The startup will set-up a network of stations from where the users can borrow a portable charger and then can return to a similar station after charging their phone. The users will pay a monthly subscription for this service.
What is the idea?
The startup idea is to provide a subscription-based mobile battery charging service. The startup will set-up a network of stations from where the users can borrow a portable charger and then can return to a similar station after charging their phone. The users will pay a monthly subscription for this service. The user will be able to borrow one device at a time under one subscription.Market Definition
According to Statista.com:
- For 2017 the number of mobile phone users is forecast to reach 4.77 billion;
- The number of mobile phone users in the world is expected to pass the five billion mark by 2019;
- The mobile phone penetration is expected to continue to grow, rounding up to 67 percent by 2019;
- China had just over 1.2 billion mobile connections in 2014, while India reached almost one billion; and
- By 2019, China is predicted to reach 1.4 billion mobile connections and India almost 1.1 billion.
- Veloxity conducted a research on phone battery usage in 6 major cities in the USA and found that:
- 68% of the people stated that battery life of a phone was not a criterion for purchasing a phone and yet 51% of the people surveyed stated that they have used public kiosk for charging the phone;
- Average phone charging per day per person is 2.7 in New York, 2.1 in Philadelphia, 1.9 in Boston and Chicago, 1.8 in Miami and 1.6 in Washington D.C.;
- 72% of the people surveyed did not carry any backup for charging the phone, 4% carry external battery, 6% carry portable charger, 18% carry a charging cable; and
- In New York, 8.5 out of 10 people had low battery anxiety.
Techtimes.com reported that "Approximately 9 out of 10 or 92% of the 872 smartphone owners surveyed said they would feel stressed if their phone's battery died out on them and there is no charger nearby, says Mophie, a maker of smartphone cases that can extend a smartphone's battery life."Competitor Analysis
Various companies are trying to solve the problem of battery by offering various kind of solutions. These solutions are mostly in the form of innovating batteries. In our research, as an exact competitor to the proposed, we found only Chargifi, which is setup in United Kingdom. Chargifi, however, has a different business model. It works with business owners who sign up with chargifi to provide this service to its customers.
The targeted customer market for this business is the "mobile users looking to charge their phone batteries on-the-go". The mobile phone has become a part of life for its users. Intelligent Energy conducted a study and found that two-fifths (39.2%) of consumers find battery life the most frustrating aspect of their smartphone. Techtimes.com reported that "Aside from stress, 61% of those surveyed said they would feel frustrated if their smartphones run out of battery, while some 25% reported they would feel panicked".
The challenge faced by users is that they need to carry either a power bank which they again need to keep charged or use public kiosks for charging (where they have to stand and charge).Value Proposition
This startup gives the power in the hand of the user to access power banks and charge phones on the move and also not worry about keeping those power banks charged. The users never have to worry about charging the phone or the battery running out. All the users will have to do is put an amount as security for using power bank, which could be as low as 10 USD and pay a monthly subscription of a minimum amount, like USD 2 for having access to power banks.
The user will download the app where it can register and check out the nearest power bank station to collect a power bank to charge their phone. Users can also return the used power bank at any such station.Business Model
The startup business model is B2C subscription based. Each user will pay a monthly fee to have access to power banks. The startup can have various plans where it can restrict the number of uses for every subscription plan. This startup model is almost like the bicycle system in London.Way to market
The startup will have to start from any one major city. It should start with a city which has good public transport connectivity like train connectivity and install automated machines at train stations. It will have to ensure that the registration is done on mobile apps and the machine is used only for power bank collection and deposit. This will ensure no queues at the power bank stations. The user should only scan a barcode on its phone and collect or deposit a power bank.Milestones
If the startup starts from one of the major metropolitan cities of the world, it will be easy for it to get user base. It should target having at least 100,000 users in the first one year. This will not only show the scalability of the model but it will also ensure that the startup has enough revenues for it to expand. 100,000 users mean 2.5 million in revenues every year (if every user pays USD 2 per month) which will ensure that the startup may be able to scale without needing much external investment.Investment Needed For Prototype
For testing & building the prototype, pitch for raising 200K USD from angel investors or incubators for purchasing automated machines and power banks. Top tier incubators like Y Combinator, 500 startups, Alchemist, Angelpad and Techstars should look at this business model very favourably. There should be no office rentals or salary payout; the entire budget should be apportioned for customer acquisition and technology.Team Capability
You would need to have a marketing expert as a co-founder. Another member with a good operational exposure would be an advantage.Investors / Expert TakeChargifi, one of the competitors for this business, raised USD 2.7 million in 2015 in a round led by Intel Capital. Subscription based models not only prove the demand for the product but also give a comfort to the investor that the business is scalable. This startup aims at a very niche problem faced by billions of mobile users across the globe and data shows that there is demand. In case you are looking to build upon this idea or need support to start this business, please do write to us at yostartups.com and our team will be happy to provide assistance.