Armenian-founded, product validation platform Prelaunch.com has raised $1.5 million in a seed round. The new funds are aimed at helping the company expand its reach, particularly in the US market, in tandem with fleshing out additional product capabilities.
The seed round was led by Big Story VC with Formula VC, Granatus Ventures, BANA (Business Angel Network of Armenia), and Vahe Kuzoyan, co-founder of Service Titan participating.
When demand forecasting systems and practices fail, excess inventory ends up becoming the biggest culprit affecting a company’s bottom line. Moreover, according to Common Objective, 35% of all materials in the supply chain end up hitting the bins due to wishful thinking.
Looking to combat dust gathering on warehouse shelves, Prelaunch offers brands test their product concepts and gauge potential customers’ willingness to pony up and purchase all before flipping the switch on the production line.
“I started to research ways companies understand market interest. And I found that every current method was tied to discovering peoples’ opinions. The drawback here is that people don’t always do what they say. And this planted the seeds for a new concept — reservation funnels — which, unlike traditional alternatives like surveys or focus groups, is a system where customers place an actual monetary reservation providing tangible proof of their genuine purchase intent,” explained Prelaunch CEO and founder Narek Vardanyan.
Clients using Prelaunch will be able to offer their customers the option to put their money where their mouths are, laying down $10-$20 to reserve a spot in the purchasing queue and receive a discount in exchange for their loyalty.
From here, Prelaunch runs a series of analytics to determine whether a product will succeed in the market and identifies its actual customers.
"When potential customers place a reservation — that’s when their opinions matter," added Vardanyan. "This reservation confirms their actual buying intent and shows whether they really desire to buy the product. And unlike focus groups which pay random sample populations to share potentially irrelevant opinions, the insights and opinions gathered through Prelaunch.com’s surveys, and discussions are highly-qualified and relevant as the buying intent has already been confirmed.”
One year since launching, Prelaunch counts some 2,000 registered brands, including e-bike and e-motorcycle producer Fuell, as users, with nearly 1 million community members, a.k.a. potential buyers amongst its ranks.