Startup pitch: Muber wants to turn travellers into personal Amazon Marketplaces
Muber, an Atlanta, US-based startup, has a take on the sharing economy to get travellers to become virtual delivery companies.
The one-year-old platform works by allowing a person to post a request (to a traveller) to buy products from a destination and receive it back, as well as travellers making their trip plans available online to help people discover them.
Once a traveller accepts a request, the traveller buys the product and organises delivery, whilst Muber arranges the fees and transfer of money.
The company was founded by brothers Leo and Life Lofranco and Francis Plaza.
The idea came about after Lofranco and Plaza travelled to more than 15 countries over the past two years and were asked by friends and family to buy products for when they return home.
(Leo) Lofranco tells us that his father would usually ask him to buy CDs in the US to bring back to the Philippines, while friends might ask for beauty products from South Korea.
Q&A with Lofranco below:
Size of the team, names of founders, management roles and key personnel?
We’re a very small team as an early stage startup. Apart from the founding team, we have an operations head, and a front-end designer.
We are looking for an early stage investment amounting to $150K to help us accelerate our partnerships with travel agencies and also increase our social presence and marketing.
We are also going to use the funding to create a mobile app that will complement our current web application.
Estimation of market size?
Every year there are over one billion international trips around the world. At the same time, 94 million online cross border transactions are happening among major economies.
Muber can leverage, capture and become a reliable and safe alternative to buy the most-sought items.
There are several companies that are similar to Muber. Bistip, an Indonesian company, offers P2P package delivery system and now handles more than 8,200 routes largely going to and from Indonesia.
Mmmule also offers P2P delivery system, however, the value add for its travellers is a social experience instead of a monetary value.
Revenue model and strategy for profitability?
We charge the buyer a 10% commission of the item cost or $10 – whichever is higher from every transaction.
What problem does the business solve?
Muber primarily solves the problem of item accessibility (most notably) in emerging markets like most of SEA and South America.
At the same time, by leveraging the delivery through travellers, it can be a cheaper alternative to expensive international delivery fees.
In the end, Muber lets you get the unique and hard-to-find items you’ve always missed and wanted from anywhere in the world.
How did the initial idea evolve and were there changes/any pivots along the way in the early stages?
Yes, Muber started as a P2P delivery platform. However, after talking to our customers and considering the safety and legal issues involved, we pivoted to a shopping request fulfilling platform via travellers.
Now, travellers buy the requested item, this ensures that they know 100% about the item they’re carrying and also it becomes within their personal duties allowance as a traveller.
Why should people or companies use the business?
Whether it’s chocolate from Belgium, anime comics from Japan or a book you wanted to read in your own native language, Muber lets you get the item while travellers can also earn extra income to cover up their next hotel fees, taxi fare or other expenses.
So, enjoy, earn and socialize more from your travels. On the other hand, the package gets delivered to you personally.
What is the strategy for raising awareness and the customer/user acquisition (apart from PR)?
We are looking towards partnering with travel agencies and airline booking sites to increase our travellers and buyers.
By offering travellers’ discounts or even an extra bag free in exchange for fulfilling deliveries, we can subsequently help airline booking sites increase their revenue.
Where do you see the company in three years time and what specific challenges do you anticipate having to overcome?
We see Muber as a safe, acceptable alternative method to common shopping-delivery platforms. It is not only limited to one’s closest circle of friends or families to transact, but also creates a community of trusted travellers and buyers.
Like any chicken-egg problem of other sharing economy platforms, the matching between a traveller and buyer is the trickiest part that we need to solve.
Sometimes, we get a request but don’t have a traveller to do it or the other way around.
We want to alleviate this by,
a) Partnering with travel agencies
b) Creating an item catalogue to suggest users what items they could actually get from other countries
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
I would say that there is nothing gravely wrong with the current travel, tourism and hospitality industry especially with the rise of diverse travel startups.
Muber is all about making the most out of travel, earning, enjoying and socializing while traveling.
What other technology company would you consider yourselves most closely aligned to in terms of culture and style… and why?
Airbnb – It is not only because we both are in the sharing economy space, but also our team closely follows the styles and tips that Airbnb founders followed when they started.
In fact, we had an encounter with one of Airbnb founders, Joe Gebbia, where we shared our thoughts and challenges that we faced so far. Gebbia gave us useful tips and advice that until now we still continue to follow and emulate.
Muber has an interesting business model and revenue model.
The “need” for a platform like Muber sounds convincing. With a small sample size of my Facebook friends (about 900) , I have seen many product-purchase-delivery requests being posted.
Muber’s pivot from a delivery based model to “purchase & delivery” model eliminates a number of questions/issues about the platform.
However, the platform is not without issues. There might be a lot of initial hiccups similar to what Airbnb experienced when it launched. For example, Traveller A purchases an iPod, but while handing over it is broken or doesn’t work. Who takes the responsibility in this case? (but, a quick read of Muber’s FAQ section says that the company will fully refund the money to the buyer)
It might take sometime for the platform to gain momentum or market acceptance because customers will have to get used to this new way of buying products.
Vine video of Muber
Karthick was general manager for Tnooz in Asia until September 2014.