Prompt.ly, a platform providing scheduling, invoicing, payments and promotions, recently launched a mobile app that helps very small business owners — what CEO Richard Titus calls “solopreneurs” — easily manage their businesses on their phone. The company kicked off with 500 users this past December and has rapidly grown to 18,000 solopreneurs today, a number Titus believes will only continue to increase with the launch of the app and its coming updates.
With the app’s latest feature, Prompt.ly Pay, providers can invoice their clients in two clicks and clients can now pay each of their providers with a credit card. Titus says that the next step for Prompt.ly is an upgrade the free app’s Prompt.ly Promote feature that currently allows users to create and send promotions via email, SMS, and Facebook. A step up from Promote, Prompt.ly Ads, which is available on the premium version of the app, will take users’ self-made promotions and syndicate them on Facebook’s promoted posts.
Street Fight caught up with Titus to discuss the launch and next steps for providing business tools to solopreneurs.
Prompt.ly combines elements of payment processing (like Square) and scheduling (like Booker), aimed specifically at what you’re calling “solopreneurs.” What was your “eureka moment” that led you to start this company?
I had a personal trainer, one of my daughters had a violin teacher, and the other had a drum teacher and a tutor. These people were amazing at what they did for a living but they were the most disorganized human beings I’ve ever met in my life. I found that whenever I had to reschedule with one of them I would get really worried about the awkward conversations we’d have about who owes whom if there was a cancellation. I figured there had to be a piece of software that they could download to their mobile phones that would help them run their businesses, so I started downloading different types of software and calling everyone I knew that was what I call a “solopreneur” and they all said the same thing: it doesn’t exist.
I probably wouldn’t have done anything with that knowledge, but I eventually bumped into my business partner Eli-Shaoul Khedouri, who had just left Everest, and he had been working on a startup around data acquisition. He pitched me an idea to use public and private databases to locate hard to find groups of people and I realized it would work really well for small business owners who are hard to find through traditional market channels.
Before we really wrote a lot of code, we spent about 6 months doing market research, customer sessions, and some prototyping because my background is on user centered design and I really wanted to understand what was the minimum set of functionality that people needed and what would really drive them to use this product. It turned out it was a lot more complex a product than we thought, but we spent the time working it, we raised $1.5 million last Christmas, and since this Christmas, when we had 500 users, we’ve expanded to the 18,000 we have today.
What specific needs do these very small businesses have that are different from larger companies?
First of all, what we find about our customers that’s different from others is that 30 percent of them don’t have computers and instead their primary computing platform is a mobile phone. Of the 70 percent who do have a computer, it’s usually old and tucked in a closet somewhere. These people are actually very digital, but they can’t use 90 percent of the scheduling or accounting programs out there because they all require computers.
The second thing is, they all use time, by the hour or by the session, as a principle unit of inventory. Unlike a retail or food business, with time, you have an infinite number of units but only one of each – you have one four o’clock on Tuesday or one 3 o’clock on Friday. Most invoicing or management systems don’t really allow for that until you get up to the most complex scheduling systems, which aren’t available on mobile phones.
Also, one of our users said he used a Groupon once and got 30 new customers, then for the next year and a half he called one of those people a week saying it was time to use their Groupon. He didn’t need 30 customers; he needed one this week, one next week, and so on. That’s a different problem than most marketing solutions are solving out there, but we understood where he was coming from so we could really architect a solution for that.
In that case could the app also be used by larger local businesses?
A big chunk of our users are local businesses, but we’ve really targeted Prompt.ly exclusively to the sort of one-man band, solo practitioner because those larger groups have solutions that are already built. One of our users, Allie, is an aerobics and yoga instructor working out of three studios in addition to working with 12 private clients. She has five calendars she’s managing, she has to invoice those three studios as well as her private clients, she has to track her availability for her ex-husband to find time with her child, and she uses Prompt.ly for all of that. Before us, this was all done on paper. Another user, a tutor in San Francisco, says our software allows him to collect 50% faster than ever before. With Prompt.ly Pay, which allows a client to pay a provider with a credit card at no cost to the provider, 30% of his clients pay him on time with a credit card.
What is your business model and how did you decide on that strategy? Is it transactional, or a membership/fee basis?
We have a SaaS model for primary revenue. Prompt.ly is free to download and use, then we have a premium model with a small subscription of $10 up to $150 for a hyper compliant medical version, and a few packages of cart services like advertising or promotions that you can pay for as well. We also have a transactional charge through Prompt.ly Pay for credit cards. Providers really hated credit cards because of the transaction charge on their end so what we’ve done is turned that on its ear. Now if a client wants to pay a provider with a credit card it’ll cost 2.99 percent plus a processing fee, but you can pay all your providers in one place – no more checkbooks. For the client that’s a real selling point and for the provider they get their money in their bank account in 2 days.
Where do you see yourself competing in the hyperlocal space? What other companies do you see Prompt.ly taking market share from?
It’s funny; the people that we’re the most dangerous to are companies like Intuit that are selling Quickbooks to people who really just need a minimizing solution. Prompt.ly invoicing has two-click invoicing with payment in one. Intuit is never going to be that easy because they don’t have mobile client and they don’t really think about simple invoicing which is about 30% of activity on that platform.
We’re also probably a threat to small advertising solutions. We have Prompt.ly Promote, which is in the free version, and, coming soon, Prompt.ly Ads, which is an ad solution to syndicate promotions on Facebook promoted posts, on Yelp, and other platforms like that. Through that we take the chunk of users’ money that’s currently going towards un-attributable, un-trackable marketing and turn it into trackable, referable, digital marketing.
Do you think this “solopreneur” concept is something with staying power? Why is it more possible for people to run these very small businesses now than it was five years ago?
These businesses have always existed, though I think they’re definitely growing. One of the interesting themes we see in society is the breakdown of the industrial complex where you go to work for 40 years and you get a watch and a pension at the end. Unlike Uber or Handy, which are really trying to subordinate the worker as sort of an unbranded, homogenous service unit, we’re focused on a more centralized model and we want to give power to the people who are breaking out on their own by giving them the tools to run their own businesses.
The reason why I think this is happening now is partly because of technology, but it’s also because the work is different. In the old days we needed 10 or 20 people to do a chunk of work most of the time, it required massive collaboration that can now happen digitally so you can work more individually. I think it’s important to give these solopreneurs the opportunity to run their own businesses and make as much money as possible.
Ally Reis is an assistant editor at Street Fight.