Out of Mexico and taking aim at New York City, the Toplist team is preparing for launch with a new social shopping application that allows users to get instantaneous shopping recommendations from friends.
Toplist is based on a simple concept: follow those you trust, find products you love. Now available in private beta, it helps shoppers to make purchasing decisions based on the preferences and opinions of their friends. The app offers an interface where users see the products their friends like and enjoy and get instant recommendations from people they know.
“We believe Toplist will take hold because we see that people really ask for recommendations from their friends when it comes to buying products,” said Andrés Terán, CCO of Toplist. “We consider Toplist to be a disruptive social shopping service because we actually offer the social experience users need when shopping on a mobile device. We took something that happens in real life and put it on a mobile platform.”
Terán founded Toplist alongside José Arrieta (COO) and Pablo Rivera (CEO) – all from Mexico. The three plan to conduct a soft launch for iOS in December and fully release the product in early 2014.
As to the startup’s business model, initially, the team anticipates revenues from affiliate programs, which will allow it to expand the burn rate of its investment and gain more value from its first funding round (brought in from angel investors). The real business, however, is big data. Terán explained:
Our main objective is to build a large active user base that will provide us with a lot of data that is valuable to different brands and companies. With our system, we will know how users react towards a whole brand or a specific product, but most importantly, towards the brand’s competition. We believe that with enough users and analytics, we can build a really valuable business model through the use of big data.
Emily Stewart: There are a number of shopping social recommendation products on the market right now, but none have really taken hold. What makes you think Toplist will?
Andrés Terán: We know there are some social shopping products out there (Fancy, Wanelo, Svpply, etc), but we do not consider them to be a recommendation destination like we are. Our competition has based their success on showing entertaining products curated by people in the network, and allowing users to have an interaction through those products. We go beyond that. Toplist’s proposal is to reduce the process of getting recommendations from close friends to a matter of seconds. We based the concept on saying that you should only trust the people you know when it comes to receiving a recommendation about a product. Why should you trust reviews on e-commerce websites when they come from people you have never heard of?
ES: You’re going to New York to launch this. Why there? Why not stay in Mexico?
AT: We believe that this concept fits exactly on the way that the NYC market behaves. Everything that involves the project, from the products we show to the app itself, has been proven to be more appealing to the New York user rather than the Mexican or Latin American user. We are aware of the challenges this decision will mean for us, but it makes more sense to launch a product in a market in which studies and trends indicate that users will be more inclined to use the service. We were on NYC during the summer, and that was when we definitely decided that it was the ideal city to launch. We know it represents a bigger challenge, but we are ready for it.
ES: What challenges do you face as entrepreneurs from abroad launching in the United States?
AT: The main challenge has been the cultural differences; we know that every market is unique, and we are aiming at one of the toughest ones. But we have done our job on that end. While we were in New York City, we got to know our users deeply, through psychographics and demographic aspects.
On the other hand, we also consider that moving to a new city always represents challenges in many ways, we will be introducing ourselves into the entrepreneurial environment of NYC and we still need to do a great amount of networking and public relations.
Another challenge we see is that we found ourselves in an era where users are saturated with apps, and they tend to dedicate a very limited amount of time to each one of them. Many efforts have been dedicated into building an intuitive app that has a great user experience and is easy to understand – this reduces the process of getting to know the app to a couple of seconds.
ES: Are you going it alone, with an accelerator, etc.?
AT: We are going alone. At the moment, our funding comes from different angel investors. This has allowed us to have control over the company and launch abroad without any corporate restrictions. We do know that accelerators give startups like us a lot of value and expertise, and we are obviously open if an opportunity comes up. But so far, we have found going alone as a great option for the team and the project.
ES: Once launched in English, will you be looking at the Latin American market?
AT: Definitely. Right now, we are building the company one step at a time. We know that a common mistake entrepreneurs make is trying to build a service that has many functionalities, markets, etc. Once we engage with a specific target of users, we’ll start working on acquiring new people in different markets. But we see the Latin American as the first one after we are well positioned in the United States. We know this is a very attractive emerging market for tech companies around the world. We believe we can reach this region once we have established the company and the product is ready to expand.