The Facebook for businesses that aims to build a network of 25m businesses in US and Europe.
Business overview
| Location | London, United Kingdom |
|---|---|
| Social media | |
| Website | www.netberg.com |
| Sectors | Recruitment & Procurement Mixed Digital/Non-Digital B2B |
| Company number | 8477606 |
| Incorporation date | 8 Apr 2013 |
Idea
Introduction
Did you know that over 70% of businesses are not online? Between Western Europe and the US over 25 million businesses do not have a website. Don't you think that every business should have its own website and that it should be easy to find it?
At Netberg we believe that stand-alone business websites belong to the past. In fact, many businesses do try to reach more customers by creating their own websites, but often they cannot reach those customers without investments in SEO and advertising.
We believe that Netberg has the ultimate solution: we remove all barriers to entry for SMEs to go online. These are time, budget, IT skills and visibility. We create, own and manage a network of business websites, allowing consumers to find businesses and their products by searching relevant criteria. Moreover, we feel our approach makes e-commerce easy like never before: collecting payments and arranging pick-up and delivery so that businesses do not need to worry about anything.
Netberg’s social mission is to empower SMEs to stand together on the internet, so that they can benefit from accumulated traffic to gain relevance; our vision is to become the world’s essential online network for all businesses to join.
Intended impact
Think of us as the Facebook for businesses or the business directory of the 3rd millennium: Netberg aims to be the place where consumers look for businesses and their products, and the platform that businesses join as soon as they are incorporated.
Substantial accomplishments to date
- Graduated from the Accelerator Academy, a tier 1 accelerator programme in London, UK.
- Selected to participate to the Summit Dublin through the ALPHA programme as one of the most promising start-ups.
- Selected as one of the 6 finalists as "European Innovator of the Year 2014", live at the European Parliament.
- Collected data for over 60k businesses between Italy and the UK, 10k already live on Netberg.
- Private MVP published in February 2014, public MVP published in May 2014.
Monetisation strategy
- Netberg is a network and a marketplace, and therefore it has two types of customers: companies and internet users. As you need a good number of businesses to make the platform usable for buyers, we have built our own spider to collect data of businesses already on the internet. We then cleanse it and re-package those data into websites. So they can already be used by internet users and claimed by business owners.
- Netberg is based on a freemium model: we deliver value first (free website), we charge for commissions (7% on sales on the platform) and upsell premium later. Our current premium services include: Netberg-made website (if the business owner does not want to spend even 5 minutes doing it, we do it professionally charging £60), Professional package (domain www.yourbusiness.com + ads removal, £30/year), Visibility package (featuring on newsletter and homepage, charging £30/month). We have a number of future developments planned including: inventory management, e-mails, website translated and maintained in multiple languages, etc.
Use of proceeds
We plan to use the funds as follows:
- Product development (iOS, Android and Windows Phone mobile apps, platform and website)
- Business and customer acquisition (PR, business fairs, digital marketing, SEO)
- Sales and marketing wages
- Fixed Costs (rent, food and drinks, office equipment, legal and accounting fees)
- Directors' wages
- Cost of fundraising
Market
Target market
- 78% of consumers use the internet to search for products and services. However, despite e-commerce being expected to grow by 57% in 3 years, in any country of the world over 70% of SMEs do not have a website.
- In the UK and Italy, the first two markets we are targeting, percentages are respectively 73% and 83%: this means that approximately 3.5m businesses in the UK and 3.1m businesses in Italy run without a website.
- Between the US and Western Europe (France, Germany, Spain, UK and Italy) our addressable market counts 25m companies.
Characteristics of target market
Netberg has studied the market in depth, using both primary and secondary sources.
In our business surveys in central London, we found out that over 40% of the independent businesses do not have a website.
Once again, the market is huge. Many SMEs are simply not taking full advantage of the internet. The Boston Consulting Group, in one of their published papers, stated that:
- High-web SMEs have experienced revenue growth that was up to 22% higher than that achieved by SMEs with low or no use of the web over the last three years.
- In the UK sales at high-web companies increased 6x as fast as revenues at firms with no internet presence.
- In Germany 93% of high-web companies increased employment over the past three years, compared with only 50% of the no-web firms.
The current offerings to date have helped get 27% of the market to go online in the last 25 years. Today something different is clearly needed to raise the bar to the next level. That is our ambition.
Marketing strategy
After the web is crawled and our pipeline is filled in with business information, we aim to engage our customers through marketing activities.
Our business acquisition strategy is based on two channels: indirect and direct:
- In the indirect channel we will aim to partner with governmental bodies that have an interest in developing the SME sector, and with trade associations that want to deliver value to their affiliated businesses. It is with this strategy that we signed an agreement with Confcommercio, the Italian largest trade association with over 700k associates.
- In the direct channel we aim to approach businesses directly with a number of online and offline marketing activities.
Our buyer acquisition strategy is instead almost entirely based on digital marketing: advertising, social media marketing, content curation on our blog, and SEO.
Competition strategy
We believe that Netberg is creating a new space in the market: a network of business websites. This space sits in the middle of three types of competitors:
- Business directories (e.g. Yelp, Yell.com)
- Website generators (e.g. Shopify, Tictail)
- E-commerce platforms (e.g. eBay, Amazon)
We differ from them for the following reasons:
- From business directories because Netberg is a platform containing business websites (not listings) and managed directly by those businesses. Additionally Netberg includes e-commerce, therefore users can find businesses and buy from them too.
- From website generators because Netberg does not require any IT skills at all (if you can use Facebook, you can use Netberg) and in addition all of the websites are interlinked with each other in a network.
- From e-commerce platforms because Netberg has a lot more than just a list of products. Geographical location and business identity matter. Furthermore, we feel that Netberg can offer a lot more for businesses: for the first time selling online does not require a credit card reader nor a PayPal account nor an agreement with a courier. Netberg collects payments and arranges pick-up and delivery: all included in the price.
Being a network, Netberg automatically creates barriers to entry for new competitors. The bigger the market share we gain, the harder we feel it will become for competitors to win it back.
The final objective is to help businesses connect to consumers anywhere in the world, solving the problem of the SME community’s slow reaction in embracing the digital revolution.
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