Questions

Our service caters to home building, and the age old question appears- do you go after customers that build less homes, but potentially pay you more per home, or go after homebuilders that may pay less per home, but build much more homes (bulk)? Also, this is a new service that will help to sell homes, but also has a bit of early adopter/glamour angle to it, so is it better to land celebrity early adopters that can spread the word, but this may be at a loss in the beginning, or concentrate on doing as many projects as possible to generate cash flow? Next stage is angel investors and VC to scale, as it is a product as a service, so requires some human on-site presence per project.

If you have already validated the product, I would suggest you to do some market research.
What is the high and the low end that the consumers are willing to pay.

1. How many "Bulk Buyers" are out there and how much do they pay you per home compared to how many "High-End Buyers" are out there and how much do they pay you?
2. Whats the Acquisition costs on both these markets?
3. Can you target both at the same time?

The point being that you will need to understand your market better.

Allow me to compare my business to yours and explain. I provide Services in Digital Solutions. In our Market we have clients who are willing to pay $1000 for an iPhone and then I have my clients like CitiBank who paid in excess of $1,000,000.
Theres only one Citibank but theres 100's of 1000's "$1000 clients" You need to decide is it worthwhile to pursue and deliver on those small clients or go for the big fish.
I will need to deliver a 1000 Small projects to compare to what I made in revenue to that one Single big project.

It just doesnt make sense for the overhead I will need to put in to manage a 1000 clients.

In the end you will need to get that same ratio out for your business and then choose the market you want to target.


Answered 5 years ago

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