There are 23 million small businesses in America, and 543,000 more
are started every month. So if you've got a business idea and you want to stand
out from the crowd and succeed, you better have a unique value proposition,
diverse revenue streams and loads of creativity. To inspire you, we've rounded
up 17 unique businesses that have proven their model works. From retail apps to
fashion upstarts, these companies are rethinking revenue and creating
compelling value for parties on both sides of the transaction.
Tell us what you think is the most unique business model in
the comments.
Skillshare launched as an a la carte education marketplace —
experts could teach a class on any subject, and anyone could attend, for $20 or
$25. But this past March, Skillshare pivoted to a $10 per month, all-you-can-eat
model. And unlike most education startups, Skillshare doesn't use professors
from top-notch universities; you need not be a Ph.D. to be able to teach
something useful. And on the student side of things, it's easy — and relatively
inexpensive — to become a lifelong learner.
Lesson: Leverage
the intelligence and expertise of normals to create a massive intellectual
marketplace.
2. Stitch Fix
Founder and CEO Katrina Lake says
Stitch Fix's "combination of the art and science hasn't been seen before
in retail industry." Her startup's proprietary algorithm is constantly
processing the responses to new user style surveys — and feedback on the items
they receive — to help Stitch Fix's 300+ part-time stylists in California and
Texas assemble "fixes" (boxes of five items) that users are almost
guaranteed to love. "There are no other services that provide a truly
personalized retail experience at the affordable price point that we offer at
Stitch Fix," says Lake.
Stitch Fix originally targeted the mid-20s urban professional who has a demanding job and doesn't have much time to shop, but appreciates being on-trend and looking nice. As the company grew, it became clear to Lake that "the profile of a time-starved woman is universal," and it applied to stay-at-homes and C-suite executives alike. "We're able to take one thing off their plate by delivering a fun and delightful retail experience that’s truly personalized for them," says Lake.
Stitch Fix originally targeted the mid-20s urban professional who has a demanding job and doesn't have much time to shop, but appreciates being on-trend and looking nice. As the company grew, it became clear to Lake that "the profile of a time-starved woman is universal," and it applied to stay-at-homes and C-suite executives alike. "We're able to take one thing off their plate by delivering a fun and delightful retail experience that’s truly personalized for them," says Lake.
Lesson: A
product that uses smart data to surprise and delight — and save consumers time
— is a win.
The influence of Warby Parker is undeniable, and tech
reporters everywhere are reminded of that daily when they're pitched "The
Warby Parker for [insert stale industry here]." Warby Parker's
undercutting of the Luxottica empire's price points and special collections
have turned glasses-shopping into something more like shoe shopping: They're
only $95, so sure, I'll take a pair in blue, too. What started as an
ecommerce venture now has brick-and-mortars that outpace Tiffany and Co. (and
have bouncers and lines on weekends) and has spawned pop-ups at America's
coolest locations, from The Standard toAlchemy Works.
Warby Parker eliminated the middleman and added not only an immense cool
factor, but also a social good element, and nothing piques the modern
consumer's interest more than lower prices, trendiness and the feeling that you
did something good.
Lesson: Change
the way people see an industry.
4. Paperless Post
Paperless Post started in 2008 as
the U.S. Postal Service's biggest enemy — it encouraged people to email
invitations and announcements, made pretty with hundreds of design templates.
The site was free to use, though premium templates and envelope liners required
prepaid "Coins." In late 2012, to open another revenue stream, Paperless
Post embraced paper after all, letting customers design a card
at PaperlessPost.com and then send it electronically, via snail mail, or both.
Alexa Hirschfeld told Mashable that 60% of Paperless Post
users wanted paper stationery. "They've told us that they love Paperless
Post, but there are certain times that they really need to use paper for its
archival quality, for its ability to be saved and scrapbooked." Meanwhile,
digital innovation didn't stall. Paperless Post has upped its aesthetic ante
via revenue-share partnerships with J. Crew, Oscar de la
Renta and Kate Spade, who lend designs to the site's templates.
Lesson: Aesthetics
matter.
5. Zady
Zady champions conscious consumerism and aims to change the
way we think about the fashion industry, particularly fast fashion. Founders
Soraya Darabi and Maxine Bedat focus on high-quality, hand-crafted goods that
are ethically produced (think: vegan leggings), locally sourced,
environmentally conscious and made in America. In their eyes, less is more.
Lesson: Storytelling
— and the goods' path to consumers — matters, and people will pay a premium for
it.
6. Handybook
We're living in an on-demand era. We
want things and we want them now. Handybook has emerged as a more user-friendly
instant-gratification-enabled Angie's List. It operates in 26 cities and
recently raised $30 million to grow the team, specifically the mobile
engineering department. Hanrahan toldMashable, "The way we set up
Handybook is to think about all the services you need inside your home and how
we can be a remote control for managing those services." Looks like people
are clicking that remote — Handybook has more than 10,000 bookings a week, of
which the company reportedly keeps 20%.
Lesson: Convenience
is key.
Popsugar's content covers everything its target demo is
interested in — entertainment, celebrity, fashion, beauty, fitness, food and
parenting — in a variety of formats, including online, in-app and on TV. In
2007, the company acquired shopping search engine ShopStyle, and piggybacking
off the Birchbox trend launched Popsugar Must Have, a subscription box
curated by Popsugar editors. It's become a global lifestyle brand with 41
million unique visitors and 234 million pageviews monthly.
Lesson: Content
drives commerce, and people love a one-stop shop.
8. NatureBox
Naturebox is taking on the $64 billion snack food category
that to date has been chock-full of manipulative food science and
unhealthy additives. To date, NatureBox has developed 120 snack varieties and
shipped 1 million boxes. Half the subscribers are in the Midwest, where access
to organic markets and Whole Foods is limited. "We solve that problem by
sending better options straight to their doors," says NatureBox's Amanda
Natividad. "We empower our happy snackers with choice," and an
algorithm that considers dietary preferences and snack popularity determines
what arrives in members' boxes. The company saw 20x growth in 2013, and traffic
to the site's blog has grown steadily, indicating an increasing
interest in learning about healthy eating.
Lesson: Making
your own product gives the business an edge unparalleled by competitors who curate.
Hukkster's giving consumers the advantage when it comes to
shopping. The startup's Hukk It Chrome extension creates a one-click experience
for tracking coupon codes — in real time — for the items you want, whether it's
apparel, accessories or housewares (70% of discounts in the marketplace are
coupon code-based). Hukkster tracks coupon codes and sales at the SKU level and
then sends real-time alerts to shoppers. The open rate for these emails is 70%,
says Bell, adding that it's a win-win for everyone — Hukkster "works
directly with the brands to help drive traffic and sales in-season at healthy
margins and shoppers can gain access to the products when they're interested in
them." For now, Hukkster is paid an affiliate fee when shoppers purchase
through the platform (partners pay increased commissions for better and
customized sale alert emails), though Hukkster is "excited to work with
[brands] directly down the road," when it has a canon of data surrounding
purchase intent. Helping the company gather data is a new app with a
Tinder-like interface, wherein shoppers swipe left to "hukk"
something and right to pass.
Lesson: Shoppers
like saving money; helping them do it means everyone wins.
10. Zola
A cohort of Gilt veterans
(founder Kevin Ryan also founded Gilt Groupe, among other New York startups)
decided the wedding registry had become stale and unimaginative. As Pinterest
was helping spouses-to-be develop creative wedding ideas, the registry process
remained boringly point-and-scan. The founders came up with Zola as a new
alternative, designed for millennial fiancees that enabled couples to create a
registry that offers freedom and personalization. Zola was projected to have
3,000 couples use the service in year one, but the team already has 16,000
engaged couples just seven months in (Ma credits word-of-mouth, since friend
groups tend to marry in waves). Ma says the top-selling items are the Lodge
Cast Iron Skillet, waffle makers and lasagna dishes, which are "most
likely tied to the popular brunch and easy-to-prepare meal trends," says
Ma. But she's also seen immense interest in registering for experiences, like
meal-delivery services, cooking classes and honeymoon activities. This gifting
trend "supports our bigger belief that couples today want to register not
just for tangible products, but also for experiences that allow them to spend
time together and keep date night alive," says Ma.
Lesson: A
beautiful interface and the ability to customize go a long way, as does
reinventing the traditional way of doing things.
11. Oyster
Subscription ebooks have become a
trend, but in the past year, Oyster has emerged as a runaway success. In 2012,
the social reading startup raised $3 million in 2012 from Founders Fund, and
since then — in addition to raising another $14 million — the service has
amassed 500,000 titles, including new releases, New York Times bestsellers
and National Book Award winners from more than 1,600 publishers. The monthly
subscription is $9.95, which is far less than the price of a single book, hardcover or paperback.
Lesson: Embrace
the direction of media consumption habits, make the price undeniable.
12. Uber
Despite legal woes and backlash toward surge pricing,
Uber has become a fixture in some of the world's biggest cities. To date, the
company has raised $1.5 billion and has hinted at expansion to other logistics
markets, like same-day delivery and errands, a space it's experimented in with
activations likeGoodwill pickups and ice cream delivery. With so many
cars on the road to do these tasks, should Bezos watch his back?
Lesson: Innovation
is an uphill battle, but it's one worth fighting.
13. Serengetee
Each of the pocket patterns on a Serengetee tee originates
from a place the founders have visited and is tied to a social cause in the
region. Customers personalize shirts (base color + pocket pattern) and thereby
support a cause, thus becoming tied to and invested in global issues.
"Our message is not that we can save the world but we
can definitely change it through a sustainable business model," says
cofounder Ryan Westberg. Serengetee gets the word out to college kids through a
campus rep program, which reached 2,500 this summer.
Lesson: Millennials
like customization and social enterprises — and they'll evangelize for you.
The Los Angeles-based retail company
began not as a fashion label, but as a self-publishing platform where
style-minded users could create their own "tear sheets." Those tear
sheets were then used by founder Allison Beal as inspiration for the inaugural
StyleSaint collection, an apparel canon she could be sure would resonate with
her community in a model she calls "creator-to-closet." Today,
StyleSaint makes new collections every six to eight weeks based on those tear
sheets, and uses $10.1 million of venture capital to fuel growth. The
direct-to-consumer approach, founder Beal says, helps to reduce excess
inventory and eschews fast fashion in favor of quality goods.
Lesson: The customer is right, especially when it comes to her own
taste.
15. Airbnb
Like Uber, Airbnb is not without its legal troubles, but the
"space marketplace" is a $10 billion business that has
become the poster child for the sharing economy (see also: Rent the Runway, Lyft, Neighborgoods,
etc.) and the behavior known as "collaborative consumption." The site
hosts 300,000 listingsand has helped more than 4 million travelers book
stays. Not content with just the space booking element, the site is also experimenting
with group dining experiences.
Lesson: Sharing
is caring — peer-to-peer models save consumers money, help owners make money
and create a more authentic, local experience for travel.
16. Rent the Runway
The rise of Instagram and Facebook photos means the pressure
is on to look and feel great at events ... and to not repeat an outfit. Rent
the Runway was founded after a closet-full-of-clothes-and-nothing-to-wear
moment so women could have access to the red carpet looks they see on
celebrities, without breaking the bank (rentals are typically 10-15% of the
dress' ticket price). But unlike other discounted apparel sites, Rent the
Runway doesn't offer last season's goods — it buys in-season merchandise like
Bloomingdales or Neiman Marcus do, and rents the items out to different
consumers every week, so it recoups the cost of the items and functions
as a gateway for women to get into luxury brands. The company started online,
but has experimented withpop-ups to overome consumer hesitations and
ensure a perfect fit (therein lies the biggest risk of Rent the Runway, though
its consumer feedback dataattempts to give women the skinny on how items
fit). The rent-not-buy model has been mimicked in other categories by brands
like The Black Tux, Chic by Choice and Eleven James and has
plenty of potential for expansion.
Lesson: Aspirational
fashion and try-before-you-buy are potent sales drivers.
17. Birchbox
How could we not include the mother of all subscription
services, Birchbox? The beauty startup spawned an entire industry and
influenced several of the businesses on this list. Birchbox introduced us to
expert curation, the joys of surprise and delight and the idea of discovery
ecommerce. And its growth has attested to the fact that it's working — $71.9
million in funding, the bulk of which came this past April after a
successful holiday season. "We still feel like we are in the earliest
innings, but this is a moment, this is an inflection point to invest in and
really push hard when we are seeing traction, momentum and excitement,"
Katia Beauchamp told Mashable.
Lesson: A
little curation goes a long way in a crowded industry.
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