In my final year of university, instead of writing a dissertation, we had a final year project. Our project was to come up with a business idea and pitch it. It was broken down into 3 main tasks over the academic year.
Task 1 was to come up with the idea and explain it in about 250 words, discuss with classmates and submit to the lecturer and get some feedback.
It was a great opportunity to work on an idea, and evolve it over time based on feedback.
The most challenging but helpful aspect of the project was the constraints provided and figuring out how to navigate them.
Task 1
The idea: This idea is based on the belief that the car usage and accessibility experience can be much simpler and easier. The aim is to create a platform that allows individuals to pay a monthly subscription fee to access the best cars available. With medium to longer term monthly subscription options users can have access to the car(s) of their dreams. They have access to as many cars as they want. They can send a car back and replace it with a different option on the platform. They can use a Tesla model S for a few months and then switch to an BMW i3. All insurance and other car costs are included in the package. All the customer has to do is pay and drive the car.
Business Model Innovation: An offerdriven and customer driven business model innovation that serves those who wantthe benefits of using a car, without having to own one offering them not onlyease of use but access, which would be much harder to gain otherwise. It’stantamount to buying a DVD vs. paying for a Netflix subscription and havingaccess to as many films as the platform offers.
The longer term vision: A platformthat ushers in the future. One that is compatible with the cars of the future,a model that works for the self-driving and innovative cars to come when theyfinally hit the market.
The business environment:
Examples: https://www.wagonex.com – Auk company that does this
http://press.porsche.com/news/release.php?id=1050 – Porsche recently launched a subscription model.
Feedback:
“A very well presented report. You have done a lot of background research that shows this type of model is emerging. My problem is, within the financial confines of this module and time confines, I want you to demonstrate to me not just the idea but some evidence that the idea has been tested somehow and I can’t see how this will fit within this criteria. It’s complex. There are already companies doing it and a broker will need to attract car makers or major car dealers to provide the cars. Will they want to do this to a start up or will they prefer to risk their brand names? Like porsche they may want to DIY and protect their brand names.
You also need to gather underwriters for quite a complex insurance process so I would make drivers get their own insurance as the margins on insurance for brokers like you are small and not worth the effort. So we are left with a platform that provides choice but will the finance companies allow such short term switching (this is where the financial conduct authority also are involved)…more complications.
So, it will take you a long tome to develop these relationships to provide an offer on your platform before you can even start attracting customers who are already locked into mainly 42 month contracts.
This could work if you use second hand cars and a select number of dealers in a local geography…where you can manage the relationships and then perhaps it can be franchised, but doing this with brand new luxury car is a big risk for those brands.
Good luck.”
Featured image – Photo by Nabeel Syed on Unsplash
How to entrepreneur 