04 Sep On-Demand Startups: How To Conquer One City At A Time
Strategies for expanding your service regions.
Guest author Pablo Orlando is a serial entrepreneur and the co-founder and COO of Gone, an on-demand selling service that helps users rid unwanted items.
New on-demand services are springing up everywhere and changing business in nearly every possible way. But as legion as they might seem to be, getting them off the ground is no easy task.
Managing operations for a growing on-demand startup and launching services in new regions are extremely challenging feats. More often than not, the complexities can make for a total nightmare without proper planning.
There’s no easy route to becoming successful. But for entrepreneurs who are on a mission to become the next “Uber for X [insert some unrelated industry],” the following advice is for you. Here’s how you can expand your on-demand service, one city at a time.
Go With What You Know
As a new on-demand service, consider the specific opportunities that each new city provides for your business. This could also be partnerships you have already established in a city, or how fast you think you can establish a presence before competitors can catch up.
For MeUndies, a premium underwear and basics startup, partnering with Postmates allowed them to offer on-demand delivery of shorts, briefs, T-shirts and more in Los Angeles within an hour or less. Postmates’ newly released API allowed third-party companies to offer local delivery via its on-demand service. For MeUndies, the partnership was a perfect opportunity to test a new distribution model in a popular city.
Another crucial matter: choosing the right region for your services’ expansion. In the selection process, you need to consider factors beyond market size.
When we launched Gone, our on-demand app to help people sell unwanted items in their homes, such as electronics or furniture, we first launched in just two cities: Austin and San Francisco. These were markets we were familiar with, thanks to our time at TechStars Austin and Bay Area team members.
Launching in just two cities allowed us to analyze safety and prove our concept on our home turf prior to broader expansion. Admirable companies pursuing similar strategies are Instacart (on-demand groceries) and Wag (on-demand dog walking), both of which solidified their home markets before expanding to nearby markets.