This weeks 1001 startup idea is to establish a cloud-based software which will serve the following purposes for an organisation.
What is the startup idea?
This weeks 1001startup idea is to establish a cloud-based software which will serve the following purposes for an organisation:
Act as email software for employees;
Act as the software for assigning and reviewing tasks of employees; and
Use artificial intelligence for analysing the data from employee emails and allocated tasks and provide the insights.
According to Research and Markets report titled "Artificial Intelligence Market - Global Forecast to 2020", the artificial intelligence market is expected to grow from USD 419.7 Million in 2014 to USD 5.05 Billion by 2020, at a CAGR of 53.65% from 2015 to 2020.
Statista.com predicts that the cloud software as a service industry will total USD 132.5 billion approx. compared to USD 92.75 billion dollars worldwide in 2016;
spending on public cloud infrastructure as a service hardware is forecast to reach USD 174 billion by 2026;
that worldwide public IT cloud service revenue is predicted to be USD 127 billion;
III. worldwide cloud computing market grew 28% to USD 110 billion in revenues in 2015;
- TBR predicts worldwide public cloud revenue will increase from USD 80 billion in 2015 to USD 167 billion in 2020.
Artificial Intelligence is dubbed as the future and is expected to play a huge role in the HR industry. There are various startups and companies across the globe, which have launched products in the similar segment. Email software like ‘Zoho mail'; companies like ‘Workcompass' which came out with a performance management software and is doing very well.
Pain Point & Target Audience
The target audience would be "Organisations with more than 100 employees". Most of the employee assessment today is done by managers, that leads to complete focus on "the person," with the possibility of bias and complexities because of reasons including their personal "traits" or behaviours. Although these factors are important but these are not the actual measures for efficiency and may not necessarily require for the short term and regular feedbacks.
Organisations are unable to retain talent and employees have remained unsatisfied because of incompetent performance appraisal methods used by organisations. This software will not only be used in day-to-day operations as an email software and also play an important part in assigning and monitoring tasks and group projects. The software will then analyse the data from emails and tasks allocated to suggest the performance of the employee. This software will also give real time feedback to employees so that they can improve their day to day performance.
This will be a B2B software with the subscription based model where businesses will pay monthly or an annual fee. The startup can also provide customised software for consulting companies where the client satisfaction data will be analysed and documented for further reporting.
Some organisations may not be comfortable with changing their email systems, and hence, the startup may consider tying up with big email service provider companies and provide the software as an integration to their email software that is already being offered in the market.
Way to market
The first step would be to create a sleek application which will seamlessly work in relation to the email exchanges and task management. This will be very important criteria as this determines the basic use of the software while the artificial intelligence works at the backend to determine the performance. The integration of task management and artificial intelligence part with third party email service providers will come in handy as that gives access to the bulk clients.
The startup should offer the product to some initial clients at a low cost or free to test the market. The startup should further target selling the software to 10-15 companies initially in the first year. It should also consider the tie-up with a big email service provider like Zoho mail in the first year.
Investment Needed For Prototype
For testing & building the prototype, pitch for raising 100K USD from angel investors or incubators. The startup should reach out to AI incubators like the Alen Institute which was launched by Paul Allen and Element AI launched by Yoshua Bengio, one of the pioneers in deep learning. There should be no office rentals or salary payout; the entire budget should be apportioned for customer acquisition and technology.
You would need to have an HR expert or any HR professor as an advisor from one of the top universities, a tech expert for building the platform and an AI expert for writing the algorithm. In addition to this since this entails managing confidential data having a security and data expert would be highly recommended.
Investors / Expert Take
Investors are funding artificial intelligence startups more than ever. Roughly 400 startups were funded in AI segment in 2015 and 2016 was even better with CBinsights reporting that 200 AI startups raised USD 1.5 billion approximately by June 2016. Some of the top investors in the artificial intelligence industry are Khosla Ventures, Intel Capital, Data Collective, Google Ventures, New Enterprise Associates and Andreessen Horowitz.
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