Swapit Secures Support from Microsoft BizSpark Program

microsoft-bizsparkSwapit has applied for the Microsoft BizSpark Program and has been accepted right away. We are proud to have been selected by Microsoft to become part of their startup eco-system that allows Swapit access to Microsoft’s vast resources, locally and globally.

Here is how Microsoft BizSpark advertises itself:

BizSpark gives startups 3 years of free stuff – software, services, tech support, and Azure cloud. Your startup qualifies if it is less than 5 years old, is privately held, and earns less than $1M annually. And at the end of your 3 years, you keep all the software you’ve downloaded – at no cost.

Benefits of the BizSpark program Swapit can tap into:

  1. MSDN Subscriptions (worth US$40,000)
  2. Microsoft Azure Benefits (worth US$27,000)
  3. Windows & Windows Phone Developer Accounts (worth US$300)
  4. Office 365 Subscription (worth US$1,500)

So in total, Swapit can access benefits through the Microsoft BizSpark program of up to US$68,800. That comes on top of the invaluable network benefits we receive by being a Microsoft BizSpark member.

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Swapit Secures Support from SoftLayer Catalyst Program

Screen Shot 2015-08-14 at 11.25.41 amSwapit has just joined the SoftLayer Catalyst Program at their highest tier for startups. We are very excited to have been accepted to SoftLayer’s very own startup incubator who’s core mission is

to enable next generation technologies and empower the entrepreneurs that will bring them to market.

We are thrilled to get access to the benefits that come with SoftLayer Catalyst:

  1. Access to a significant USD infrastructure credit on the SoftLayer platform.
  2. Mentorship access to “pick the brains of the industry veterans and über-genisues”.
  3. Incubator Integration, which allows us to collaborate and access more support outside, but affiliated with the SoftLayer incubation eco-system.

We will tap into all three of these benefits to grow swapit as fast as possible.

Since, we have launched our investor outreach for our funding round, we have received absolutely great feedback and accomplished to join several programs that help us cover costs, validate our business model and raise our valuation.

Seed Round Fund Raising has Started for SWAPIT Hong Kong

swapit_marketing-dollarTwo days ago, we have officially started our fund raising process by reaching out to 25 interested parties. As there is a lot of confidentiality involved with this process, I won’t be able to share much of the details publicly. I do however, want to share our experience during this period as much as I can, while keeping confidential information, well confidential.

Long story short, I have sent out our updated Executive Summary and Pitch Deck to our potential investors. Some have provided great feedback and interest immediately, and others have promised to revert back to me within the next couple of days.

7 Follow Ups

swapit-blog_requestOf course, you should never wait too long for someone to get back to you. As an entrepreneur who is looking for funding, you’re basically a B2B sales person, but you’re selling your company, product and vision, instead of a service or a product. A lot of research had been done on sales techniques and in terms of “follow ups” a rather important statistical fact has emerged: It takes on average about 7 follow ups with a prospective party to sell a product or a service to that party. Of course, sales cycles are very different for enterprise products, consumer products and especially for fund raising. However, the main message to take away from this, is: Always follow up. Sometimes, the party you’re communicating with, is just busy and perhaps has forgotten about your message. Sometimes, they just didn’t understand your message at first glance and they deferred to process it to a later stage. Perhaps they have disregarded your message because they’re not interested right now. Doesn’t mean they might be interested later, right? Or perhaps the most silliest of all things happened: your email just went into their spam filter and they didn’t even get to read your message in the first place. There are so many possible reasons that do require a follow up on your side. So again, always follow up. My follow up schedule, for example, is about a week after I last contacted a person. So that’s what you can expect from me.

Experience in Raising Funds Successfully – and failing to execute

swapit-blog-interestsOf course, an executive summary and a pitch deck is by far not enough to provide to investors. You got to get down to the nuts and bolts and make sure your plan of going forward is rock solid. In the end, it is all about the alignment of capital to milestones.

Luckily, we have a bit of experience in fund raising. While we’ve done it once so far (all other companies were successfully bootstrapped) and the main work was done by our third co-founder at the time, we still have some resources we can look back to. This helps in getting the right papers done, covering the important topics. Back in 2012, we had this crazy startup called TreeCrunch, which did natural language processing of answers to open-ended questions. The founders funded the company with a significant amount, we got some grants from some organizations locally and we raised a pre-seed round of about USD $100,000. We have made a lot of mistakes in that process; especially at the time of running the company. We probably asked for too little in terms of funding and after that round, we didn’t continue to raise funds early enough. At the same time, our product and service roll-out was delayed and our customer acquisition funnel was not very successful in turning 30 mostly Fortune500 trial customers into paying customers. Thus, TreeCrunch ran out of money and had to cease operations. Lessons learned: raise enough and make sure to offset your cashburn as early as possible by generating revenue.

Why We Raise

Let’s fast forward 3 years and get back to swapit today. We have learned our lessons from that failure – and I am happy to tell anyone more about that and others over a beer. Now it is about time to get swapit kickstarted.

swapit_marketing-chart-growSwapit is essentially a marketplace app. Every marketplace lives from its marketplace liquidity, i.e. surpass the critical mass of demand and supply. We are at the forefront of marketplaces for pre-loved items in Hong Kong and our technological approach is superior to all of our competitors, regionally and internationally. Yet, that all does not matter if there is no liquid marketplace with active trades happening. We have worked hard to get to the point where we are right now and we are coping well with the ever increasing numbers of traders and transactions.

In order to continue growing at an exponential rate, we need to invest heavily in our marketplace liquidity. That includes fostering and nurturing our community of existing traders as well as attracting new traders to our platform. Therefore, we are planning to spend roughly 75% of the amount we are raising on building that marketplace community. This includes attending & sponsoring events, exhibitions, running events ourselves, attend & exhibit at street markets, as well as general marketing efforts like advertising (mobile, social, offline, print) and merchandise. All that is coupled with incentives to socially share their engagement with swapit and spread the word virally across different social media to their social circles.

Furthermore, swapit is currently Android-only, by choice. While the majority of our target audience are Android users, we do also have a large audience of interested folks who have an iPhone / iPad. Thus, roughly 20% of the funds we raise will go towards creating an iOS app.

swapit-blog_leapThese combined efforts entirely focus on capturing the Hong Kong market to its fullest extend. We believe, the funds will be sufficient to achieve those goals and be the dominant marketplace for pre-loved items in Hong Kong. To accomplish that we need to stop walking and start running. Running fast! Perhaps you’d like to take that leap together with us?

Interested to know more about our funding round?
Send me an email to patrick@swapit.la and I am happy to send you some details directly.

Haven’t tried swapit yet? Download it from http://get.swapit.la

Building A Business Means Every Team Member Is Replaceable

When we are talking to investors, there is a lot of talk about “the team”. That is important, because only the right team, which is skilled, motivated and passionate, can execute a vision properly. In the end, most startups fail because the team stops working together. So it’s important to have the right team on board.

However, I truly believe: Every Team Member Must Be Replaceable

Don’t get me wrong, it is important to get key personnel on board. It is essential to have the right person for the right job. And it is very important to do your best to keep that talent in your company for as long as possible.

That being said, it is absolutely essential to build a sustainable business that functions whether you have this key personnel on board or not on board. At first, this might sound contradictory to the belief that key personnel is essential to the success of a business, but if you give it a deeper thought, it is actually in line with it.

Let me give you an example: I am German. I grew up in Germany and got my degree in Computer Science there, before leaving for China 10 years ago. In Germany the common Computer Science degree holder stays with the same company for an average of 11 years. That’s a quite recent statistic, by the way. Perhaps that’s related to the labour market in Germany or to the not so attractive opportunities in other jobs or it’s just the nature of the Germans; who knows. In Hong Kong however, the labour market is very flexible. There is a lot of competition here and we small startups compete for talent with large multi-national corporations that have deeper pockets. Furthermore, especially the younger generation is in many ways more flaky. They might leave 1 month, 1 year, 2 years after you hire them. What do you do then?

It doesn’t matter if you run a startup or an established company. You never ever want to be in the situation that the departure of some of your key personnel causes an implosion of your business. Remember? Most companies fail because their team stops functioning together.

I recently wrote a blog post about my thoughts on A Product Doesn’t Equal A Business. When you are working on building your startup into a real business, many pieces need to fit together. I believe, one of the most important pieces is: You must make sure, everyone in your business is (more or less) easily replaceable. That includes all employees, key personnel and even the founders themselves. You can not allow to end up in a situation where a key person leaves and your business suddenly can not function anymore. May that person leave due to professional or personal reasons or you have to let go of him/her or *knock-on-wood* due to health reasons. Who knows, anything can happen.

My goal for swapit is, to work with the best team for the job we need and want to do. It is also my goal, that every such team member is replaceable and swapit will continue to thrive anyway.

Wanna join the largest mobile marketplace for trading pre-loved items in Hong Kong? Check out swapit: http://www.swapit.la