Fast-growing social media platform to gather and share what's on your mind with people on your wavelength
Business overview
| Location | Sydney, Australia |
|---|---|
| Social media | |
| Website | www.gatheronline.com |
| Sectors | Content & Information Digital Mixed B2B/B2C |
| Company number | 76138111501(Australia) |
| Incorporation date | 15 Jul 2009 |
Investment summary
Idea
Introduction
Gather Online is a social discovery platform where you can meet like-minded people through time-limited conversations on topics that interest you.
Research shows that we never speak to 89% of the connections we add on social media, so these connections aren't meaningful.
To achieve meaningful connections, we need to have direct back and forth communication, but traditional social media creates little urgency, so people tend to become passive consumers of content. Therefore, we believe traditional online groups don’t work for meeting new people - they quickly become stale, with few people remaining active, and little direct engagement.
On Gather, because you are in a conversation group on a topic that interests you, and there is an urgency created by the time limit, we see a lot of interaction and direct engagement with others. Thus people are able to establish meaningful social or business connections, or form romantic relationships with others where they genuinely have something in common.
IMPORTANT INFORMATION
Gather Online is running a parallel crowdfunding campaign on Equitise, a New Zealand based crowdfunding platform, to enable them to access Australian and New Zealand investors. Once the Equitise campaign goes live, Seedrs will reflect the funds raised on Equitise in the Seedrs campaign so that investors are aware of the full size of the round. This will be reflected under the label "Equitise Placement". The terms of the Equitise round are substantively the same as the Seedrs round.
As the Equitise raise will be in New Zealand Dollars, Seedrs has applied a GBP:NZ$ exchange rate of 1.704. This means that any fluctuation in exchange rate between the launch of the campaign and when the shares are issued will not affect the pre-money valuation being offered to investors via Seedrs.
Gather Online is an Australian company and therefore shares will be issued in Australian Dollars at a GBP:AUD$ exchange rate of 1.604.
Intended impact
Founder David Price, an immigrant to Australia from South Africa, lost touch with much of his newly formed Australian network when he briefly lived in the UK.
On returning to Australia, he tried to use existing social networks (Facebook, Linkedin, Match.com etc.) to make new friends, and for business and romantic networking, but found none of them close to satisfactory.
Whilst thinking about this problem, he attended a Sunday BBQ, where he knew a number of people, and found that he quickly met the others. The limited duration of the BBQ – it had a beginning and an end – created an urgency and stimulus for people to interact before losing the opportunity.
David thus set about creating a similar dynamic online – an environment with a limited time duration which would drive people to interact – and Gather Online was born.
Gather is filling the gap in the market for making meaningful new like-minded connections, and is already doing this effectively for thousands across the globe.
Substantial accomplishments to date
• Growth achieved with only desktop website for first 3 months, and mobile responsive site for second 3 months, but no apps (apps launch January 2017).
• Cost of user acquisition <£1 (Only £30k spent directly on advertising to acquire over 30,000 users).
• Churn less than 1% p/m.
• Proprietary artificial intelligence algorithm that attracts users from other social media platforms.
• 2nd and 3rd largest markets for product are US, and UK respectively, where Gather grew organically with no direct advertising spend focusing on these regions.
• The size of popular Gatherings have grown from a maximum of 30 people in month 1 to now over 150 people in a single Gathering.
• There has been a significant rise in the average time spent on the service in recent months.
• We have also obtained significant press coverage in Australia and South Africa and have some high profile and celebrity endorsements.
• We have already partnered with some high profile organisations, such as the South African CFA society, to run virtual overlays for their events.
Monetisation strategy
The basic use of our product for consumers and businesses will be free, but we will be introducing premium memberships with additional features for consumers and businesses. Limitations on usage will ultimately be introduced to the free accounts, and the premium accounts will have no limitations. On the consumer side this will not be introduced until we have significant scale, as it is a friction to growth. However on the business side the packages are marketed directly to the client, so the premium packages will be introduced in the short term.
We will also generate revenue through advertising on our platform. As we achieve user aggregation, advertising could become a significant revenue-generator.
The artificial intelligence algorithm that we use to attract new users to our site, is also being offered to clients (in other industries) as a paid service to attract new customers for them. As this service leverages off the scale of other social media platforms, we already have clients.
Use of proceeds
So far we have focused the vast majority of our spend on building and optimising the technology, including research and testing both the technology and the effectiveness of various marketing messages and channels.
We have only spent £30k (less than 5% of funds raised thus far) on direct marketing and advertising, yet we have already acquired over 30,000 users.
We will use the proceeds of this funding round to go into a scaling phase whereby we will aim to dramatically increase the size of our userbase. Thus a high proportion of funds will be used on marketing and advertising activities.
We are also continuously improving the technology, adding features and refining the overall user experience. There is also ongoing significant spend on our technology team, and we will progressively be increasing the speed of our app.
In addition to the marketing and the technology, there are the usual administrative, legal and management costs which form a smaller proportion of the use of proceeds.
Please note Gather Online has a loan for £36,000 which accumulates interests at 1.4% p/m to an individual third party. The company has an income source against which this debt has priority, which will be used to pay off the debt in full. The income source is a 3 year government innovation grant, whereby the company receives a rebate from the government for R&D expenditure; A rebate of £44,000 was received in 2016 and a further larger amount will be received in August 2017, as eligible R&D expenditure for 2017 has been higher. Thus none of the proceeds of investment are intended to be used to repay this debt.
Market
Target market
Consumer (B2C)
We appeal to users of social networks who want to establish meaningful connections with others who are like-minded, and share specific interests. Everyone has topics that they would like to discuss, and we all like to meet new people who are interested in the same things as we are. We love engaging around certain subjects that we enjoy talking about, rather than just passively consuming content. (Just think how much more fun it is to watch a sports event with friends!)
Around the world, people today want to connect with family and friends through social messaging apps and networks, but it is very difficult to discover new people who share the same passions we do. All over the world, there are people who want to meet others “who get them”. Some people want to connect with others for social purposes, some for business, and some for for romantic purposes. Each of these market segments is sizeable.
Rather than targeting all broad segments at once, we will initially focus on one primary target area, namely university-graduate professionals aged 25-45, with a secondary target market in the under 25 (age-) category. Our application offers users the opportunity to have in depth discussions lasting a few days on any topic in a group environment (though there is also the potential to connect one-on-one). This tends to be more appealing to people with higher levels of education
Business (B2B)
We offer the platform to businesses, for use cases such as a virtual overlay to conferences (with the ability to continue networking and engaging for a few days before and after the event). Many consulting and training firms are also interested in harnessing inter-firm communication with their clients beyond email. There is also a substantial opportunity for learning communities to tailor Gather to enhance their educational offerings.
Accordingly, our target B2B markets are thus large conference organisers, universities, and large consulting and training firms.
Characteristics of target market
The market for Gather is large when one aggregates the Company’s B2C and B2B marketing strategies. 2.1 billion people have a social media account of which 1.7 billion are considered active users, and 2.5 billion people are active social messaging account users. Around 33% of the world’s population use social media and messaging. There are currently 1.65 billion active mobile social accounts.
For social media users, it is often very difficult to meaningfully connect with new people online. Dating websites often carry various stigmas and very low success rates, and most social networks are used to stay in (superficial) contact with others in a passive sense, rather than with the direct back and forth engagement required to truly connect. Social networks, whether it be for personal or business purposes, do not function well as a way to establish meaningful connections with new people.
People who are under 45 are the most accustomed to online social networking. Gather Online fundamentally changes the dynamic of how people connect, by bringing people together around common interests.
While most current social media sites do not cater to connecting people around shared interests, according to Pew’s research, 14% of users state that connecting around a shared hobby or interest is a major reason for them using social media. This 14% number alone is equal to 294 million potential users if this percentage is extrapolated across all social media users. We believe every social media and messaging user could find a reason to use Gather, and is a potential user.
Marketing strategy
We have an online marketing strategy comprising:
• online social media ad spend, and using our proprietary AI to acquire users from other social media platforms,
• building our own communities through our social media properties
• partnering with other significant online content providers.
Our proprietary AI system, called Gather Connect, identifies the conversations on other social media platforms most likely to be contextually relevant to similar conversations occurring on Gather, and can attract those people to participate on Gather Online. Once on Gather, users will have more direct back and forth interactions, as opposed to the more passive consumption of content on the previous platform. This technology is dramatically driving down our cost of user acquisition, which thus far has been around £1 per user.
We also have a B2B strategy with an aim of partnering with 'offline' or real-world organisations that will use and roll out our product amongst their staff, participants and students- e.g. universities, conference providers, consultants and trainers. For instance, participants at a large conference could be invited to participate in a private exclusive Gathering, so they can network before, during and after the 'real-life' event. Participants can interact directly with speakers, and other delegates, and have further discussion about the conference content. These participants will hopefully also migrate to using Gather for social purposes, having seen the power of the platform, and because we already have a lot of other social users of Gather Online.
We have developed connections at over 100 organisations with which we have been discussing use of our platform.
Gather Online has also shown an exceptional virality coefficient. On other platforms users invite a handful of their friends to the platform. On Gather users often create private Gatherings and invite a large numbers of connections.
Competition strategy
By offering a complete platform that allows users to create an endless variety of topics and conversations, Gather facilitates direct, immediate interaction within a limited time-frame, and currently has no direct competition to our knowledge. Popular sites such as Facebook, Instagram, Twitter and Pinterest allow for personal interaction around shared interests, but only insofar as followers see posts on a timeline or a pinned picture. Other platforms generally involve passive consumption of content, (sometimes interspersed by vitriolic comments!) but quickly become stale.
For business-related Gatherings, Linkedin could be considered a competitor in the business networking segment, but it is often more useful for recruitment purposes. By contrast, Gather is perfect way for small business owners, new entrepreneurs or even just someone with an idea to “meet the right people”.
Whilst Reddit helps people find content that interests them, it is really a bulletin board service which allows the posting of items some people consider newsworthy. Reddit is not geared to meeting people - people use pseudonyms and don't connect, and we find its user interface is not as appealing as Gather’s is.
Meetup provides a way for people of shared interests located within a geographical area to meet by joining groups and attending real-life meetings. However, it can be very inconvenient and inefficient to continually attend real life meetings before knowing whether anyone “worthwhile” will be attending. Gather allows people to filter others online, prior to committing time to a “real life” get-together.
Although online dating being very popular with tens of millions of monthly active users, 50% of single people do not use it and a significant proportion cite stigma as the reason. A large 80% of those that try it, stop due to dissatisfaction. Gather Online is designed to be stigma-free because the site is not solely for dating – people naturally meet others whilst pursuing other subjects of interest.
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