“I have an idea for the next Whatsapp!”
“Is this under NDA? “Yes.” My idea is Uber for laundry!”
“It’s kinda like Twitter, mixed with AirBnb, Gumtree and a bit of SnapChat. What you think?”
The infatuation with tech startups, tech investing and technology innovation is currently pervasive in the South African business community. South Africa, or more aptly Johannesburg in particular is slightly late to this global shift in business priorities. We will outline 10 ways to make 100 million rand in tech below.
There is an argument that Uber is partly responsible for this sudden uptick, since it brought Silicon Valley out of the murky world of hard-to-understand sky high valuations and made it something real, that sits in every local businesses person’s pocket and to which people pay their hard earned currency to use on the weekends.
This movement incorporates everyone from the big corporates down to newly minted MBA’s and traditional small business teams.
We at SovTech are big believers that Technology is the best industry to rapidly build a large successful business. The problem is that, it is not as easy as the articles on Business Insider, Forbes and Silicone Cape make it out to be.
Great ideas, new ways to service customers, and business models that are 10x more efficient are all positive contributions to society and the process of creative destruction. That is however only the first step.
In order to actually turn your idea/concept into something successful, that is, a business that makes money and return on investment (ROI) for yourself, your shareholders, investors, partners and employees the idea needs to be able to go the distance.
To see if your idea fits into the model of a scalable tech business here are 10 different business models (almost every idea approximates into one of these rough brackets) and the associated **Highly Estimated** metrics needed to achieve R100M in Revenue. It does not deal with Profit as that is a much more more complicated metric in the tech industry which is best left to another post. Most companies are usually some sort of blend across their internal business lines.
Biz Model Category
Goal: Broadest Exposure Possible To A Market Segment.
Monetisation Model: More Queries = Better Chance Of Users Clicking On A Paid Link.
Key Point: People Are In “Buy” Mode Which Makes Clicks Worth More.
Key Metrics:
Monthly Unique Visitors/Queries Per Month
% Users That Click A Paid Link
Revenue Per Click
User Acquisition Cost vs Returning Visitor
South African Examples*:
(All visitor data estimated using SimilarWeb)
TravelStart: 1.1M Visitors
PriceCheck: 2.3M Visitors
GumTree: 12.8M Visitors
Ananzi: 1.1M Visitors
Goal: Create The De-Facto Interest Community That Fosters Communication Across A Niche Or The World.
Monetisation Model: More Queries = Better Chance Of Clicking On A Paid Link.
Key Point: People Are In “Chill” Mode. Low CPM So Large Scale Is Needed.
Key Metrics:
Unique visitors
Ad impressions
Sell through rate %
CPM (Cost Per 1K Impressions)
South African Examples*:
(All visitor data estimated using SimilarWeb)
WhosWho: 1.1M Visitors
Mixit: 2.3M Visitors (Lower Average Rev Per Click)
: 12.8M Visitors (Lower Average Rev Per Click)
Ananzi: 1.1M Visitors
Goal: Broadest Exposure Possible To A Market Segment.
Monetisation Model: More Queries = Better Chance Of Clicking On A Paid Link.
Key Point: People are in “buy” mode.
Key Metrics:
Monthly Unique Visitors/Queries Per Month
% Users That Click A Paid Link
Revenue Per Click
User Acquisition Cost vs Returning Visitor
South African Examples*:
(All visitor data estimated using SimilarWeb)
News24: 1.1M Visitors
2 Oceans Vibe: 2.3M Visitors (Lower Average Rev Per Click)
: 12.8M Visitors (Lower Average Rev Per Click)
Ananzi: 1.1M Visitors
Goal: Broadest Exposure Possible To A Market Segment.
Monetisation Model: More Queries = Better Chance Of Clicking On A Paid Link.
Key Point: People are in “buy” mode.
Key Metrics:
Monthly Unique Visitors/Queries Per Month
% Users That Click A Paid Link
Revenue Per Click
User Acquisition Cost vs Returning Visitor
South African Examples*:
(All visitor data estimated using SimilarWeb)
BidOrBuy 1.1M Visitors
SafariNow: 2.3M Visitors (Lower Average Rev Per Click)
: 12.8M Visitors (Lower Average Rev Per Click)
Goal: Broadest Exposure Possible To A Market Segment.
Monetisation Model: More Queries = Better Chance Of Clicking On A Paid Link.
Key Point: People are in “buy” mode.
Key Metrics:
Monthly Unique Visitors/Queries Per Month
% Users That Click A Paid Link
Revenue Per Click
User Acquisition Cost vs Returning Visitor
South African Examples*:
(All visitor data estimated using SimilarWeb)
Takealot: 1.1M Visitors
Yuppiechef: 2.3M Visitors (Lower Average Rev Per Click)
Groupon: 12.8M Visitors (Lower Average Rev Per Click)
Netflorist: 1.1M Visitors
Goal: Broadest Exposure Possible To A Market Segment.
Monetisation Model: More Queries = Better Chance Of Clicking On A Paid Link.
Key Point: People are in “buy” mode.
Key Metrics:
Monthly Unique Visitors/Queries Per Month
% Users That Click A Paid Link
Revenue Per Click
User Acquisition Cost vs Returning Visitor
South African Examples*:
(All visitor data estimated using SimilarWeb)
TravelStart: 1.1M Visitors
PriceCheck: 2.3M Visitors (Lower Average Rev Per Click)
GumTree: 12.8M Visitors (Lower Average Rev Per Click)
Ananzi: 1.1M Visitors
Goal: Broadest Exposure Possible To A Market Segment.
Monetisation Model: More Queries = Better Chance Of Clicking On A Paid Link.
Key Point: People are in “buy” mode.
Key Metrics:
Monthly Unique Visitors/Queries Per Month
% Users That Click A Paid Link
Revenue Per Click
User Acquisition Cost vs Returning Visitor
South African Examples*:
(All visitor data estimated using SimilarWeb)
ShowMax: 1.1M Visitors
DropBox: 2.3M Visitors (Lower Average Rev Per Click)
CarTrack: 12.8M Visitors (Lower Average Rev Per Click)
Yellow Pages For Business: 1.1M Visitors
Goal: Broadest Exposure Possible To A Market Segment.
Monetisation Model: More Queries = Better Chance Of Clicking On A Paid Link.
Key Point: People are in “buy” mode.
Key Metrics:
Monthly Unique Visitors/Queries Per Month
% Users That Click A Paid Link
Revenue Per Click
User Acquisition Cost vs Returning Visitor
South African Examples*:
(All visitor data estimated using SimilarWeb)
Hippo: 1.1M Visitors
PriceCheck: 2.3M Visitors (Lower Average Rev Per Click)
GumTree: 12.8M Visitors (Lower Average Rev Per Click)
Ananzi: 1.1M Visitors
Goal: Broadest Exposure Possible To A Market Segment.
Monetisation Model: More Queries = Better Chance Of Clicking On A Paid Link.
Key Point: People are in “buy” mode.
Key Metrics:
Monthly Unique Visitors/Queries Per Month
% Users That Click A Paid Link
Revenue Per Click
User Acquisition Cost vs Returning Visitor
South African Examples*:
(All visitor data estimated using SimilarWeb)
SnapScan: 1.1M Visitors
Zapper: 2.3M Visitors (Lower Average Rev Per Click)
Mpesa: 12.8M Visitors (Lower Average Rev Per Click)
Banks: 1.1M Visitors
Goal: Broadest Exposure Possible To A Market Segment.
Monetisation Model: More Queries = Better Chance Of Clicking On A Paid Link.
Key Point: People are in “buy” mode.
Key Metrics:
Monthly Unique Visitors/Queries Per Month
% Users That Click A Paid Link
Revenue Per Click
User Acquisition Cost vs Returning Visitor
South African Examples*:
(All visitor data estimated using SimilarWeb)
Altech Node: 1.1M Visitors
: 2.3M Visitors (Lower Average Rev Per Click)
GumTree: 12.8M Visitors (Lower Average Rev Per Click)
Ananzi: 1.1M Visitors
Contact SovTech today for your custom software solution
*This blog post is not meant to be a conclusive study of all technology business models or the sub-sectors, nor are the numbers always going to be an accurate reflection of a business in its unique market. The ways that the numbers interact is sometimes more interesting than the actual absolute figures. They are simply meant as a toolbox to understand and evaluate potential ideas with some standardisation across models.
* We are not liable if you assume your idea or angel investment will actually work using any of the metrics listed above.
