Seven years ago, Chris Chong and his brother Karl went door-to-door in Singapore’s Chinatown to sign skeptical merchants onto Beeconomic, their Groupon clone. Soon, Groupon itself came a-knocking, buying their business for millions.
Today, Chong is banging on doors again. His latest venture is SumoStory, an affordable public relations firm that serves startups who can’t pay US$3,670 a month for a standard PR package.
“Entrepreneurs starting tech companies are usually high-risk and unattractive to traditional PR firms. We hope to sieve out promising startups and establish a strong PR partnership with them early on,” he says.
SumoStory offers two six-month packages at drastically lower prices, one at US$588 flat and another at US$1,760.
It keeps prices low by using a scraper to extract information about journalists. An algorithm then matches the #startup to the right reporter, who then receives a pitch from SumoStory.
However, it’s still early days for SumoStory, and its pricing is sustainable right now because Chong isn’t paying himself a salary and is employing mostly part-timers.
As such, the margin on each package is “almost 100 percent,” he says, as he hasn’t done any paid marketing yet.
More automation coming
Keeping SumoStory sustainable will require making its technology useful enough to replace significant human labor. Right now, Chong says the algorithm saves an hour’s worth of labor per press release.
He’ll expand the algorithm to further automate the internal process. He’ll also let journalists use the same algorithm to identify SumoStory’s clients who might be sources of stories.
By 2018, Chong hopes to invest in natural language processing (NLP) to see if press releases can be written automatically. That’s not a stretch – companies like Narrative Science and Wordsmith are already generating reports with data input.
SumoStory has signed 23 clients in the past month and targets technology companies with under 50 employees. It hasn’t raised outside funding but plans to secure a seed investment in the coming months if things go well.
Chong estimates a massive total addressable market of US$66.8 billion in Southeast Asia – that’s if every entrepreneur in the region signs up for SumoStory’s packages.
Just counting SumoStory’s most likely customers would yield 7,000 tech startups in Southeast Asia, resulting in potentially US$8.22 million in annual revenue from its target market.
Of course, the actual revenue SumoStory will obtain in the next few years would be lesser still – unless it broadens its market beyond tech startups.
Chong kept himself busy after selling Beeconomic. He ran Groupon Singapore with his brother for four years and launched a couple of failed startups before hitting a potential goldmine in SumoStory. He also served as the social media editor at the South China Morning Post.
One of his so-called “fail-fast-fail-often experiments” was GoFresh, an online grocery site that launched in 2014.
“Like Redmart, we struggled with the slim margins on groceries, and couldn’t push down the cost of logistics and delivery,” he says.
GoFresh also didn’t attract enough loyal customers to justify the cost of acquiring them.
From that experience, Chong learned the importance of doing market research to test all his assumptions before starting a business.
“When working on SumoStory, I really ensured there was a genuine problem that I could solve,” he says.
Converted from Singapore dollars. US$1 = S$1.36.