Say you find yourself with a free afternoon in Paris, strolling the boulevards, wondering what to do. Life can be hard that way.
Maybe you’re in a culinary mood, peering into bistro windows (with Parisians muttering back, C’est quoi ton problème?), wishing someone would instead whisper suggestions in your ear.
Or you’re a completist, intent on a walkabout of the must-see attractions, or the alternatif type who prefers the unconventional. Well, there’s (inevitably) an app for all this.
Soul.City Group Inc. is a part-Montreal, part Strasbourg-based startup trying not only to break into the travel app market, but also negotiate the ins and outs of running a business both from Canada and France.
Its app lets users pick the duration of the walkabout (say, two, four or six hours) and what kind of mood they’re in (“foodie,” “girly,” “making the kids happy,” “jet lagged,” “romantic,” etc.). The app is free, with its itineraries and content drawn from bloggers. Sales will come from other companies sponsoring the content.
Soul.City launched in February with walking tours of Montreal. Strasbourg (where one of the company’s three co-founders, Michael Bechler, is based) was added in March, and Paris in May. The company hopes to feature 10 cities by the end of the year, and by 2020, 100 cities.
The learning curve is not just about building the content and sales, but doing so for an international audience and international sponsors.
The technology side is in yet another location, Quebec’s Gaspé region, to take advantage of tax incentives. So, “the programming is done in Gaspésie, the marketing comes out of Strasbourg, and the headquarters are in Montreal,” says chief executive Annick Charbonneau, who previously headed an online fashion business, Chiccane.com. (She is in Montreal along with the third founder, Stéphane Hamilton, who is also president of the Web and mobile development company Jolifish.)
It turns out that a dispersed business setup is actually quite common. Stephen Partridge, a member of the board of directors of Startup Canada and a co-founder of the Events.com, notes that globally minded startups are often on the ground both in Canada and abroad, “and there are very good reasons for it. It all comes down to the objectives of the startup.”
For example, international markets obviously vary widely in terms of business models. Mr. Partridge says that for Events.com, a similarly internationally based service that helps those running events promote and manage them and sell tickets online, expectations change from region to region. Sales margins may differ due to preferences, such as customers in Europe using debit cards more than credit cards, which can change transactional fees, and thereby pricing and costs.
“The expectations of the market in Europe and the expectations of the market in Canada are somewhat different, with regard to the margins that can be made on ticket sales,” Mr. Partridge says. “That changes the product and your business model based on the international market you’re going into.”
With Soul.City offering its app for free, the question of what end users pay is moot (they pay nothing), but the variance in international markets can change the costs of running the company and how it makes its sales with sponsors globally.
“We’re in a very, very interesting time in our lives, because we are getting to the point where we are finding those big partnerships with large brands to monetize [the app]. And at the same time, we’re raising capital. We’re raising seed investment,” Ms. Charbonneau says.
Soul.City was also accepted earlier this year into the Paris-based incubator Le Cargo, furthering its foothold in France. “There were only five startups from Montreal selected, and we were one of them,” Ms. Charbonneau says. The incubator gave Soul.City office space in Paris for three months, assistance in developing the company and furthering its introduction to Europe’s startup community.
Ms. Charbonneau notes how their company’s strategy diverges from the typical one of tapping the States. “Most of the VCs [venture capitalists] and investors have connections to Silicon Valley. So what tends to naturally happen is that people and resources migrate on a North-South basis. I think for us to cross the pond is quite unique, and it is really basically because one of our co-founders is in France.”
An office on the ground in Strasbourg can be helpful in establishing a bulkhead in Europe to find sponsors for Soul.City. But at the same time, Mr. Partridge notes that Canadian startups generally have a good reputation globally, even those that keep most of their operations in Canada.
“We are so well received internationally from a client services and sales perspective that you can do a lot of that from Canada, by making sure you have a very high multicultural makeup in your office,” Mr. Partridge says.
The question now, as the company grows larger, is where it may grow next geographically. The owners don’t see tapping programmers in major tech centres because of the high cost, nor do they plan to outsource programming to countries such as India, Ms. Charbonneau says. And Strasbourg is itself a young-minded city with a tech community that the company plans to tap for interns, she says.
And the company’s growth also affects the division of labour in the company. “Because we’re growing, these questions are very key to us now. Where do we grow our actual team? Where do we put them? Who does what, where?” Ms. Charbonneau says.Report Typo/Error