GroopDoo | Overview

Who does not know the problems related to planning a New Year's party, organizing a club trip, or booking an indoor soccer court with friends? Collecting the necessary money is often difficult and time-consuming for organizers. Moreover, some friends tend to be unreliable or forget to pay their share in time. Consequently, organizers often bear the cost in addition to the effort necessary for organization. Rather than pre-pay the entire amount themselves, activity organizers can now use GroopDoo to ensure financing of the entire activity in a fast and easy fashion and may check at any time how much money their friends have already pledged.

After our own survey of 300 people in spring 2015, 9 out of 10 people give up because of the risk of planning and do not even start organizing activities for groups of five or more people unless the activity is an important event (e.g., their own wedding).

That was the reason why GroopDoo founder Paul Gumienny decided to tackle the problem. As the project developed, so did the ideas and tasks. At just the right time, Sergius Janik, a long-time friend of Paul's since childhood, joined Paul in Berlin and increasingly took on new tasks before eventually becoming the project's COO in June 2016.

Through our platform, we are providing a solution that eliminates all payment-related problems beforehand while also offering a planning tool for organizers that is easy to use even for beginners.

As we have agreed on a partnership with established payment service provider PayPal for our payment system, we are offering a reliable and secure method of payment.

Our novel model is designed in a way that activities take place only if a sufficient number of participants and the necessary amount of money have been reached. When creating new activities, organizers enter the project details, for instance a minimum number of 10 people and a required total amount of EUR 1,000 for the group activity.

From these data, our platform calculates the price per person, that is, EUR 100 (plus PayPal fees) in the case mentioned above. Through a link that organizers receive once their activity has been created, they can invite additional friends and acquaintances via Facebook, email, WhatsApp, etc. By clicking on the link, everyone interested can directly access the activity page and look at the details.

Once enough people have signed up, the organizer can collect the money and use it for the activity.

Our survey has shown that students and clubs in particular frequently need to plan group activities. Indeed, students like to plan group activities on weekends and during their semester break, and our surveys from early 2015 indicated these people plan group activities six times a year on average. Students, however, usually lack the financial means to pre-pay the amount for all participants.

In addition, clubs often organize trips or other events for their members. Rather than hold frequent meetings, participate in lengthy discussions, and collect money in a difficult way, clubs may use GroopDoo to manage the entire process on a single platform. Time and place no longer matter with GroopDoo either because our platform can be used anytime and anywhere through a desktop computer, tablet, or smartphone.

By creating sophisticated processes, we have developed a novel group-payment model similar to crowdfunding and have ensured that it meets all legal requirements. Nobody else has faced the challenges and risks linked to this approach before, so we are one step ahead of our competitors. A 40 % proportion of our target group extensively uses social media – a fact that we use to directly address this group and to advertise our product to it.

Our vision is to help people plan their leisure time creatively and make that time a memorable experience with friends and acquaintances and – at some point in the future – strangers. While people do so, their creativity has no boundaries. GroopDoo makes planning and managing all kinds of group activities easier.

As the number of GroopDoo users increase, we also plan to enable organizers of large events to access new target groups and to use unused capacity, for instance on cruise ships, more efficiently.

We plan to turn GroopDoo into a platform where different kinds of people meet to plan and perform activities without having to spend much time on organization. With the help of a marketing strategy tailored to our target group, we plan to roll out GroopDoo in Germany at first.

As GroopDoo's technology becomes more refined, we want to turn it into an established marketplace for financing group activities.

On the GroopDoo platform, organizers can create the desired activity and specify the following details in addition to the time and place of the activity:

• The date by which they need the money
• The minimum number of people required for the activity (e.g., 10) and the maximum number of
  people (e.g., 14)
• A price per person (e.g., EUR 10 for a movie ticket) or a fixed total amount (e.g., EUR 1,000)

In the first example, the ticket price would remain the same for all people after the tenth person has signed up. In the second example, the price per person would reduce with each additional person until the maximum of 14 has been reached.

Once organizers have entered the necessary details on the platform, they can publish the activity and receive an individual link. They can then use this link to invite their friends and acquaintances through social networks, email, or WhatsApp.

If enough people sign up until the specified date, the organizer sees a button in his or her account that enables collection of all authorized payments with a single click. Afterward, the organizer can start organizing the actual activity because there are enough participants and the total amount has already been pre-financed.

There will be two stages of development in the GroopDoo business model:

Stage I: user acquisition (from October 2016)

As we are developing a platform based on marketplace models, our task is to stimulate the demand and supply sides simultaneously. We are realizing this plan by focusing on organizers (i.e., on the supply side) during the first stage. These organizers are supposed to bring participants (i.e., the demand side) to the platform and to motivate these participants to become organizers themselves. During the first stage, GroopDoo is free for organizers and participants.

Starting in the summer of 2017, we will start segueing into the second development stage of our platform. We then plan to reach at least 35,000 users.

Stage II: revenue generation through commission model (from Q3 2017)

From stage II (scheduled for the 3^rd quarter of 2017) onward, we will enable organizers to invite not just their own friends and acquaintances through channels like Facebook or email, but also other people from GroopDoo's client base. Consequently, GroopDoo will get another feature enabling organizers to invite also strangers who share the same interests or are interested in a specific activity.

According to our 2015 survey, organizers are willing to pay a commission for this added value. In fact, according to the data we have collected, commercial event organizers are willing to pay a commission of even more than 15 % for similar models.

There is not a single model available on the market that both supports organizers of group activities and enables simple pre-financing at the same time. Moreover, the success of GroopDoo projects (activities) depends not only on the total financing amount, but also on the number of people interested.

In GroopDoo's market environment, there are other companies and start-ups connecting users but neglecting payment options, such as meetup.com; therefore, it is possible to offer non-sponsored events on such platforms only in connection with financial expenses. Moreover, there are crowdfunding platforms like kickstarter.com, the TILT app, and leetchi.com where multiple people can raise funds for projects together. Such projects, however, are not like the activities offered on our platform and do not depend on the number of participants. In addition, we collaborated with a major law firm while developing our platform in order to ensure solid legal foundations for our complex payment system. At the end of the process, we received a positive report from the law firm. Finally, GroopDoo has registered its design with the German Patent and Trade Mark Office.

Even before our market launch, TV stations have noticed GroopDoo. Indeed, German TV station VOX featured GroopDoo in a documentary broadcast at prime time on a Saturday night and spent a typical day with founder Paul Gumienny.

Payment System Partner

We acquired PayPal, a company that is established in Germany and that many people trust, as a partner for our payment system in September 2015.

Indeed, PayPal has provided us with an interface to its payment system that is tailored to our business model and covers several authorization levels. This API (application programming interface) enables us, among other things, to represent the payment relationship between organizers and participants so that GroopDoo acts as a technical intermediary rather than handle monetary transactions itself. Another special feature is that we can store payments, which are then made at a clearly defined time in the future rather than at the time of the request.

Clients

GroopDoo attracts clients indirectly by addressing people who organize trips, events, or other activities with their friends on a regular basis. Such event organizers then create group activities on GroopDoo and invite people to participate in their activities. In this way, we are continuously building up a community on GroopDoo.

Consequently, our marketing model leads to a low cost per acquisition (CPA), for the cost of acquiring a paying client results from the cost of acquiring an organizer divided by the number of participants in this organizer's activity. If, for instance, it costs us EUR 55 to acquire one (1) organizer and this organizer attracts 10 people to his activity, a platform user costs us EUR 55 / (1+10) = EUR 5.

Through our own surveys, we have found out that activity participants would use our platform up to six times a year. That is a value indicating a positive customer lifetime value (CLV – the combined value of all purchases from a company made by the same client).

Initially, we will acquire clients primarily through Facebook. This is due to the fact that Facebook is not just ideal for targeting specific characteristics of certain types of people (for details see "Target Group and Market Volume"), but that it can also easily be measured and optimized to better define our target audience. Finally, we also want to motivate users acquired through email marketing to repeatedly create activities on our platform.

Students and members of clubs are our primary target group. In fact, we have found out that demand for our product is the highest within these two groups. We address students through direct online targeting (targeting of users online based on their characteristics, e.g., "student who likes traveling and crowdfunding") on social-media channels, whereas we address club members through both indirect online targeting. In this context, "indirect" means that we do not address potential "club members" directly through targeting but identify them with the help of a club member's characteristics. More specifically, we address these characteristics indirectly: If, for instance, a person likes "bowling" and has many friends who like to go bowling as well, we believe this indicates that the person is probably a member of a bowling club.

Our two most important target groups are:

Students aged between 18 and 25 who are well-educated, spend their leisure time actively, and have a large social network. These people participate in various activities with their friends all over Europe, no matter whether these activities are trips to nature or cultural events, for instance in the context of exchange programs. They like to discover and try out various new things, are part of the group of so-called "early adopters," and share their product experience with fellow students. In most cases, these people's income is limited, and they cannot pre-finance costly activities for large groups of friends (>EUR 250), yet they like to spend their available income on group activities.

People who are members of clubs come from many different age groups (between 18 and 50 years) and from both sexes. As a social institution, a club is a large social network focused on the same interests that is often used for planning activities (e.g., club trips, short trips, Christmas parties, and evening entertainment). For these purposes, club members need an efficient way of collecting large amounts of money from fellow members and of organizing activities in a fast and easy way. Management of cash and bank information takes much time.

Former Bundesliga soccer manager Michael Meier, who is part of the GroopDoo network and advises us in terms of business development, believes GroopDoo will become a tool for simplifying club-internal organization processes in the near future.

There are currently 2.8 million students in Germany and roughly 300,000 in Austria. Over 23 million people are members of German sports clubs, and Austrian sports clubs have roughly 3 million members. In total, our target group in German-speaking countries consists of over 29 million people. We have not yet taken Switzerland into account because we are initially focusing on the euro area.

According to studies and surveys, our primary target groups throughout Europe consist of more than 170 million people who are students or members of clubs.

If each GroopDoo activity participant were willing to spend EUR 30 on an activity per year (as surveys have shown us), GroopDoo's annual transaction volume would total EUR 5.1 billion.

In Europe, far more than 40 % of people regularly use social media on average. Consequently, our potential market consists of 68 million people, that is, to an approximate transaction volume of EUR 2 billion per year.

By the way, 650 million people worldwide and 100 million people per day use the event feature on Facebook. Facebook has dedicated an entire app to this. This app, however, does not take the aspect of financial planning into account either, which is a great opportunity for us. Indeed, Facebook focuses on advertising revenue.

After over one year of development, we have managed to create an online product that is technically and legally complex, yet stable, scalable, reliable, and legally sound at the time of its market launch.

In September 2015, we agreed on a partnership with PayPal for our payment system. We then ran the first live payment tests in December 2015.

In early 2016, we started a partnership with two local designers from Berlin. We also got a new website back then. In late April 2016, Sony Pictures filmed a VOX documentary featuring GroopDoo, which was broadcast in October 2016. At the same time, GroopDoo started a partnership with ehx management GmbH, a successful software development business. Interested in our product, ehx management provided us with developers to take our platform to a high performance level.

After founding our company as a joint-stock company in June 2016, we launched the platform this October (after numerous tests). Our coming milestones will include integrating additional payment options (in March 2017), publishing mobile apps for iOS and Android (in July 2017), launching "public activities" (in July 2017), and addressing commercial providers (in October 2017).

The expansion of our platform will continue by adding new features such as a rating system and a feature for sharing previous activity experiences.
We also consider adding partners for transport, accommodation, and entertainment and a mobile GPS feature for finding activities currently taking place.

We will use the Companists' investments mainly for personnel and marketing. Our focus is on marketing (social media) through Facebook and influencer campaigns. Influencers are popular video bloggers with many followers, for instance on YouTube, with whom we will get in touch through a partner agency and who will raise awareness of GroopDoo within their networks and contribute to fast client acquisition. As the number of successfully organized activities increases, new impressions are generated that users share on their own channels and on our social media channels like Instagram.

Reaching the second stage of our business model is highly important to us because we will then start generating revenue from commissions. In stage II, we enable commercial providers to create group activities.

Investment Level 1: EUR 100,000

• Investments in our primary online marketing channels to increase conversion rates (conversion of website visitors to users) for activity organizers with a special focus on Facebook, email marketing, and YouTube influencer marketing
• Implementation of additional core platform features related to communication, user experience, and client retention

Investment Level 2: EUR 200,000

In addition to investment level 1, we plan to:

• Increase our online marketing budget and significantly optimize the way in which we address our target groups (tailored to the high-conversion target groups within our different channels)
• Implement measures simplifying the use of GroopDoo within the euro area (e.g., an English-language version)
• Invest in client support and retention in order to increase client satisfaction and public awareness of the GroopDoo concept

Investment Level 3: EUR 300,000

In addition to investment levels 1 & 2, we plan to:

• Hire an app developer for iOS/Android that will focus on mobile applications of GroopDoo
• Invest in app marketing (iOS and Android)
• Hire a community support manager
• Increase the number of payment methods with the help of additional payment service providers in order to reach more users on the market

Investment Level 4: EUR 400,000

In addition to investment levels 1 to 3, we plan to:

• Optimize the web-based and mobile product with regard to the features from stage II (i.e., users meeting people with the same interests)
• Expand the social features of GroopDoo
• Introduce a new rating system for activities and their organizers
• Cooperate with insurance companies
• Develop a sales structure for commercial partnerships

Our business angel is Frédéric Naujokat of ehx management. This company has enabled us to launch the GroopDoo platform on the market with its current features, performance, and scalability. ehx management owns a 25 % share in GroopDoo.

Thanks to our large network of experienced founders and specialized advisors, we have refined our business model and have ensured it conforms to the market.
For instance, we have received advice on our business model from Joseph Noronha, who is a counselor on behalf of the famous Californian "500 Startups" accelerator (a program for founders of promising start-ups).

Moreover, GroopDoo is being supported by the Berlin-based online marketing experts of "Chat von gestern Nacht" ("Last night's chat"), who have achieved 1.8 million Facebook likes with their model so far.

As GroopDoo is a B2C platform, we invite all Companists to try out the platform themselves, create activities, and invite their friends and acquaintances to plan and organize common events on GroopDoo. Each organizer brings new participants, who may become organizers themselves.

Moreover, we will be grateful if you raise awareness of GroopDoo on social media, support us by activating your own network, and personally recommend us to others.

Do you have any suggestions, or have you found any errors in our design or features? Feel free to send us your feedback to feedback@groopdoo.com.

GroopDoo UG (haftungsbeschränkt)
Albrechtstr. 11, 10117 Berlin

phone: +49 (0)30 / 28886106
Mail: info@groopdoo.com
Web: https://www.groopdoo.com

Facebook: www.facebook.com/groopdoo
Twitter: http://twitter.com/GroopDoo_de
LinkedIn: https://www.linkedin.com/company/groopdoo
Xing: https://www.xing.com/companies/groopdooberlin