Photo - Groombox
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Groombox

Subscribe to grooming essentials and try new products

UAE
Market: Internet and IT, Artificial Intelligence
Stage of the project: Prototype or product is ready

Date of last change: 01.03.2020
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Idea

The journey w/ Groombox begins with creating your grooming profile, this is where you recreate yourself virtually - pick what category of products you want inside the box - finalize with your personal preferences (EG: if you prefer organic, vegan, cruelty-free products). Subscribe & receive your first curated box filled with 4-5 samples the next day. Users are then incentivized and reminded to rate their experience for all samples tried out. If a consumer likes any sample, he can buy the full-sized variant on our marketplace.

Additionally, users can subscribe to their grooming essentials.

Current Status

Operations - Have procured over AED10k worth of grooming product samples free-of-cost, just based on the vision and also partnered with box manufacturers, warehousing, and logistics/fulfillment companies who will provide us with extremely competitive rates that get better over time.

Product - Have researched and developed designs, revenue streams, features, and UX frameworks for maximum retention and customer satisfaction while maintaining positive financial forecasts.

Technology - Have developed extensive wireframes for the website along with a barebone MVP in React + Laravel. Have split the site into three separate products, TRY - BUY - SUBSCRIBE (explained below).

Marketing - Collected an email list of over 5,000 people who fit the target market in terms of age, gender and income. Have a couple of blog posts lined up for pre-launch when activities start.

Market

The market in the UAE for men's grooming products is AED 1.1 billion according to Euromoniter 2018. This is completely pessimestic if you take into account that roughly 70% of the population are males.

The great thing about men's grooming is about 25% (2 million men) make up about 75% of the market, which makes it very easy to target.

Problem or Opportunity

1) People cannot try new grooming/beauty products without buying and committing to the entire full sized container which may last up to 3-months or more.
2) People know what they are trying to fix, eg: Acne. But can't seem to find solutions since every 2nd facewash promises anti-acne, they waste tons of money buying these full-sized products.
3) There are SO MANY options available, the majority of the people are overwhelmed and stick with generic products like Nivea, since "it does the job", even though it does not make them feel like a million bucks.
4) Low self-confidence/self-esteem, 80% of people suffer from some degree of self-esteem issues.


Why does this problem exist?

1) There is no concept of try-before-you-buy for consumables. If one buys products like these, it's via online marketplaces or a physical store and only full-sized products with no chance of return once opened.
2) Lack of knowledge because many brands are trying to upsell users based on exaggerated claims.
3) Influencers and celebrities portray their filtered lives, along with unachievable images of perfection on social media, this results in envy which has a corrosive effect on people.

Solution (product or service)


TRY - Perhaps the most complicated of the three includes developing a 'Grooming Profile' bit where users can enter information such as what kind of hair do they have, type of skin, shave/maintain a beard, preference for organic products, etc. Based on the Grooming Profile, a TRY box will be curated and personalized fo the user and sent every month (or however frequently the user needs it (flexibility is key).

BUY - An e-commerce store that offers all the imaginable products and caters to every grooming need possible. Links to the TRY model as prompts to rate, and purchase (if rated positively) products delivered via the TRY box.

SUBSCRIBE - Allows the user to put in any number of grooming items and tools and specify how often they would need each item. They get the listed items delivered to them FREE-OF-COST. How we make money is by linking up with brands and offering a targeted sampling scheme where we only distribute their samples to people with potentially high lifetime values.

Competitors

We would be first to market, indirect competitors include Malls & Supermarkets. Threats include Dollar Shave Club, Harry's, Birchbox (Although they are still in the process of capturing market share in the western regions) and local copycats.

Advantages or differentiators

Personalized, flexible, You can subscribe to full-sized products based on your usage pattern, we are an existing marketplace for A-Z experience. A platform for all good-quality brands with no biases (Dollar Shave Club & Harry's only push their own products, we wish to be more than that - an ecosystem for men's lifestyle).

A focus on men's lifestyle for the brand. The idea is to get solid engagement with the brand and build trust for the product of that. Kind of like Apple.

Finance

The box will be priced at an average order value of AED 65.

The COGS initially taking into account low MOQ's and unit of economics starts off at AED 50 for first-time orders (which includes next day delivery last-mile costs). On the other hand, repeat orders start off at AED 43 (batch deliveries save money).

By the end of the first operational year, these COGs go down to AED 38 & AED 33 respectively.

Business model

TRY box - Users pay a subscription fee. Brands pay us for targetting their samples.

BUY - E-commerce based store where profits are made via wholesale rates of an average 40% under retail, so if a product sells for AED 100, we make AED 40. Additionally, rent exclusive branded pages on a quarterly basis (for example, a special branded page for 'The Art of Shaving' (one of our awesome partners), with only their products.

SUBSCRIBE: Users receive this service free of cost, brands supplement the cost of delivery and pay us for mega-targeted sampling (since we know what products the user LOVES, as they are subscribed to them).

SAMPLING: If things work out with the government, we offer a service where we make the samples for brands as an alternate to them paying $6000 to create their molds.

Money will be spent on

Balancing along with revenue generated from startup:

Launch - License + Setup + Bank Bal + initial MOQ

Recurring:
Salaries - CEO + CTO + Brand Partnerships + Marketing
License
Office (co-working space subscription)
24/7 Customer Service (Callix)
Warehousing (TheBoxME)
2D Animated Videos
Legal Budget
Writers/Designers/Freelancer
Marketing Retainer
Marketing Budget (% of revenue): 20% -> Average 2020: $3200/month; Average 2021: $7000/month; Average 2022: $13k/month.
Website Maintainance (Hosting + App Engine + Jira + GitHib + Cloud SQL + GSuite + Canva)

COGS first box (1000 MOQ): 2020 avg - AED 44; 2021 avg - AED 32; 2022 avg - AED 24.
COGS repeat box (batch delivery, cuts down on logistics): 2020 - AED 35; 2021 - AED 28; 2022 - AED 21.

Offer for investor

We're offering a Pre-money safe for $280k, at valuation cap of $2m.

Team or Management

Risks

Not all brands have samples: It costs a brand roughly $6000 to make a mold for a sample container. We estimate that until we get to a point where we're worth the investment, it will be a challenge to procure a lot of new brands and products on a monthly basis. We are trying to turn this potential obstacle into a massive revenue stream by getting approvals from the government to allow us to repackage existing products into sample-sized containers, allowing us to be the first in the world to do so.

Incubation/Acceleration programs accomplishment

Currently Attending, Y Combinator Startup School (Cohort: YC SUS Winter 2020); YMP Graduate, Young Arab Leaders; Community Program, Sheraa.

Won the competition and other awards

1st Place, Techstars Startup Weekend 2019 - UAQ; 1st Place, Future Tech Summit 2019 - Dubai; Semi-Finalist - UAE Qualifier, Pitch by the Pyramids (RiseUp).

Photos

Photo 1 - Subscribe to grooming essentials and try new products
Photo 2 - Subscribe to grooming essentials and try new products
Photo 3 - Subscribe to grooming essentials and try new products
Photo 4 - Subscribe to grooming essentials and try new products
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Idea
Current Status
Market
Problem or Opportunity
Solution (product or service)
Competitors
Advantages or differentiators
Finance
Invested in previous rounds, $
Business model
Money will be spent on
Offer for investor
Team or Management
Mentors & Advisors
Lead investor
Risks
Incubation/Acceleration programs accomplishment
Won the competition and other awards
Invention/Patent
Photos
Product Video