3 Important Lessons for Founders

I recently had the opportunity to speak the founders of CoachUp, an online marketplace where athletes can connect with private coaches across a variety of sports. The site, which launched just three years ago, has started to see some significant growth in its user base and has attracted some big name professional coaches including Julian Edelman, a wide receiver on the New England Patriots and Steph Curry, the 2015 NBA MVP and NBA Champion. But before CoachUp got to where it is today, the founding team had to take an idea and prove it could be a viable company. Below are three lessons that any entrepreneur should know when pursuing his/her own endeavor.

  1. Be scrappy. In speaking with the guys from CoachUp, it was apparent that part of their success was due in part to their scrappiness. When the company was looking to grow its user base, they didn’t spend a ton of money on advertising but instead used many free resources available to them to reach their customers. They were able to identify watering holes where they could find the right people to fill their database; they went on LinkedIn, Facebook and other social sites and joined the relevant groups to get the word out and this free and scrappy method turned out to be extremely successful.
  1. Experiment to see what works and be nimble when you find out what does. For any innovation driven startup (meaning not a family-owned small business), the company is creating something that likely hasn’t existed before and as such, the only way to find out what really works is to experiment. For CoachUp, this lean method was utilized when trying to attract athletes to the site; initially they believed SEO and online methods would work as they had for attracting coaches, but after trying alternatives such as seeking partnerships with summer camps, the team quickly switched to a more effective method.  
  1. Know your customer and build your product for them. In the early days, CoachUp was able to attract an initial user base of coaches who were willing to sign up to the site without any pressure from the company. This genuine interest demonstrated that there was indeed an opportunity for a business, at least on the coaches’ side of the marketplace. As for the athletes, CoachUp did not offer any freemium type discounts because they wanted to see if the business model was viable from day one, and they found out it was. Once they had customers on both sides of the marketplace, they worked closely with them to build out the product and as such, were able to create a product that customers would like and use. To this day, they continue to request and receive feedback from customers and enhance the site to fulfill their requests.

Four Industries that will Benefit from Virtual Reality 

Virtual Reality: Year 0    

The origins of Virtual reality trace back to the 1950s, but VR technology has experienced significant advancements, drawing the attention the leaders in technology including Facebook, Microsoft, Samsung, HTC and even Apple has started to test the waters. Historically, when you said ‘Virtual Reality’ many people thought of science fiction, but so much has changed since Facebook’s $2 billion dollar acquisition of Oculus Rift – perhaps the most well-known VR headset, which at the time of the acquisition didn’t seem like much more than a successful Kickstarter campaign for a pair of glasses and a plastic box held together with masking tape. According to Neville Spiteri, CEO of WEVR, the number of head mounted displays (HMD) could triple by the end of the year as hardware companies release consumer versions such as Oculus Rift, Samsung GearVR and others.

Currently, much of the focus of VR is on entertainment and gaming; Facebook struck a deal with Lionsgate and 21st Century Fox to offer movies in what will be there attempt at a VR iTunes, the Oculus Store. Neftlix, Hulu, Twitch and others are all planning to offer streaming video services. Similarly, and perhaps the most advanced developments have been in the gaming world. Driven in part by the Unity Game Engine, companies like Kongregrate have been able to develop lifelike video games. While most of the current applications are consumer-focused, there is a significant market opportunity to address the commercial markets. Below are four industries beyond entertainment that will benefit substantially from the use of virtual reality in the years to come.

1. Real Estate

Virtual reality has many practical applications in real estate and will help provide technological advancements to an industry that has not benefited too much from innovation in recent years. Floored allows real estate developers to create simulations of properties to show potential clients before the development is constructed. This allows firms to increase occupancy rates earlier, having tenants bare some of the upfront development costs. Matterport, which recently closed a $30M round led by Qualcomm, has developed a relatively affordable ($4,500) 360-view camera that allows brokers and developers to film real estate property that they can then show potential clients using a virtual simulation. IrisVR has created software that allows architects to easily transform their 3D models into a virtual simulation that they can then show to prospective clients. Companies using VR will have a competitive advantage as they look to differentiate themselves through the eyes of their clients (that was a VR pun).

RE

2. Healthcare

With the size and attractiveness of the market coupled with the desire for companies to apply innovation wherever possible, the healthcare industry should experience significant advancements driven by increased utilization of VR. For the past few decades, there’s been a growing interest in utilizing VR in clinical settings such as therapeutic treatments for PTSD, phobias and even severe pain in burn victims. Imagine instead of having a patient lying on a couch as a therapist verbally walks them through a scenario, the patient can put on a VR headset and operate within a predetermined and relevant simulation. Companies like Virtually Better are creating content that allows therapists to provide a safe and controlled environment to more interactively treat their patients. Using VR for medical education and training is another application that could greatly reduce costs and increase outcomes. For example, according to an article in Fortune, 65,000 elderly care facilities in America spend on average $3,000 per employee to learn tracheal insertion procedures. Next Galaxy is developing a VR simulation that would eliminate the need to travel to specialized training facilities, reducing the cost to only $40 per employee.

HC

3. Travel and Leisure

Companies such as Marriott are using VR to create virtual simulations for guests, allowing users to step into Marriott locations around the world from one of their VR phone booths. Marriott has been testing many new and innovative concepts to keep up with the ‘modern travelers’ needs.’ Similarly, companies like YouVisit are producing virtual travel experiences, working with large travel agencies to promote what they call “try it before you buy it,” allowing travelers to experience a service or destination before the purchase a vacation package. Landmark Entertainment is in the process of creating VR Theme Parks across China as well as a virtual world’s fair. While the applications related to travel are still early, the opportunity seems to exist and perhaps in the future, virtual travel will be a popular alternative to jetsetting.

Trav

4. Education       

Growing up, I didn’t have iPads or technologies beyond a VCR and the original Mac in the classroom, but future generations will benefit substantially from new technologies including VR. The use of technology in schools has become quite mainstream and we can expect this trend to continue as new offerings become available – enter VR educational simulations. Imagine you get to experience the signing of the declaration of independence instead of simply reading about it in your textbook. Or imagine you can travel to ancient Egypt and experience the culture and political ecosystems instead of watching a PBS special. SunriseVR has begun developing educational content for the classroom including a field trip to space and a simulation to help students understand the human body on a cellular level. SpaceVR is planning to launch a camera rig into space aboard a resupply mission in December, offering paying subscribers a chance to view space through a VR headset. I was at a hackathon where a team was working on taking video footage of a class and converting it to a VR simulation. With the recent interest in massive open online courses (MOOCs) such as edX and Coursera, which create accessibility to education that was never before possible, these sites will now be able to offer interactive content in VR. The applications in education are seemingly endless.

Edu

Many of these commercial applications exist but the necessary hardware and relevant content have not been made readily available. With the technology evolving so rapidly and becoming more immersive everyday, expect to see more and more companies establish internal VR strategies and many new companies begin to offer VR products with commercial applications.

If you’re interested in VR, shoot me an email (dennis.lally@sloan.mit.edu) and follow me on twitter (@denchenzo)!