In launch, startups face hurdles attracting student users

Startups have many ups and downs before making it.

Jeff Hargarten

 

Nabbing the attention of college students is a challenge facing new startup companies each year.

In recent months, new startups targeting University of Minnesota students and college-goers in general have cropped up across cyberspace. But without an established brand name, there are a number of hurdles each has to navigate.

“College students are evasive creatures,” said Preston Davis, a vice president for Qwicklr, a new event-organizing website. “With everything they keep up with on a day-to-day [basis] … they don’t have much extra time to utilize new services.”

Product testing, audience research, drawing initial customers and keeping their attention are all initial challenges startups have to tackle in the beginning, said Connie Rutledge, associate director of the Carlson School of Management’s Ventures Enterprise, a program that helps MBA and undergraduate students hone their entrepreneurial skills.

She said broad strategies to attract customers, including college students, weren’t as useful as understanding what each specific business has to offer.

“If you have a good sense of who your customers are,” startups can have better success at drawing people in, she said.

Students to draw students

Drawing initial users to get more consumers is the first challenge web startups have to tackle.

Mohamed Elabbady is a University graduate who helped launch Gradloop in January to help students more easily find jobs and internships.

Elabbady said he and his team had all understood the frustrations of finding internships while in school. Gradloop sets itself apart from other career-hunting services by catering specifically to college students.

The website needed qualified students to entice companies to search its database for potential interns and employees. However, students looking for jobs tend to upload their résumés where employers are already searching.

Startups have to do “a lot of networking, develop incentives, knock on doors and make phone calls” to attract their first customers, Rutledge said.

Gradloop spread the word at local career fairs and college campuses, Elabbady said. He also asked the Beta Chi Theta fraternity to “help a brother out” by signing up for Gradloop since the company’s founders are members.

The website had about 150 students sign up in its first two weeks, Elabbady said. About a dozen more companies have also signed on to use Gradloop’s services.

Testing the concept’s worth

Investment in a new idea is hard to come by in today’s climate, said Dan Linstroth, co-founder of Heroic, a new web startup. The company was launched in fall 2011 and provides University students a way to find odd jobs for money around campus.

 “You have to understand the customer’s problem from their point of view,” Rutledge said.

Among Heroic’s first tasks was finding out whether a website offering payment for simple tasks was something students wanted. Before its official launch, Linstroth and his team built a pilot website, HelloHeroic.com, where the first users could sign up and refer friends.

Entrepreneurs need to be “scrappy” and able to construct a viable product with little to no money in order to test it, he said. It’s the initial feedback from that test, he said, which verifies whether the product and business venture is worth it.

 “Only then will you know if and when your business even has the possibility to succeed,” he said.

Selling free services

Another challenge facing startups is convincing students a new service is free and worth their time.

Launched in November 2011, Qwicklr is an online bulletin board where students can organize and promote events while still managing their busy schedules.

But at first, most students assumed the website charged, Davis said. So Qwicklr had to convince students its services are “free and always will be.”

Qwicklr is promoted as an alternative to other free services like Facebook and MySpace, with a key difference being that events can be seen by more than just friends and family, he said.

“A lot of times there is something attached” to seemingly free websites, Rutledge said, so people are often skeptical. She said it’s important to be transparent with how the startup works and treat those first users like partners in the business.

Making the first match

 In its first weeks, Gradloop strived to make its first match between a student searching for a job and an employer. Since its launch, the website has had some employment matches, Elbaddy said, but that expanding its number of users was important to generate more.

Once the initial user base is established, the startup has to deliver on its promised service, Rutledge said.

“The customers have to feel like [the startup] is doing something for them,” she said.

For instance, while Qwicklr allows students in all 50 states to log in with their school email and post a social event, there currently are no events listed for the University and other Minnesota colleges, though there are many between Virginia and Pennsylvania.

Since its launch, Heroic has gained three additional investors, two more co-founders and thousands more users to its new website, Linstroth said.

Even in a competitive market and struggling economy, there’s always room for entrepreneurs, Rutledge said, but it’s a matter of knowing the audience.