Let’s Talk Tech: Marketing to a Captive Audience
While it’s proven that Blacks are prone to buy gadgets and use social media and text messaging more than other races. Getting a business off the ground in the digital world may seem out of reach for many African Americans who don’t have a high-tech education. But new entrepreneur and former prison inmate Frederick Hutson is proving that anyone can do it.
Last week Hutson, who has never been to college, doesn’t know computer programming and spent four-and-a-half years in jail raised an investment of $1 million from a technology venture capitalist for his company Pigeonly, a data company that creates economical connections between the disenfranchised and the free world.
Until recently, making a 15-minute phone call to a loved-one in jail would result in astronomical rates that could climb as high as $20 for a 15-minute call.
That’s a lot of money considering there are more than 7,000 correctional institutions across the country and more than 2.3 million inmates. But a Federal Communications Commission ruling has capped how much prison phone service providers can charge. While that will certainly hurt the telecommunications profits acquired by those targeting the inmate services market, it can open the door for smaller ventures like Pigeonly.
After his incarceration for trafficking marijuana, Hutson became aware of how valuable outside interaction was for prisoners, and realized that there was an untapped market for people who were searching for an economical way to connect with loved-ones in jail. He jumped on the idea, outsourced his software development through Freelancer.com and raised capital from family and friends.
For the most part Hutson’s background didn’t hurt him. In fact, it helped that he was transparent about his experience and understood the needs of his target audience firsthand. He also had help with wooing investors. Last spring, he was a participant in The NewMe Accelerator, which is short for New Media Entrepreneurship.
“I thought it was a great idea. I was most impressed by his understanding of his market from a business perspective so early on,” says Angela Benton, the founder and CEO of the NewMe Accelerator. The accelerator picks some of the country’s most innovative minority-owned tech firms and invites them to Silicon Valley where they receive mentoring and training with some of the regions most high-profile tech experts and executives.
“It can be inconvenient for people to go to drugstores to print photos and the post office to ship them, so what happens is family and inmates slowly begin to lose touch,” explained Hutson in an article posted on the NewMe Accelerator website. “The same goes for inmate phone calls that are unnecessarily expensive. I wouldn’t have been able to solve these problems if I hadn’t experienced it for myself.”
Hutson, 29, came up with two products Telepigeon and Fotopigeon, which has 7,000 users. Fotopigeon, which transforms digital photos into sharp, brilliantly colored, high-gloss prints that are shipped for free to as many recipients behind bars as you’d like. Telepigeon guarantees that both the inmate and family member save up to 70 percent on phone calls.
He plans to use the $1 million investment to hire a larger staff and launch additional products.
“In the long run, we’re opening it up to people who will use it in a way that will benefit both society and inmates,” says Hutson of his social enterprise.
Here are three marketing tips from Hutson on how to bring your tech idea to life:
Don’t focus on the tech. “Focus on the problem you’re solving and your business model,” says Hutson who wrote his business plan while still living at a halfway house. People get caught up in the technology. Tech is just the means to deliver the product or service. In that sense, you’re not crippled if you don’t have a technical background.
Don’t be intimidated. The financial barriers of getting started in the tech industry are substantially lower than before. For example, at one point in time you had to physically buy a server, now you can go to Rackspace and crank up a server for $10 and put everything in the cloud. You can have some one from 99designs create your logo for much of nothing. Leverage an international workforce to get things done at a low cost.
Don’t be afraid to really open up. Share your idea with people who can add value to your company. Understand that the idea itself is worthless and it is you and your drive and execution that makes the idea valuable. The more people you talk to the more resources you’ll acquire.
Don’t worry if you’re not based in Silicon Valley. “For our company, it didn’t make a difference where I was based. Being based in Las Vegas, has a lower cost of living and helps us keep our overhead low,” says Hutson. “Once you have the relationships, you don’t have to get caught up on the whole SV thing. There are a lot of resources in other cities. You definitely need a footprint in Silicon Valley, but you don’t have to be based there.