One of the most common interest that you find in everyone around is – Reading Books. Readers can be put under different buckets – hard core readers / bookworms, some just read based on their interest in a specific genre, and some are just browsers. But most of the readers, though have interest in reading don’t ever finish a book they start. Most common reason to be not able to finish the book they started is that they don’t have time to finish a 500 page book.
Four gentlemen realized the gap, studied the market size and created a Product called Blinkist. Founded by Holger Seim, Niklas Jansen, Tobias Balling, Sebastian Klein, out of Berlin, Germany in 2012, Blinkist, is a startup that gives readers the crux of popular nonfiction books in 15 minutes or less, has blinked around 1500 books already. This way Blinkist filled the gap, made available for people more reading into their daily busy routine by delivering the key learnings from non-fiction books.
Blinkist engages subject matter experts / writers to condense widely known nonfiction title into 15 minute of summarized version. Blinkist is a subscription based service available on all major platforms – Website, Google Playstore for Android devices and Apple App Store for iOS devices. Once subscribed users get free access to one book every day, after which there is a subscription fee of $50 per year which allows them to have access to unlimited titles. Users can pay extra $80 per year to have access to audio formats.
Let’s do some simple maths: Yearly Cost v/s Yearly Revenue
1) These are rough estimates and even if we are close to 50% of it being right, we want to understand the potential of the same
2) Estimating current business and not when they started
Potential Target – $50 MM Yearly
($50 per subscription, they would need 1mm readers from across the globe)
Now let’s look at the basic cost to drive this business/achieve this target. Three major components are Technology / Content / Marketing
- Technology – Web and App you need 4-5 Techies – Designers/Developers/Testers/Admins – 100k each = 500K USD Yearly. Let’s keep it 1 MM for miscellaneous items.
- Content – Considering Blinkist already having 1500 Titles under their belt – from here they need to add 500 Books / month with good quality, good target to have for steady growth. If 1 Writer can generate 5-10 Books in a month, we need 100 writers to have 500 Books a month. Average Cost of writers – 50K USD (higher side) considering you get very good writers from different Geos (cost differs). Lets keep 1 MM for miscellaneous items.
- Marketing – 1.25 MM USD – Considering industry average of 2.5% of Revenue should be invested in Marketing. Don’t forget, for any B2C business, Word of Mouth is a pretty important/big component (doesn’t cost anything)
We are looking at:
1MM USD for Tech side + 1 MM USD for Content Side + Marketing 1.25MM USD = 3.25 MM basic cost. There are other overhead costs for which if we add another 1.75 MM USD, we are looking at the Total cost of 5 MM USD for the year to achieve potential of 50 MM USD revenue = 10X
For your understanding of the English Language eBook Markets, Major Players, Expansion of the Major Platforms, Patterns of Change (Digital Growth, Decline in Print and shifting forces) and much more, here are some Research reports for reference.
Brains behind Blinkist:
- Niklas Jansen
- Holger Seim
Co-Founder and CEO of Blinkist.
- Sebastian Klein
- Tobias Balling