vanilla bean | Updates

By Bastian Schumacher

vanilla bean gets off to a strong start

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Dear Companists,

We would like to thank you very much - for your trust, your support, for the amount of positive feedback, as well as for the critical comments and questions. Especially the criticism shows us where we can and must improve.

There were some comments on our forecasts/financial data. With the new presentation format for campaign profiles on Companisto, all information is now compactly available in the pitch deck. Due to requests we would like to give you some more detailed information about our financial data in this update.

 

Strong campaign launch with media attention

First, however, we would like to tell you what has happened in the past few days. Within the first week after the start of the campaign we were able to reach 17% of the target funding amount. For this we would like to thank you again, dear Companists!

Great news awaited us the day after the campaign launch: We were once again featured by Apple's App Store UK. Anyone working in the app development industry knows what an award for quality work - and a valuable marketing measure - such a feature is. It also resulted in the highest number of downloads (over 4,200) on a single day.

The Apple App Store Germany also became aware of us. We received an invitation to a series of exclusive "invitation-only" App Store events in Berlin. These primarily focus on App Store marketing and offer us a valuable opportunity to further optimize our App Store presence. It is also an excellent opportunity to establish closer contact with the App Store team.

 

Vanilla Bean - App Store UK

 

The press also became aware of our campaign launch. Our co-founder Fabian was interviewed by Vegconomist, the leading business journal in the vegan sector. ECOreporter, the magazine for sustainable investments, reported about us. If you would like to learn more about vanilla bean, our history and our restaurant guide, we can recommend this extensive podcast interview with Fabian from InterNetX. Two more interviews have taken place but have not yet been published - more on this in the next update!

 

Video conference recording from 22.01.2019

Our first video chat on Companisto took place on Tuesday, 22 January. Many thanks to all Companists who participated and asked us questions! If you missed it, you can watch the video conference here.

 

 

Financial Planning

At this point, we would like to go into detail about our financial planning.

 

1. Revenues

On the one hand, we will generate sales via the delivery business and, on the other hand, via the sale of our vanilla bean boxes, which are directly linked to the delivery service.

The platform model gives us the opportunity to integrate additional services such as advertising or table reservations in the future. This is planned for 2021. This gives us dual scalability: on the one hand, we can further expand our services geographically, and on the other, we can integrate additional services and thus further utilize existing markets.

 

1.1. Revenue Development

At the moment, we are setting up the packaging-free delivery service. This includes software development (apps for users, restaurants and drivers), box development and production, restaurant acquisition, and marketing preparations. The first orders are to be delivered in Berlin in the third quarter of 2019.

The number of orders depends largely on the marketing budget we have available and how many new customers we can reach with it. Depending on the amount collected at Companisto, we plan with a monthly marketing budget of up to EUR 10,000. We initially assume a price per acquired customer (CAC) of EUR 15.00, based on our forecast cost for a new user in Berlin (CPI) of EUR 1.50 and a conservative initial conversion rate of 10%. The average in our area is 14% (Consumer and Local Services). We expect to reduce the CAC to EUR 5.50 by 2024 by optimizing the conversion rate and taking measures to acquire new users virally.

Statistics show that customers of a delivery service order about once a month on average. Conservatively estimated, we assume an order frequency of 0.58 orders per month per user, since we take into account that our users do not order exclusively via our app. The average order value (based on Takeaway.com) is EUR 20.05. After an initial starting phase, we plan to place 1,000-5,000 orders per month in Berlin by the end of 2019 - with a rising trend. The further development of sales will largely depend on how quickly we can expand into other cities.

 

vanilla bean - revenue development delivery

 

Our planning is based on conservative order volumes. For comparison, here is the number of orders from three major competitors in 2017:

  • Delivery Hero: 291.5 million
  • Just Eat: 172.4 million
  • Takeaway.com: 68.3 million

 

vanilla bean - revenue development total

 

2. Expenditure

We have used the capital invested to date to develop and market the restaurant guide and to establish the restaurant database. 70 % were personnel costs and just under 10 % marketing costs.

The distribution of costs will be adjusted for the development of the delivery service. The four largest items are: Personnel, marketing and sales, delivery, and production costs for the boxes.

 

vanilla bean - total costs

 

vanilla bean - cost development

 

2.1. Personnel

A large part of the team works in software development. Scalability can best be ensured through further development and optimization of our apps. That's why we want to continuously expand our development team.

Of course, efficient and professional marketing is central to our service in order to make new users aware of our product range. In order to attract new restaurants and serve existing customers, we need field sales staff. Experience and a look at the competition show that the best way to acquire new customers is on site and that all other channels (telephone or online) produce very poor results. The amount of marketing and sales staff scales directly with the expansion of our service into other cities/markets.

 

vanilla bean - human resources

 

2.2. Marketing and Sales

The industry is highly competitive and the major delivery services are investing heavily in marketing to attract new users. At Takeaway.com (64.5%) and Delivery Hero (53.1%), marketing accounted for more than half of total costs in 2017. We also plan to allocate a large part of our total budget to marketing. Excluding delivery costs (to be comparable, as delivery costs are only a fraction of total costs for the above companies), marketing accounts for 40% of our total budget. Potential surpluses will also flow into marketing to a large extent.

 

2.3. Delivery

The big challenge in our industry is the so-called problem of the last mile, i.e. the delivery to the front door. These costs are very high due to the use of couriers. A lot is currently being invested in research into new solutions, and the industry expects prices to fall in the future.

However, human couriers are still needed to deliver the products. The decisive factors for costs are how expensive the individual courier is and how many orders on average he can deliver per hour. We plan with external courier services that take care of delivery logistics for us. Although this solution is somewhat more expensive, we immediately have a complete and functioning solution. We have already found a partner for Berlin in Messenger.

The greatest potential for optimization lies in the number of orders that can be delivered per hour. According to Messenger's experience, we can initially expect two deliveries per hour. By increasing the volume of orders and optimizing routes, we plan to increase this to 3.25 deliveries per hour by 2024 - provided, of course, that there are no cheaper alternatives than courier delivery. By the way, Foodora states that (especially at weddings) more than 3.5 deliveries per driver can be achieved.

                                                             

2.4. Production costs for the boxes

We are already in negotiations with a specific supplier for the production of our boxes. The production price per box is initially EUR 5.00. Due to higher quantities, the price will drop to EUR 2.50 by 2024.

Concerning the development of the boxes we also hope for helpful research results of our cooperation partner, the TU Berlin, in order to optimize sustainability, longevity, and also production costs of the boxes.

The number of boxes we have to provide is determined by the number of orders and the wear and tear of the boxes. Based on the producer's experience, we expect to have to replace all boxes once within three years. By optimizing materials, we plan to extend the service life of the boxes to 5 years by 2024.

 

2.5. Other

The other major items are hosting (23 % of other), consultancy fees (19 %, including legal and tax consultancy), investments in fixed assets (15 %, which in our case primarily includes staff hardware and office equipment) and office rent (10 %). The remainder consists of expenses for administration, equipment for couriers, further staff equipment, insurance, software and licenses, as well as staff recruitment.

 

3. Income Statement and Cashflow Projection

vanilla bean - financial projection

 

Until the next update!

Best regards,

Basti



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