After Ari Newman of Filtrbox spoke at Boulder Digital Works Idea Studio I had one lingering question. Can web startups that target small businesses continue to do so once large companies move in and begin using the startups’ products?
Filtrbox is a social media monitoring service based in Boulder that came out of Tech Stars. It was recently snapped up by Portland based Jive Software.
Filtrbox started out serving individuals and small companies. The goal was to give them a more efficient and organized way of monitoring conversations in the social space. When the alternative is Google alerts and scouring social media all day, this is can be a lifesaver.
Prices that were once in the hundreds of dollars are now up to $10,000 per year for up to six users. This gives customers unlimited use on the platform.
At last week’s Idea Studio, Ari spoke about now being able to service major corporations. However, this comes with a pricing plan that essentially cuts small business out of the picture.
This is where I started wondering. With any web start there is a drive to first prove the concept, then get users then reach profitability. If you start with small businesses and low cost for use with a good product, as Filtrbox did, you can garner users. Eventually the price has to increase to support the business.
That spurred Filtrbox to move on to larger companies with deeper pockets as their core market because that’s what the company had to do to stay alive.
Does this make small business a stepping stone? Can a company like Filtrbox actually continue to service small business in a meaningful way after the big dogs start paying significant prices?
I’m keeping my eye out for similar stories. Pass them my way if you know of any.