This update is going to focus on the effects of the COVID-19 pandemic in the global trade of recyclables and our plan for taking this as an opportunity to rapidly increase the demand of Tradefox within our industry.
Since the launch of our last crowdfund campaign, our sole focus has been on creating a system for housing the reputations of the companies around the world. The ultimate goal has been the development of a product which will replace the need for people to meet in person in order to trade globally. We’ve been working with this focus for 3 years now. From this standpoint, you could say that we are optimized for creating value in a crisis that limits the amount of personal interaction people can have in global trade. I believe we are definitely the leading company in our industry that is able to facilitate trade between parties at scale during and after this global crisis.
Covid-19 Pandemic Provides a New Opportunity for Tradefox
As COVID-19 pandemic concerns surfaced, we began asking ourselves what we could do for the industry. As the annual conferences in our industry around the world were canceled one by one, we immediately saw how we can provide value. We zeroed in on the idea of being the first company to bring a virtual conference to the recycling industry and have been working for two months now to research and develop this capability.
Located in our building in Amsterdam, is another startup by the name of Network Tables. We’ve known their team for more than three years and knew they had become very successful in facilitating virtual conferences with their SaaS product. After several conversations with them, it became clear that integrating their technology into our product would enable people to obtain even better value out of a virtual conference than they would with a physical conference. This is because we have the data to help attendees better match themselves with other potential trading partners for one on one meetings resulting in a much more valuable conference experience.
The Need for a Virtual Recycling Conference Validated
To validate the need for this product offering, we spent two weeks calling customers at random to get a representative sample of people who work for various sizes of companies and had various roles in trade. The end result of the survey was an overwhelming yes! Almost everyone saw that this pandemic was going to change the way business was done but they didn’t have a clear idea on how the industry would get through this crisis. This opened up an opportunity for us to become thought leaders in the industry, blazing a trail forwards towards the digitalization of the global trade of recyclables, which of course has always been our end-goal.
The Short Term Benefits to Tradefox
The key challenge we have been facing recently is how to reach critical mass in terms of usage of our product and the contribution of feedback data from our members. In order for our product to achieve critical mass, we need to have hundreds of companies contributing thousands of feedback data points each month about trades they participated in. We have been working on a way to achieve this critical mass organically with limited success. However, we now see a great opportunity to reach this milestone by hosting virtual conferences for our industry.
Being the first company to bring a needed and important technology solution to an industry suffering from a crisis should cast us in a very favorable light. We believe that by hosting quarterly virtual conferences for the recycling industry, we will be able to earn from selling a product which is very similar to a product in which our customers see value and which is 5 - 10 times more expensive.
We see the potential to attract hundreds of attendees by marketing to our database of free members in the industry that trade recyclables. At 3,500 + members, we actually have more members than any trade association in the world currently. For this reason, we believe we would be able to convince somewhere between 200 to 400 people to join our first conference.
Every conference attendee will receive a two-month free subscription to our trade reputation reports product which will be seamlessly integrated into the conference experience.
Our Tech Development to Date
Our developers have been busy building this functionality and we expect to have the beta version ready within 1 to 2 weeks. Based on the work we've completed so far, we will be able to provide:
All this will be facilitated through integration with Zoom, a popular video conferencing product. We also have the ability to sell tickets via integration with EventBrite, an event ticketing product which processes purchases.
Tradefox Conference Delivers More Value than a Traditional Conference
Our virtual conference USP is that we will be able to allow attendees to better identify potential new trading partners to facilitate one-on-one meetings with the people who have the highest chance of becoming valuable business partners. We can facilitate this via integrated access to Tradefox information on the reputations of companies, the type of material they are dealing in, their location and more.
In our survey we learned that our customers measure the value of a conference primarily on the number of successful one-on-one meetings they have with prospective new business partners. We also learned they don't like the fact that a lot of time is wasted speaking to people who ultimately cannot add value to their business. In essence, our customers want a more efficient method of meeting trustworthy new trading partners and that's exactly what we can deliver.
The Value Proposition of Hosting Tradefox Conferences
A virtual conference gives us a platform to communicate our vision for the future, educate others on how our product works and to share our vision for the digitalization of trade. I would be a keynote speaker at each conference and will use that opportunity to get more companies to buy in to participating in our feedback and data contributor programs!
The great bonus we see in hosting virtual conferences is that this can be used as a marketing tool for enrolling hundreds of new subscribers instead of dozens of new subscribers per quarter. At the end of every conference, every attendee would understand how our product works and would have used it to facilitate meetings with potential trading partners. Assuming we are able to deliver an exceptional experience and value to people in our industry, we expect more than 70% of conference attendees to convert into monthly subscribers.
And we don’t plan to offer this conference for free. In our market research we have determined that we can charge between $100 to $250 per attendee for our first conference. We will go most likely towards the lower end of this pricing range in order to recruit more attendees for the first conference. According to our customer survey, we could offer tickets for future conferences in the range of $500-$1000.
We are preparing to take advantage of a situation which forces people to reconsider how they trade internationally. Through this virtual conference experience, we believe we will be able to quickly become highly relevant to many more people in the industry, increasing the amount of companies that are contributing data to us. This will allow us to reach the critical mass required to reach our next goal, which is to partner with a commercial credit insurance company. Additionally, we see substantial revenue opportunities in front of us.
Using Professional Guidance to Steer Our Vision
I want to also mention that we have been receiving the latest scientific information from one of our largest investors who has been acting as an advisor on COVID-19 and an executive at one of the leading pharmaceutical companies. This information leads us to the opinion that we have a window of a minimum of six months up to two years to penetrate our market with this exciting new product. The need is right now for virtual conferences. We are currently planning to launch the first conference in the first week of July followed by a second conference three months later.
More Investment Needed
In order to achieve maximum success, we will need more investment! These funds will be used to hire two additional resources for social media marketing and for conference planning support. Our crowdfunding campaign has been extended until the end of August allowing us 3 additional months to accept investment via the WeFunder platform. An additional $250,000 would provide enough operating capital to extend our runway by 6 - 10 months depending on our success with conference ticket sales and the conversion rate of attendees to monthly subscribers.
This investment amount could bring us to break-even as well, but because of many unknowns (first time hosting a conference, unknown ticket sales price, unknown number of attendees) I don’t think it's meaningful to share revenue projections. One thing which I believe firmly is that being able to pull off a very successful conference will dramatically boost our company into the global industry spotlight resulting in an acceleration to our growth.
Therefore, I would like to ask every investor to consider adding more to their investment with us. If you have invested $200 or $5,000 in this round, please consider doubling that amount if financially feasible.
I’m also reaching out with this message to all accredited investors. If you are an accredited investor or a non-US resident, and or interested in investing an amount approaching or exceeding $10,000, please contact me directly right away for information on the terms of the new Regulation D funding round which we are running along side our WeFunder campaign.
On behalf of our team at Trade Fox / Scrap Connection Inc., I want to thank everyone for your investment! We are very excited about 2020 as we see this as our greatest opportunity as a company to reach the success we've been working towards! We look forward to the chance to provide you with an outstanding return on your investment!
Chris Yerbey, CEO
Scrap Connection, Inc.
+31 6 5392 8886 (Dutch Mobile and Whatsapp)
+1 (404) 512-1742 (US Mobile)
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