Startups · Project management

Solving a BIG problem Vs monetization

Bernard Ang

August 19th, 2016

I have been focusing on building platforms that solve potentially big problems and these problems surfaced from a personal experience or observation. 

However, one of the platforms I am working on deals with helping folks with mental health issues. To me, it's one of those areas that's under-represented and a tad taboo. 

I have been struggling with:

1) Is it a worthwhile project for VCs to look at? It will be all about ROI and acceptability of the topic dealt with. I know I have to build a user following and expand that before working on the monetisation model. I have an idea how. 

2) how the project will be viewed and if it could even be a buy-out potential

I started with trying to solve a big enough problem but my responsbility also lies with making it sustainable, hence the questions.


Richard Alcott Marketing and Communications

August 20th, 2016

Hi Bernard - innovation in mental health is a big deal. Instead of going the VC route, have you considered non-equity grant funding e.g. NIH? It is an alternative funding approach designed to fund proof of concept that can lead to commercialization. Grant funding is a longer, specialized bureaucratic road than private funding, but it has an attractive upside for commercialization, non-dilutive risk mitigation.

Andrea Raimondi Computer Software Consultant and Contractor

August 21st, 2016

Bernard,

It MAY be a PR disaster, it is not necessarily going to be one. But the possibility exists and that is the primary thing you have to ensure goes right. Bad PR could result in loss of company and, most importantly, reputation in a way that is difficult to recover from, especially when dealing with suicides. 

The topic of suicide is quite broad, it very usually is a build-up over time of things that aren't quite right, so instead of trying to - for example - build a hotline for wanna be suiciders, your best option would probably be to build a network of people who may BEFORE it gets to the point where saving a life is necessary. In other words, prevention works better than intervention.

And that's where you could easily make a difference, provided you surrounded yourself of top-notch technicians: by pivoting and providing help at this level, you could get several income streams, for example for cities to fund the project. By ensuring that each website is local but that they are federated into a network, this would also help travellers, so that people from other areas could meet or talk to local people. The design and the privacy concerns are many and varied, so that is part of why you really need to talk to the right people, because they'll know how to minimize/remove those concerns. 

Gillian Muessig COO, Board Chair at brettapproved, Inc.

August 20th, 2016

Hi Bernard, For VCs, it's not really about the subject. It's about the market and timeliness of an idea. First Round Capital performed research to study what makes an investment highly successful or not. Taking over 20 years of data, they determined that the primary success factor is "an idea whose time has come". In other words, is this the right time to build this company? We THINK an idea or concept may be taboo, or uncomfortable, and so on. In truth, the idea is merely not 'in it's time.' Trying to launch and fund an underwear line of clothing for the LGBTQ community would have been way out of its time in 1950. Today, such companies are doing extremely well. VCs are given a box of money by their investors. Their job is to return a larger box of money to those people in a reasonable period of time. This is about the money. Nothing else - and I mean truly - NOTHING ELSE matters in this regard. VC groups have specialties, interests in this or that field, expertise that may be of use to one or another founder. But their JOB is to return a larger sum of money than was given to them in a reasonable period of time. They MUST focus on that. So I would ask - Do you see the signs in the marketplace that the time is ripe for this idea? There are target users - people with mental illness - and there are buyers. Buyers may be any or all of the following: parents of children with mental illness, physicians, hospitals, counselors, or anyone else who might prescribe what you are offering. Buyers may adults with mental illness who will buy your product or service. Ask: Can your target buyer afford to pay for the service? Will the target buyer immediately see the benefit and value (ROI) of your offer? How often will the buyer make a purchase? How will identify and market to your buyers? How will they learn about your product and be convinced to buy? What's your gross margin on the delivery of this product/service? Is the company scalable? - in other words, can you deliver an increasing amount of product/service at a declining cost per piece or do you have a 1:1 ratio between delivery of service or product and the number of hires you'll have to make? Mental illness MAY be an idea whose time has come. VCs will focus on the indicators that this is so. WHAT TO DO -

Shel Horowitz I help organizations thrive by building social transformation into your products, your services, and your marketing

August 20th, 2016

Yes, there will be resistance--but you can position your platform as the exciting new frontier, the untapped and very desperate market that has lots and lots of online support communities but not a lot of people have tried to monetize it.

This is something I can hep with, BTW.

Mike Rynas Western Artisan Countertops

August 21st, 2016

Bernard,
I have spent the last 20 years as a founder, President and Director of a local Mental Health Non-Profit in the Greater Seattle Area.  I believe that mental health is at the stage of development as the HIV AIDS "market" was 20 years ago.  So, it is my belief that the time has come for "next steps".  There are smaller web sites that survive on advertising from RX companies etc.  But those companies seem to have limited scaleability to make a major impact.
I would be interested to discuss possible options in the USA market and internationally.  This effort may take patience and continually look for breakthrough opportunities.

Gillian Muessig COO, Board Chair at brettapproved, Inc.

August 20th, 2016

Hi Bernard, For VCs, it's not really about the subject. It's about the market and timeliness of an idea. First Round Capital performed research to study what makes an investment highly successful or not. Taking over 20 years of data, they determined that the primary success factor is "an idea whose time has come". In other words, is this the right time to build this company? We THINK an idea or concept may be taboo, or uncomfortable, and so on. In truth, the idea is merely not 'in it's time.' Trying to launch and fund an underwear line of clothing for the LGBTQ community would have been way out of its time in 1950. Today, such companies are doing extremely well. VCs are given a box of money by their investors. Their job is to return a larger box of money to those people in a reasonable period of time. This is about the money. Nothing else - and I mean truly - NOTHING ELSE matters in this regard. VC groups have specialties, have interests in this or that field, have expertise that may be of use to one or another founder. But their JOB is to return a larger sum of money than was given to them in a reasonable period of time. They MUST focus on that. So I would ask - - Do you see the signs in the marketplace that the time is ripe for this idea? There are target users - people with mental illness - and here are buyers. Buyers may be any or all of the following: parents of children with mental illness, perhaps physicians, hospitals, counselors, or anyone else who might prescribe what you are offering. Perhaps it is adults with mental illness who will buy your product or service. - Can your target buyer afford to pay for the service? - Will the target buyer immediately see the benefit and value (ROI) of your offer? - How often will the buyer make a purchase? - What's your gross margin on the delivery of this product/service? - Is the company scalable? - in other words, can you deliver an increasing amount of product/service at a declining cost per piece or do you have a 1:1 ratio between delivery of service or product and the number of hires you'll have to make? Mental illness MAY be an idea whose time has come. WHAT TO DO - Look for signs in the marketplace that people are looking for solutions, not just complaining about a problem. Look for competitors - an empty marketplace is often (although not always) a sign of too small or no market interest. Do market research - find your buyers and ask them what they would pay for your product/service and what they expect it to do for them. Make sure of your product-market fit. The short-short version of this answer is: focus on the business questions as you (and VCs) would for any business. Gillian Muessig Outlines Venture Group C: +1-206-930-8133 S: gmuessig @SEOmom

Bernard Ang

August 21st, 2016

Andrea, I like what you said. Prevention works better than intervention. That gave me some thoughts on a possible pivot. 

Stephanie Holt Owner, User Experience and Interaction Design at Tahiti Blue Interactive

August 23rd, 2016

Hi Andrea,

You are likely aware of this, and I'm sure the competition is fierce, but there are a number of investors, investment organizations, accelerator programs etc. that specialize in helping and funding social ventures and social entrepreneurs. A few to check out: http://www.enableimpact.com http://unreasonableinstitute.org/  http://www.goverb.com/

jana brubaker artist designer writer

August 23rd, 2016

1) public models are failing, so by all means why not private competition for seemingly endless market expansion?

2) how your project will be viewed will depend on how well you visually communicate your solutions; perhaps I can help?

Offering my expertise as arguably the global expert in the psychology of serial killers, I hate to see you waste your energies trying to duplicate my research efforts, see more: https://journal6other.wordpress.com/books/

Trauma recovery/conflict resolution model: https://journal6other.wordpress.com/unplay/

Meatspace concept model: https://journal6other.wordpress.com/nadine/

Sean Bennick Founder and VP of Get Mental Help

August 22nd, 2016

Andrea,

Sorry about that, long night here, bad eyes and such... I corrected the error.

I'm in agreement with the structure you're talking about. Also part of the mental health community, diagnosed with PTSD and Depression about 20 years back. I've run several mental health websites over the years and have sold two of them.

I'm in agreement with the structure you're talking about, was just suggesting that Bernard take a look at the use of subdirectories as a way to handle the management of the system. For example:
  • seattle.example.com
  • singapore.example.com
  • naples.example.com
Or perhaps something more directed to each country like:
  • seattle.usexample.com
  • naples.italyexample.com
If that gets too messy, then set things up by region or continent.