After listening to Paul Davidescu talk about his mobile app in class, I have become intrigued by technological entrepreneurship and in particular, how success is contingent on perseverance. After Tangoo’s initial operational failures, the company became successful through altering their business strategy. At the first sign of financial troubles, it is far too common for entrepreneurs to give up. Although we can give credit to Davidescu and his team for a successful recovery and launch, moving forward and monetizing new ideas will be very hard. For example, even as Tangoo usage increases, restaurants are unlikely to pay for a better profile or for advertisement on the app when there already exists many other direct methods of influencing customers. Subsequently, revenue streams are limited for most apps and that is why I would recommend making a premium app: adding wait times or aesthetically enhancing the app for example are some ways of making an upgrade desirable.
Tangoo’s November 26th featuring on Dragon’s Den will give Tangoo an opportunity to leverage itself with brand awareness, connections, and many other intangible benefits that come from publicity. In addition, the investors, namely the “Dragons,” and Tangoo can mutually benefit from sharing equity in the company. The purchase of a stake in the company not only fuels Tangoo’s growth with immediate positive cash flow, it also gives the business a proper valuation, which is something that is always vague for small and upcoming enterprises. As the company begins to expand nationally, publicity and built up sweat-equity may be the catalyst of long run success. A report from Statistics Canada says that over 60% of small enterprises rely on local markets. Tangoo’s keenness to defy this statistic through expansion is great, but it will become harder and harder to infiltrate the smaller cities in Canada.