Group Buying Econ 101

2010-10-18_22

We just finished up a Startup Monday meetup and are discussing what will happen to the group buying companies in the coming months.

Here is my take:
1. The cost the consumer expects will trend towards some equilibrium point that doesn't allow margin for the buying site. This is where the red and green lines cross and the blue line is shown.
2. The price that the retailer is willing to offer will trend up, leading to reduced margin for sites.
3. As shown in the chart, any deals above the blue break even line will have margin, anything below will have negative margin.

So, what does this mean? As the two market forces trend, this will push the price toward the no margin or negative margin and will force companies out of the market. It will be an opportunity to innovate or die.

Startup Mondays – Every Monday at BootHK

5-boothk_2

StartupsHK started out as Startup Mondays, an informal meetup of people in startups or starting their own. That lead to Startup Saturday less than 9 months later. Now that BootHK is open and we are not busy planning out the next conference, it is time to get back to the basics and start a new tradition for Hong Kong startups.

What: Startup Mondays – Come out and meet with other startups in Hong Kong, share what you are doing, get help with problems you are running into, and get feedback from peers and mentors. 

Who: Anyone that is currently running a startup company or is in the planning stage of starting one (please, no financial planners or startup groupies, just active startup entrepreneurs).

When: Every Monday, 7:30 onwards, bring dinner if you want, and you are welcome to stay and work on your startup after the meetup. 

The idea is that this is going to be a small and focused meetup, so don’t feel that you must attend each week. Also, if you have another time, such as during the day that is better, we can try doing different times if there is enough demand. 

If there are around 10 attendees, we will just have one big group, if more people show up, we will break it up into two or three groups to keep the quality high and duration short. That way everyone can have plenty of time to discuss what is important, but it won’t take more than an hour or hour and a half. 

After the meetup, stay and work on your startup, especially for those that are working during the day to bootstrap.

BootHK Location

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