The idea for neighbor has evolved over time but the core concept of peer2peer delivery came when I was studying abroad in Shanghai and realized how great but still chaotic the delivery system is over there. Labor is very cheap and due to this there a tons of delivery drivers on motorbikes delivering anything throughout the city for a very little fee. I was wondering whether this concept would work in more developed places but realized quickly that due to the higher cost of labor this won’t work unless people are not doing it as a job but on their daily commutes and errands.
However, with the increasing competition and the fact that a lot of stores already are on board of a couple of delivery system I thought it would be hard to go straight to city to try the p2p approach. In addition, I believe the user education aspect would be incredible expensive in a city. However, I thought colleges and closed eco-systems might be an interesting area to start and try the concept. This is where we are now.
The advantage with a university is also that we just need to talk to a couple of people to onboard every store since they are generally run by one entity even though they are different brands. In addition, another aspect of easiness is that students use meal plan currency and by being able to process the meal plans we save on credit card transaction cuts. However, all these advantages have turned also in quite some pain points. Yes, you need only get one partner at a school. But since this partner is big and powerful we have way less leverage and negotiation power as if we were talking to little stores individually. The same applies to the meal plan provider. There are about two large companies in the US that are providing the software to almost all universities. Getting them to allow us to use their API is more challenging than expected.
Lastly, let me give an update on the week. I have been the last week in Germany to figure out how we are setting up our entity here in Europe. In addition, I have visited potential areas of operations and met with interesting potential partners for a more global expansion. Further, our developers have completed the first major parts of the application and so far, we keep on track for our development schedule.
4 Responses to “Neighbor Week 3”
Congrats on your progress in development! The sales side does sound very challenging, especially with just a few large entities. How do you go about approaching a university to get them interested in Neighbor?
Well, the problem is the chicken & egg problem. The universities say we need to be certified by the meal plan provider. The meal plan provider says you need to be operating at a couple of schools.
We are going through their dining services and their contracted dining services provider.
Maybe you could look into a large business / corporation that has a ‘campus’ or complex-type environment with dining options? Or just nearby delivery restaurants? You would miss the meal plan piece on that, but busy employees could use the service by credit card to have their meal delivered if they are unable to get away from their office – or if they were stuck in a meeting, maybe several people would want delivery.
Yes, we are working with different large office buildings in Europe. The problem is, I am not sure how well the will adopt a new concept like this. But lets see …