One of the biggest barriers to doing business online for SMEs can be setting up an ecommerce platform, which can be confusing and expensive. In addition, marketing the products and sorting out the logistics of supply and delivery can be a headache.
Startup Netberg is aiming to simplify the process, by enabling users to create simple web pages where they can sell products, as well as taking care of billing and distribution.
I caught up with founder Michele Cuccovillo to discuss the business in more detail.
Q) Can you tell us how Netberg got started, where did the idea come from?
A) Like many innovative ideas, ours came from a co-founder’s personal experience of a market need. Our co-founder, Jubin Nouri, had always helped his parents, who own a pharmacy, with their business website. He wondered why there was no way for a small business to have a website that was free and easy to use, where it was also possible to sell products. He talked to his best friend, Lorenzo Rando and myself about the idea and we both agreed with Jubin that this was something that did not exist yet.
We realised that many small and medium businesses are not online, because either they do not know how to be online, or they do not see the importance of being online. Small and medium businesses have to work very hard to compete with big corporations, especially online, as they do not have the capacity to spend a lot on a website’s design or SEO. Netberg is an online community that allows these small and medium businesses to stand together, whereas the power is in the numbers.
Q) Can you explain your business model in very simple terms?
A) On Netberg, businesses can create their free business web page in only five minutes, so that the world’s customers can see what they do, what they sell, where they are, when they are open and buy their products or services online. Last but not the least; Netberg also manages payments and door-to-door pick-ups and deliveries. This way, we take all the hassle away from selling online. In return, Netberg earns 7% commission on sales generated on the platform.
Q) What does your team look like?
A) Our team currently consist of eleven people. We have three directors and co-founders, five young and eager interns and one sales leader base in London, and one director of sales and one director of partnerships based in Italy.
Our team members are all creators and world changers and firmly believe nothing is impossible. We work as a flat organisation, and we value our team satisfaction as much as our customers and shareholders. At Netberg, we encourage a fun and collaborative work culture within our office space and we live and breathe a can-do attitude.
Q) How have you funded the business?
A) So far, Netberg was founded entirely with our directors’ own savings. That was actually a great experience, because it helped us all realise that it is possible to achieve great results creatively without spending any or little money.
Netberg is currently part of the Accelerator Academy, a high growth training and mentoring programme in London. We hope that we learn enough during the process to attract investors who share our vision and understand the potential of Netberg.
Q) How did you get from idea to product, was there much project management involved?
A) After Jubin had the initial Netberg idea in February 2013, he shared it with Lorenzo and myself. Not long after that, we started working on the business plan. At the same time, Jubin started working on the thousands lines of code that make up our website, together with our web designer. In February 2014, the first few interns joined the team, selected from top universities across Europe. The beta-version launched shortly after the interns started, and they did a lot of work testing the product with our clients. On 14th May, we launched our final product, with a brand new homepage, during our launch event at Google Campus London.
Q) How much competition is there in your space? How do you stand out?
A) Many other companies offer online presence for businesses. However, we are different; we created a new concept that stands between three categories of competitors.
The first group consists of website generators. These companies provide businesses with a stand-alone website for a monthly fee. These websites generally do not attract many visitors without investments in marketing or SEO. They also offer too much customisation, which is nice but often complicated and very time consuming.
The second group of competitors are the online business directories. These directories cannot be used to sell online, they often have outdated information on them, and the business owner has little control over his business page.
The last group are the e-commerce platforms. These platforms only focus on the products, not on the business identity. They also do not promote off-line presence, and they have a complex pricing system.
Netberg is different compared to these competitors in various ways: a business owner can create a page for his website in under 5 minutes, without needing IT-skills. On Netberg, the business pages are part of a searchable network. They have a built-in e-store where they can present and sell their products hassle-free. The pricing is also clear, as we work with a revenue-sharing scheme. The business owner can create his webpage for free, and when he sells online, Netberg earns 7% commission.
Q) What does your typical customer look like?
A) We believe that all businesses should have a website, even just a simple one. Our websites are suitable for any SME, while our e-commerce is specifically tailored to businesses that sell physical non-perishable products that are easy to ship.
That means we approach all kinds of businesses: from shoe shops to butchers. We focus on these local SMEs because they generally do not have the time, money or skills to set up a website for their own business. We also make these businesses part of a community, so they can stand together with other SMEs, and survive despite the power of the big corporations.
Q) What have been your major hurdles when starting up, how have you overcome them?
A)When we started working with the team and launched the beta version, we had two main problems on our path. The first one was budget. We did not have a big amount of money to spend for marketing campaigns and advertising. That is one of the reasons why we joined the Accelerator Academy: to learn and prepare ourselves for investments.
The second one was time, as we have many ideas for activities that would make the company grow but unfortunately only limited number of hours within a day.
Q) Are there any services or tools that you can recommend for startups who need help with getting stuff done?
A) For a small company, the Google apps are great. We use Gmail, which is integrated with Google Drive, Calendar, Google Hangouts, etc. We use Buffer to schedule our Tweets and other social media activities. It is an easy-to-use tool, which lets you schedule your social media activities and see them all in one clear overview. Mailchimp is great for small scale email marketing. We used it to design and send the invitations to our launch event. For designing our marketing material, we mostly use the programs by Adobe, such as Photoshop and Illustrator.
Q) What customer recruitment channels are you using, and which are the most effective in terms of conversion?
A) We have been trying many different approaches to reach business owners. We started preparing the sales strategy in early February, and immediately identified two main channels: direct (email marketing, telemarketing sales and face-to-face visits) and indirect (business associations, public bodies, etc.). Recently we signed a contract with the biggest business association in Italy, Confcommercio (over 700,000 businesses associated), which should help us scale very quickly from autumn onwards.
Q) What are your long-term plans for the business?
A) Netberg has many plans for the future. After achieving the first target in UK and Italy of bringing many businesses online, Netberg plan to land to the US. The US is one of the biggest e-commerce markets and it would be a great opportunity worth exploring. Besides the US, plan is also to expand within the EU tackling major countries like Germany, Spain and France. Our vision is exactly what our tagline says: to bring all businesses online.