1. What is the business model and what would change if it takes a B2B approach?

StickK is a goal-setting platform which uses “commitment contracts” to help its users
achieve their goals. Basically, stickK is free; but in order for it to work effectively users
are encouraged to create commitment contracts with monetary involved. You will only
be billed when: you report that you were unsuccessful; or your Referee reports that you
were unsuccessful; or you fail to make a required report by the end of the second day
following a required reporting day.

The approach and the working model will be changed if it changes to B2B approach.
For B2B model, product customizations will be there for separate companies which
requires more employers/developers. And also it requires separate maintenance team
for separate clients.

2. How does stickK make money? Calculate revenues for B2C model and B2B model. Which
one is more lucrative?

B2C
 For all Commitment Contracts for which the Recipient is an anti-charity, 29.5% of all
Stakes + card charges.
 For all Commitment Contracts for which the Recipient is a charity, 19.5% of all Stakes
+ card charges.

StickK is right now in the freemium model for B2C where it offers services to gain
future transactions. And now through “Commitment Contracts”, 32% of contracts are
with stakes and 80% of them are successful. Contracts that included stake had an
average stake of $360.

For 100 users,

Charity :
% of Charity * %of unsuccessful charity * average cost
(21.6%)*(19.1%)*($360)=$14.85

Anti Charity:
% of anti-Charity * %of unsuccessful anti-charity * average cost
(52.1%)*(12.9%)*($360)=$24.19

For 100 users StickK gets $39.04.

In 2012, users has reached 1,00,000 and committed contracts has reached 70,000.
Taking on above it will get around $273,000.
 B2B

For B2B, StickK charged a flat startup fee between $20,000 and $50,000 to develop
private label platform for the client. This was largely devoted to software development
costs.
It also charged monthly administration fee between $10,000 and $20,000 depending on
users.
It would cost them $85,000 per year extra.
Due to this B2B, there are needing 2 managers for a year.

Taking on average, $35000 as startup fee and $15000 per month , they would get
$205,000 per B2B transaction.

This would be suffice for the new manager which will be backing them up.

3.       What would you recommend to Jordan Goldberg?

I would recommend that StickK to enter B2B as well as maintaining the B2C since its user base
is growing organically. In B2C they can add more features like coaching for subscription model.
stickK can also add in features such as reminders or coaching to its users on how to achieve
their goals which can be a premium feature for a subscription; because it is already a great
motivation application, it can also become a coaching application using the same concept.

Along with B2C, they also need to go with entering into B2B as the least no of users gives them
$150,000 and average users gives them $205,000 and higher users gives them $290,000, so
they will be needing 2 managers per year which they can manage with this amounts.