Week 12: Evaluating venture pitches
For Naomi’s venture at growCOMM
Comment by jiorns 1:08 pm on November 27, 2013
Hi Naomi,
I am hugely interested in your growCOMM venture as a former ESL teacher and business communication trainer. Also, my Assignment 1 was an articulation of the venture opportunity with Canadian online language learning provider, “Language Research Development Group” (LRDG). See lrdgonline.ca
Your research is outstanding and you have identified an authentic pain point – communication skills of immigrants in the Canadian workforce. Indeed, this seems to be not unlike the LLN problem in most Western countries today.
The solution you propose is sound – cloud based apps for self-paced learning. This is consistent with Ambient Insight’s Research identifying a growth of delivery of learning on mobile devices.
I noted your case for a differentiated product but critique a blanket statement that “reproduction” as a learning approach used by competitors is a weakness because “drills” are a valid part of the pedagogy of language teaching and learning (and business communication training for non-native English speakers is essentially language teaching and learning). For example, pronunciation is a critical language skill and it requires reproduction (mimicry) and repetition (drills). Also, language has both passive and production aspects to it, so language learning requires both. I mean that listening and reading are passive skills, while speaking and writing are production skills. A well-rounded language learning app would cover all these skills. So, I think differentiation is perhaps something to consider more deeply with your venture.
I totally agree that the competitors who are global online language learning providers will have difficulty providing a local context for the content, and therefore your venture has opportunity to differentiate its product from theirs in that respect. But there are other providers based in Canada such as Language Research Development Group who have local context down pat; both English and French. Indeed, LRDG won’t be the only digital language learning provider in Canada going by the approved suppliers to the Federal Government (I tracked this data for my Assignment 1). So, differentiation may need a bit more work.
The business goal of having 10% of the Canadian immigrant workforce enrolled in the next 3 years is an effective and measurable goal that will engage investors. I think this is a really powerful statement and helps to make a selling point.
In terms of your marketing, there appears to be two types of purchaser. Your pitch stated a price point of $300 pa per individual, yet your pitch also says that primary targets of the product (app) are commercial organisations (SMEs) and not for profit organisations who work with immigrants. Would they not be organisational buyers with a different price point?
In regards to potential buyers, you supported the case for SMEs as a likely target market, so your market research was good in that respect. However, you may be interested to read some other Ambient Research data that I located for my Assignment 1, which is summarized below:
Ambient Insight’s market analysis of English language learning in the North America region found that federal and provincial governments are the primary buyers of digital English language learning products and services (Adkins, 2012b, p. 4). Canadian federal and provincial governments are reported to spend CDN $2.4 billion per annum on bilingual language services (Carlson, 2012). Ontario’s expenditure is highest at $623 million per annum, primarily spent on French language education. Third highest is Quebec at $51 million per annum, primarily spent on English language education (Carlson, 2012).
You can see that governments are actually big purchasers of digital English language learning products, and this is likely due to the policies occurring at that level about national workforce skills which leads to budgets passed down to departments for action. However, a number of players are already in that market, so going the path of the SMEs may be the better way.
The statistics you attached to growth of immigration makes a case for a potentially sustainable venture and well yes, go global when you’re ready!
The other point is the ROI in your pitch – it was a few seconds at the end which might not be adequately persuasive. Also, a sentence saying whether you seek one investor to give $200,000 or multiple investors at smaller entry points might be helpful.
Overall Naomi, your concept was really well researched and there is no argument that a market exists for digital language learning (Ambient Insight make that very clear) and that your app likely will be a success.
Ratings
CEO and team 4
Venture concept 4
Marketability 2
Venture Plan 3
Comment by naomi 6:39 am on November 29, 2013
jiorns, you referred to the government as being the primary buyers of English language services – While they spend this much on products and services – they don’t do the actual providing – Having worked in this industry for nearly 10 years, the government provides funding to non-profits to provide the actual services for immigrants, so you actually need to target the providers of the services. What the goverment buys is normally for its own people – which could be a potential market. Now getting the government to invest or see our product as a potential alternative to language training programs could be an option, but it is a fine line as you don’t want to take away from services already being provided and make an industry- which already guards every dollar it can get – view you as competition. Need a politics expert there.
Just to clear up the $300 issue, I didn’t make it clear in my video, but a monthly package for 3 units and 1 class would start at $30, so assuming 10 months subscription and there was my calculation. I like your suggestions of breaking up the option for multiple investors, but I guess I viewed the assignment as a similar to a pitch that you would make to Dragon’s Den.
Regarding language reproduction – yes drill has its place, but these programs don’t even do drill really! I tried several of them out, and the give you a sentence. You repeat it and it marks you for your ability to repeat the phrase. drill would involve repetition, but there was no repetition – hence the term reproduction was the closes I could come to without going into teacher speak. Incidentally these programs aren’t very good at picking up voices, as even when I used my teacher voice, I only got 50 percent and it told me I needed more practice. My students even got less than that, and some of them have good pronunciation!