO ONLINE QUALITY CONTENT ATTRACT CUSTOMER Iran largest grocery retailer has a market share of just 1.4% of population have shown interest in competitor’s services2POINT 1.4% 2.0% Same goal as competitors, but different strategies Iran has 850,000 small independent outlets, boutiques and stores, about one for every 90 people. There is a huge desire to go online
- 17. 3POINT Same goal ascompetitors, but different strategies Iran has 850,000 small independent outlets, boutiques and stores, about one for every 90 people. There is a huge desire to go online SECOND-HAND GOODS SECOND-HAND SELLERS SECOND-HAND BUYERS COMPETITORS’ WAY With 1/10 of Block’s design, functionality, security and everything else
- 18. B2C revenue modelas affiliate network Publisher with own traffic signs up in the advertiser’s affiliate program e ADVERTISERS (retailers) In addition to upsell, resellers can buy different type of affiliate advertisement PPS/PPA/CPC/CPM QUALIXA as affiliate marketing provider Provides subscribable and traceable advertiser’s feeds to WEBLOGS, WEBSITES ETC. PUBLISHERS (affiliates) Anyone clicking on the ad will be redirected to retailer’s WEBSHOP CONSUMERS (buyer) Publisher gets commission when the consumer purchase from the advertiser SITES & APPS
- 19. Competitors review # Name E-commerce type Typeof ad # ads per Per day # Staff Pomegranate Investment Opportunity for future investments 1 Digikala 4 years old Private webshop (e.g NetOnNet) Home Electronic - 1000 $17 M (For 5%) Reason: Lack of C2C option Yes Reason: Lack of other option 2 Divar 5 years old Online classified (e.g. Blocket) Used Items 13000 Due toTemporary Monopoly of Iran Android Market 50 $0.5 M (For 2%) Reason: Unintentional Investment No Reason: Culture Clash 3 Shaypoor 4 years old Online classified (e.g. Blocket) Used items 4000 Spends a lot of money 40 $2 M (For 30%) No Reason: Very Poor performance 4 Bazaargahan (Qalixa) 1.5 years old Public Retailers webshops (e.g Alibaba) + Online classified (e.g. Blocket) Retailers goods + Used items 2000 Lack of resources to handle it 5 0 Was already stuck in two earlier C2C investment Yes Reason: Could Bypass Competitors
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- 21. WE ARE INVESTED CAPITAL $X M FOUNDER SWEDEN (100%) BUSINESS OWNERSHIP& DEVELOPMENT IN SWEDEN OPERATION UP & RUNNING IN IRAN X PEOPLE WHERE WHO 6 YEARS IN SWEDEN, 1,5 YEARS IN IRAN
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- 23. Average monthly salaryin Iran 750 $ Operational costs are included, i.e. office and equipment Average monthly salary in Sweden 8 000 $ Operational costs are included, i.e. office and equipment COA in Iranian currency 1 000 IRR Cost of CPC in Iran Cost Of Accusation (COA) per visitor 0,028 $ Cost of CPC in Iran COA yearly reduction rate COA/year # Will be reduced per year (Blocket Marketing cost = Operational cost * 2) Ad fee 0,0 $ Is calculated as an average, based on the average income level in the country (Sweden is 40.) Fee will be introduced for selected vertices in major cities (eg property in Tehran) over time, the site becomes attractive. Webshop fee 0,0 $ Limited number of articles (ex. 200), First year completely free. Average upsell cost 1,5 $ Upsell means when the ads in different ways is become more visible (VAS in Avito). Is calculated as an avr, based on the average income level in the country (Sweden is 40 kr) Premium webshop yearly fee 250 $ In Sweden 9000 kr C2C ads in % of total visitors 5% Tested in the field Company per day/person 3 Most of the job is automated. The target is 4 companies with limited number of items (eg 200) per person per day. Average # of ads per company 250 Tested in the field Dedicated B2C resources 50% Ratio Input parameters - costs
- 24. 1 2 34 5 6 Total # of webshop 14 40 75 110 156 290 Average traffic/day 60 220 600 1260 2748 4790 14 40 75 110 156 290 60 220 600 1260 2748 4790 0 1000 2000 3000 4000 5000 6000 7000 8000 0 50 100 150 200 250 300 350 FINANCE build traffic DAILY TRAFFIC AMOUNT OF WEBSHOPS YEARS Pass competitor #1 Pass competitor #2 k#
- 25. 1 2 34 5 6 7 Marketing investment 342 600 1218 1803 2790 4546 6480 Average traffic/day 120 390 838 1730 3593 6691 9210 342 600 1218 1803 2790 4546 6480 120 390 838 1730 3593 6691 9210 0 2000 4000 6000 8000 10000 12000 0 1000 2000 3000 4000 5000 6000 7000 FINANCE build traffic DAILY TRAFFIC AMOUNT OF WEBSHOPS YEARSk# Pass competitor #1 Pass competitor #2
- 26. 1 2 34 5 6 7 # of B2C upsell ads/day 0 98 688 2135 5179 10858 24193 # of C2C upsell ads/day 0 88 833 2983 9233 25564 71415 # of paid webshops 0 140 990 3074 4971 7818 11613 98 688 2135 5179 10858 24193 88 833 2983 9233 25564 71415 140 990 3074 4971 7818 11613 FINANCE monetization YEARS C2C UPSELL ADS PER DAY, # B2C UPSELL ADS PER DAY, # AMOUNT OF PAID WEBSHOPS #
- 27. FINANCE results & valuation 12 3 4 5 6 7 Acumulated Result -0,83 -1,56 -1,92 1 3,67 9,27 43 Estimated Valuation 5 15 30 60 120 240 500 -0,8 -1,6 -1,9 1,0 3,7 9,3 43,0 5 15 30 60 120 ACCUMULATED RESULT ESTIMATED VALUATION $M YEARS
- 28. 1 2 34 5 6 7 # of resources out of Iran 5 5 6 6 8 10 12 # of resources in Iran 15 25 50 75 100 150 200 Operational Cost 0,8 1 1,9 2,2 2,6 2,9 3,24 Marketing Cost 0,34 0,9 1,5 1,8 2,79 4,55 6,48 5 5 6 6 8 10 1215 25 50 75 100 150 200 0,8 1 1,9 2,2 2,6 2,9 3,24 0,34 0,9 1,5 1,8 2,79 4,55 6,48 0 1 2 3 4 5 6 7 0 50 100 150 200 250 300 350 400 FINANCE staffing & costs YEARS# M$
- 29. FINANCE summary figures Year Other# Staff Iran # Staff Operation Cost Marketing Cost Total Cost Paid adin % Total ads per day Annual revenue Net income $1,5 per Ad 1 5 15 684 000 $ 342 000 $ 1 026 000 $ 0,5% 10000 27 000 $ -999 000 $ 2 5 25 801 000 $ 600 750 $ 1 401 750 $ 4% 25000 360 000 $ -1 041 750 $ 3 6 50 1 218 000 $ 1 218 000 $ 2 436 000 $ 6% 70 505 1 522 908 $ -913 092 $ 4 6 75 1 443 000 $ 1 803 750 $ 3 246 750 $ 8% 100 784 4 353 869 $ 1 107 119 $ 5 18 100 1 860 000 $ 2 790 000 $ 4 650 000 $ 10% 160 612 8 673 048$ 4 023 048 $ Avito revenue today: 60 $ M
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- 31. Funding 1 YEAR 2 YEAR 3 YEAR Go live withxxxx within 6 month, demonstrate influx of B2C ads and traffic Develop mobile app, launch improved e- commerce web and mobile solution. Increase influx of ads and traffic Marketing and growth Continued development of the e-commerce Business Intelligence Engine. The core that learn about customer behaviour to provide relevant and attractive offers that add value. This value will attract upsale Growth Growth Growth _______ ____ Founders Angel capital Venture capital Public capital 0,8 2,0 - - 0,8 2,0 - - 0,4 1,0 - - M$ valuation In 6 years$500M
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- 34. E-commerce platform cornerstones- overview Product characteristics that enable a competitive strategy Easier to attract small businesses. Batch-publishing possibilities for business ads, e.g. Apparel, Home appliances. More business ads lead to more private ads. An app with Wallapop characteristics would attract private mobile users. More focus on verticals. Real estate, Autos and eventually Jobs. Would attract private persons more easily. Requires a more vertical specialized platform. COMPETITIVE STRATEGY
- 35. VISION Merging to worldsin One Simple Mobile App
- 36. Vision MOBILE INSTANT MESSAGING APPS NEW GENERATION CLASSIFIED APPS SIMPLE SIGNUP &BUILT-IN COMMUNICATION & SOCIAL SHARING LOCATION AWARE SEARCH & POST MERGING TWO WORLDS IN ONE SIMPLE MOBILE APP
- 37. 4 MUST HAVECHARACTERISTICS OF #1 CLASSIFIED APP Must have characteristics in order to challenge US Craigslist and other major European players such as Blocket There is no mobile solution that fulfills all characteristics Wallapop is just a small but important step in the right direction The App that places right in the middle could get #1 position
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- 39. Timing - Market& Businesses A True Mobile, Vertical & Business Centric Classified Platform Could Compete in Many Countries Real estate, Auto, Job, General First Iran Then selected countries MENA region Then selected western countries
- 40. Source: SimilarWeb, 25March 2016 Online Classifieds in IRAN Still only used by 5% of population 25% from small businesses 80% from larger cities, 40% Tehran Instead of the second-hand culture-building strategy, focus should be on high volume of ads from small businesses & verticals like Auto & Real estate
- 41. Online Classifieds inIRAN Source: SimilarWeb, 25 March 2016 Remarkable note Almost no traffic changes during past 6 months Visits per day Ads per day 160 K 16 K 40 K 4 K
- 42. THE TEAM LEADERSHIP &EXECUTION
- 43. The Team, Leadership& Execution A centralized head in Sweden, developing and maintaining different type of e-commerce products based on few common components for different markets Better and cheaper product, made by experts in each particular domain Based on Mixed Schibsted (Product Clones), Rocket Internet (Multi Segment) and Kinnevik (Saltside org.) strategies Possible to begin simultaneously in several e- commerce segments / markets CEO CFO CMO CTO COO R&D Platform SOFTWARE FACTORY HEAD & Platform Clone Country Managers Marketing Operation &OPERATIONS BODY
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- 45. Our Strategies IRAN CORE Focus ongrowth and liquidity in all winnable verticals and cities Focus on success factors which are best in class team, leadership & core values Build products and services that in comparison end up as No. 1 Make every step measurable, be agile and change quickly Pay only for results and be stingy otherwise e
- 46. Our Strategies IRAN Mobile solutionare the highest priority for second-hand leads from private persons Build a contemporary and superior mobile app compared to competitors Build on knowledge, investigation, experience and not guessing Copy existing solutions from other, find weaknesses and improve upon them Make mobile solution suited even for small businesses with vertical support MOBILE SOLUTION e
- 47. Our Strategies IRAN Small businessesare the largest winnable group in emerging markets Build a product with additional support for SMEs, Real Estate and Auto agents. Let SME be the premier marketer of the product & services Create partnership with the most influential Real Estate and Auto agents Focus on targeted marketing such as telemarketing and face to face marketing SME & VERTICALS e
- 48. Our Strategies IRAN “Quality inall” is the best marketing strategy Focus on one city at a time Use targeted marketing to attract sellers and mass marketing to attract buyers Focus on mobile, social and online as the primary mass marketing channels Be frugal with domestic TV, Radio and newspaper marketing MARKETING e
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- 50. Product features (1/3) FeaturesQalixa Wallapop Divar Sheypoor Account registration Email + Password ✓ ✓ ✓ Google ✓ ✗ ✗ Facebook ✓ ✗ ✗ Phone number + SMS ✗ ✗ ✗ Share account on multiple devices ✗ ✗ ✗ ✗ Messaging over IP Text, Photo, Voice, Video & files ✓ ✗ ✗ P2P Voice call ✗ ✗ ✗ ✗ P2P Video call ✗ ✗ ✗ ✗ Outside app communication Phone call ✓ ✗ ✓ ✓ SMS ✓ ✗ ✓ ✓ MMS ✓ ✗ ✓ ✓ Mail ✓ ✓ ✓ ✓
- 51. Product features (2/3) FeaturesQalixa Wallapop Divar Sheypoor Location awareness Post ✓ ✓ ✗ ✗ Search ✓ ✓ ✗ ✗ Vertical support 4 separate verticals ✓ ✗ ✗ ✗ Sharing (Photo, Video, Ads) Broadcasting Channel (Unlimited Audiences) ✗ ✗ ✗ ✗ Group ✗ ✗ ✗ ✗ Post Post ad without account ✓ ✗ ✓ ✓ B2C B2C Taxonomy ✓ ✗ ✗ ✗ Webshops ✓ ✗ ✗ ✗ Mass publishing ✓ ✗ ✗ ✗ Security (Caller ID, IP Track, Block) ✗ ✗ ✗ ✗
- 52. Product features (3/3) FeaturesQalixa Wallapop Divar Sheypoor For sale ✓ ✓ ✓ ✓ For rent ✓ ✓ ✓ ✓ Condition Used ✓ ✓ ✓ ✓ New ✓ ✗ ✗ ✗ Internationalization Language, currency & unit support ✓ ✓ ✗ ✗ Contact Integration Phone, Google, Facebook ✓ ✗ ✗ Platforms Web ✓ ✗ ✓ ✓ Android ✓ ✓ ✓ ✓ iOS ✓ ✓ ✓ ✓ Windows, Mac OS, Linux, Blackberry ✗ ✗ ✗ ✗
- 53. e-commerce Web &Appe Features Mobility B2A Web design optimized for all type of devices Business & Private ads Location aware search & post Comprehensive & standardized taxonomy and attributes Search on map Rich Product Data (~ 2 million product . Description, Attributes, Images, reviews, in almost all languages) Sort by distance Condition Support - Used & New Horizontal & Vertical Automated online shop Product & Services, Vehicle, Real Estate, Job Mass product publishing for businesses (5 million per hour) Product & Services based on Google Merchant categorization Mass-import of quality content – Companies from all main Affiliate program could be connected Ready for 10+ veticals (Services, Apparel, Consumer Electronics, Food & Beverage, Entertainment etc) Global Private, Business, Sell, Buy, Rent, Used & New Full Internationalization & Localization Support Support new EU job standard (ESCO) Language, Currency, formats and units Support Qalixa as comparison engine Different Domain – Same platform
- 54. The Roadmap Raise funding5 MUSD Go live with XXXX solution within 6 months – prove influx of companies and B2C ads and build traffic Develop mobile app v 2.0, 3 months, launch XXXX mobile solution to further grow number of companies and traffic 2018 2019 2020 2021 2022 Marketing and growth of B2C and C2C offering Further develop the platform. Create an engine that will understand visitor interest and promote relevant offerings, to create added value and more effective sale Growth Growth Growth Based on result from year 3. Raise funds to grow to a $ 500 M valuation company. Growth, growth and growth
- 55. THANK YOU May 2018,Iran e