- The Open Letter
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- š Big Fish, Small Pondā¦
š Big Fish, Small Pondā¦
Plus: Africaās biggest drone, audiences up for grabs & finding your growth users.
Hi there,
User woes? Canāt be as bad as Meta who had to apologise last week after its auto-translate inserted the word āterroristā into some Palestinian Instagram profiles.
In this Open Letter:
Big fish, small pond: An industry to get into early.
The biggest drone, graphite wars & lekker beaches.
Must-havers: How to find your growth customer.
Where we keep our money: The results are in.
TRENDING NOW
Getting in Early
Ever heard the saying ābig fish in a small pondā?
One of the most successful founders youāve never heard of, World Economic Forum Young Global Leader and Treeshake founder Dave Duarte, attributes his success to getting into social media decades ago before anyone took it seriously. Today heās a megatrends specialist who earns top dollar.
The moral? Startup success = be the first and become the best in a small, growing industry you know is going to be big.
Everyone sees the big market, but few see the āsoon-to-be bigā market.
And if thereās one thing we know for sure, itās that electronic vehicles (EVs) are coming.
Itās small now, butā¦
We spoke before about how EVs in South Africa could free up billions in disposable income. And, yes, itās pretty small now, but SA had the 7th highest increase in electronic vehicle sales in the world this year.
So thereās reason to think the EV market could start stirring:
For the first time, AutoTrader included EVs in its Mid-Year Car Industry Report.
EV sales have grown by 106% for new vehicles and 108% for used ones in 2023.
The numbers are still small ā just 131 used EVs sold Q1 & Q2 2023 ā but climbing.
EVs are still about 3.5 times more expensive than combustion cars, so we need better pricing.
In Europe, 13.6% of all new car sales are electric vehicles ā should SA reach the same levels, that could constitute 71,800 new electric vehicle sales per year.
But then thereās the big olā Eskom elephant in the roomā¦
How are we gonna charge āem?
Funny enough, SAās 170 public chargers back in 2021 was one of the worldās highest number of chargers per car ā because no one owned EVs yet. Now, however, weāre falling behind with our mere 435 as EV sales have doubled to 1ā200 in the last 2.5 years.
And what about loadshedding? Well, with SAās solar adoption through the roof, it might not be a biggie, since solar seems to be the most cost-effective way to top up your EV batteryās charge.
In short: If youāre looking for a small, inevitable industry to get big in, EVs are a fun, cool and dare we say green-sexy option.
And all the engines go hnnnnnnnnā¦
Local Startups Plugging into the Trend
With its first 8 prototypes already built back in 2015, MellowVans started producing full-on electric delivery vehicles ready for the global market in 2021 in Stellenbosch. These vehicles have a range of Ā±100 km which is enough to do several daily deliveries within small towns or areas of the city.
With customers such as Takealot, DHL and Spar in SA, MellowVans is keen on expanding to Europe where the EV market is rife.
The charging station market was already a $4.1 billion industry in 2022 in Europe, btw, and with rising EV sales locally, weāre going to have to increase our number rapidly to meet demand.
Having identified this opportunity, Zimi Charge provides electric fleet charging solutions for companies that are moving their fleet of vehicles over to electric. With a range of pricing options, companies can either rent it, own it or pay per charge. (Pssstā¦ We have Zimi on the podcast this week ā so be sure to read Fridayās newsletter for more.)
Itās still very early for EVs in South Africa, but expect more EVs to hit the road soon and, if youāre interested in this space, perhaps now is a good time to dive in and get building while the pond is small. We are watching this spaceā¦.
Refer one friend to sign up to The Open Letter and view our top opportunity pick for this trend (and all future trends we cover).
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OVER TO YOU
Do you see yourself driving an EV in the next 5 years?Vote to see what others say... |
IN SHORT
šļø Hoist the Flag. Eight Cape Town beaches have been awarded Blue Flag status by the Wildlife and Environment Society of South Africa after meeting the requirements for Blue Flag status across 33 criteria in four categories. An additional 2 beaches have achieved pilot blue flag status for the 2023/2024 summer season.
š Graphite Fight. South Korea is looking to Mozambique and Tanzania to secure graphite ā a key material used to produce Electric Vehicle battery anodes. This as China tightens its export controls over some categories of graphite to āsafeguard national security and interestsā.
š¹ļø Droning On. The largest drone built in Africa, the Milkor 380, has just undergone its first successful test flight. The drone from Pretoria, with a wingspan of nearly 20 metres is capable of a continuous flight time of 35 hours, 2ā000 km range and can reach an altitude of 9ā000 metres.
š¤ Where itās at. Funding for AI projects hit a staggering $17.9 billion in investment in Q3. This is despite overall startup deals shrinking by 31% to $73 billion from the year before ā including climate tech investing which dropped a cool 40% year-on-year.
ā Access Denied. Turns out we weren't imagining it. The readers on the SA 4x4 forum, have also picked up that the entire News24 seems to be behind its subscriber paywall these days. Looking at the comments, if you can find a business model to make a free news website work, well youād have some readers.
ĀBUILDERāS CORNER
How to Find Your Growth Customer
With the āmust-haveā method
You have your product and some traction, nice! Now, how do you blow the roof off this thing? Turns out true scalability starts with focusing 10ā000% on the exact right userā¦
Make āem bigger, better, stronger ā MORE
This goes back to product-market fit in a big way, but Facebook- and Google-level growth hacker Sean Ellis always said that you can scale almost anything, as long as you can find its āmust-haveā user.
The user for whom the product is a non-negotiable, they absolutely NEED it in their life. End of story. Thatās the user whom, if you can find more of, your product will snowball.
So, how do you find them?
3 Steps to nail down that growth user
1. Start with the ābaitā survey
Send users a survey asking them how theyād feel if you took your product off the market tomorrow. And just give them a few options like ā āhappyā, ānot affectedā, ādisappointedā, and crucially āvery disappointedā.
This was made with DALL-E 3 ā pretty sweet
2. Find your āvery disappointedā 40%
What youāre looking for is for at least 40% of users to say āvery disappointedā. Because that means the product has become entrenched in their every day. Thatās your must-have user, the one you will be focusing on for growth.
But what if itās less than 40% š¢?
3. Segment until you get your 40
If you have less than 40% āmust-haveā users, start segmenting them. If you sent out a survey to mainly, for example, doctors, start splitting them up ā male VS female doctors, by different specialisations, by geographical location, age etc. Keep segmenting your data until you find a segment that has a 40% āvery disappointedā rate relative to the number of users in that specific segment.
Then, brush your teeth and comb your hair, because you just got a new job at a new company targeting ONLY that user segment. From now on, that segment is your new user ā build for them, market to them, and delight them.
With a bit of luck, the segmentās still big enough for what you need, because there and only there (until proven otherwise) is probably where your growth lies.
Got an ideal user hack? Hit reply and let us knowā¦
THE RESULTS
Well, wellā¦ we asked which bank you prefer and FNB wins the majorityā¦
šØšØā¬ļøā¬ļøā¬ļøā¬ļø Capitec (16%)
šØā¬ļøā¬ļøā¬ļøā¬ļøā¬ļø Nedbank (6.5%)
šØšØšØā¬ļøā¬ļøā¬ļø Standard Bank (24%)
ā¬ļøā¬ļøā¬ļøā¬ļøā¬ļøā¬ļø Absa (5%)
š©š©š©š©š©š© FNB (42%)
ā¬ļøā¬ļøā¬ļøā¬ļøā¬ļøā¬ļø Bank Zero (3.5%)
ā¬ļøā¬ļøā¬ļøā¬ļøā¬ļøā¬ļø Tyme (1.5%)
ā¬ļøā¬ļøā¬ļøā¬ļøā¬ļøā¬ļø Lula (0)
ā¬ļøā¬ļøā¬ļøā¬ļøā¬ļøā¬ļø VBS (0)
ā¬ļøā¬ļøā¬ļøā¬ļøā¬ļøā¬ļø I roll with cash (1.5%)
Your 2 centsā¦
āDiscovery Bank as a 2nd accā
āWhat, no Discovery Bank?ā
Whoops, yeah youāre right, sorry Discovery.
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