Local knowledge has long been the Holy Grail of travel, with countless startups pledging to help users "travel like a local" or get "insider tips" on the best places to go in a city. However, much of this rings hollow, either because of the derivative nature of the value proposition or the lack of actual actionable tips into the local destination.
Locish is a new startup based out of Greece that is attempting to deliver this value proposition effectively and accurately by directly tapping the local psyche.
Travelers open the app, and then click on two options: food or nightlife. They then enter a few lines about what they are looking for, and adjust a distance slider that affects the area in which local experts will make suggestions.
After submitting the request, local experts respond with their suggestions. At the moment, the service is free but the company promotes the fact that local experts do indeed make money - meaning that monetization will come at some point.
There could be a creative opportunity here that allows the service to remain free - for example, local businesses could pay to have a paid listing in the organic list of expert suggestions. This would allow the experts to get paid, and the company to take a cut from the sponsored content without having to ask users for payment.
This would have to be very clear, however. If the service is seen as pay-to-play - for example, if the company were to receive a kickback each time a traveler visited a particular business - the authenticity of the results would be severely diminished in the eyes of the traveler.
Co-founder Alex Alex Christodoulou shared the following video about how Locish works, and explains more about his new business - including monetization - below.
Tell us how you founded the company, why and what made you decide to jump in and create the business.
We were two good friends from Greece – a software engineer and a business guy – and while on a trip to Hungary, we couldn’t find updated info about where we could have some fun. We spent lot of time doing research and came up with crappy places. We thought, “how great it would be if we could ask a local similar to us through our iPhone about where to go?”
And that’s what we started working on right after our trip.
What is the size of team and names of executives and key personnel?
Three brave men: J Alex Christodoulou (Co-Founder), Greg Zontanos (Co-Founder), Arthur Saveliev (1st and last employee at the moment).
What are your funding arrangements?
We’ve already raised $80K on March 2013 from The Open Fund (a seed fun for companies registered in Greece), and are currently raising a seed funding round to grow the team and expand our operations.
What is your estimation of the target market size?
There are one billion international travelers and 30% of these travelers are using smartphones in destination to reach travel information - that's an immediately addressable market of 300 million.
Please outline your concept's competition.
As competition, we see all the big players in recommendation: Yelp (US), Google Places, TripAdvisor, Foursquare.
What is your revenue model and strategy for profitability?
By trying to make Locish a decision maker for travelers, will try to monetize from all related businesses: affiliate bookings, targeted promotions & ads, sponsored rewards to locals, premium services for travelers (e.g. virtual personal concierge), commissions from transactions between locals & travelers.
Describe what your start-up does, what problem it solves (differently to what is already out there) and for whom?
Locish is a mobile app where travelers get peronalised recommendations from local people, in real-time, in-destination.
All the traveler has to do is send his or her free text question to Locish, and in less than 5 minutes, he gets recommendations from like-minded people in town. These locals have read the question and replied in real-time.
Tell us why people or companies should use your startup.
A traveler doesn’t necessarily know everything about the visited city. On the contrary, locals know their city well.
With Locish, the traveler doesn’t need to read & filter noisy reviews in order to decide where to go. The locals do it for him or her.
Apart from saving valuable vacation time, that way the traveler may get information that TripAdvisor, Yelp, etc. are not aware of - such as hidden gems, parties, events, special days, and other things known to insiders. And what's more, the recommendations come from people with similar lifestyle and taste, and are not “one-for-all” as in every recommendation system.
Other than going viral and receiving mountains of positive PR, what is the strategy for raising awareness and getting customers/users?
There are three areas that we're focused on to attract, and keep, users:
1) Locish tries to help travelers through social & location-based apps as a surprising service;
2) We are in the procedure of offering a “Locish Exclusive” to hotels and airlines for their premium clients in order to penetrate to the high income segment of travelers;
3) Referral programs for our users.
How did your initial idea evolve? Were there changes/any pivots along the way? What other options have you considered for the business if the original vision fails?
At first we tried to make local people create their own content (places they love with photos, average price, opening hours etc) but even though they loved that (we had more places than TripAdvisor in Athens in 20 days), it failed because of a few reasons.
We pivoted to make Locish a “human layer” above existing content provided by big players, and this worked well.
What we envision is “assigning tasks to locals”, so maybe another thing we could do is putting locals to compete in booking hotels/Airbnb houses as a task assigned from travelers.
Where do you see yourselves in 3 years time, what specific challenges do you hope to have overcome?
In 3 years from now we want to have launched in all major US & European cities, and be a decision maker for every question made in Locish.
Our main challenge is to have a solid monetization model that can keep the locals motivated to offer fast and quality services.
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
Traveling includes a lot of stress, and people tend to plan the details of their trip ahead since they know that when being in destination they’re helpless. Current mobile technology as also the growing popularity and acceptance of the “sharing economy” allows this to change.
Traveling can be done without planning, as long as there are efficient services to help you (from Flightfox and HotelTonight to Locish).
Tnooz view:
Locish definitely has a climb ahead of them. What works is that there's no chicken/egg issue as far as having enough content to be appealing to travelers. Those who are tired of going through countless reviews will be happy to simply submit a request for suggestions and have locals respond directly, in real-time.
The company will need to figure out how to pay these local experts fairly quickly, however, as it will be vital for Locish to provide quick responses to user queries. Most travelers won't wait for hours for a response, and the company could lose them to their competition if they don't provide quick response that also succeeds at getting the traveler what they want.
The other issue still unanswered is how much travelers want a direct, local concierge style service.
Is this something that they want? Are travelers so used to reading and filtering their own reviews that they will just continue doing that, or has the user review space gotten so noisy (and potentially fraudulent) that travelers are wary of giving too much credence to user-submitted reviews? Finally, are the local experts going to be vetted enough, and matched to individual travelers, to ensure accurate suggestions? This could prove to be just as fraught as trusting user review sites riddled with fake reviews and personal agendas.
On the other hand, as more travelers get used to traveling without much of a plan thanks to successful apps like HotelTonight, they will most certainly be seeking out direct-to-mobile solutions to help them navigate spontaneity successfully.