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Aug

ENTREPRENEURSHIP VOL.6. INCREASING THE CONSUMPTION OF READING

Written on August 31, 2014 by Vanessa Dezem Baida in News

Justo Hidalgo

Have you ever dreamed about accessing to your bookshelf from office, bathroom, park or anywhere comfortable for you? We are now able to access to whatever kind of information on the Internet. The freedom of accessing to books was the one thing left in the 21st century to be solved.  Mr. Justo Hidalgo, Co-founder of 24symbols, which is a beautiful online platform where the users can reach their books regardless of location, gives us opportunity to learn how he has developed such an amazing platform and got over difficulties to realise his idea.

 

 

 

1. To start with, please let us know more about your personality, background, and career. WHO YOU ARE? Why did you decide to be an entrepreneur? What kind of stories do you have behind that?

From an educational standpoint, I am a technical guy by nature and nurturing. I studied an MS in Computer Science and then, while working in startups, I got a PhD in Computer Science as well. I’ve gone from being a hardcore programmer and researcher to business-focused roles. But I always tend to the technical side, wanting to understand how everything works. That’s why, for instance, I’m taking Data Science courses now to continue thinking about how data can impact businesses. Regarding my personality… I guess it should be much better to ask the people around me ;) But I try to have a low profile, prefering to lead by example rather than having a more aggressive approach. I checked many years ago this is what works best for me when leading and managing teams and projects ;) I have always wanted to be an entrepreneur. I was the typical kid that was drawing comic-books and selling them to my schoolmates, or helping my mother’s business… by charging her customers and keeping a tip. My parents have always had their own local businesses, so I always felt I wanted to do something similar. But on the other hand, I saw the huge efforts they had to make both in the good and bad times, so while I decided I preferred to work in small startups rather than big corps, I didn’t have the guts to start my own company until my three partners and I pushed each other into building 24symbols.

 

2. You seem to have rich international experience in your life. How it is important for you?

Critical. I just had my first daughter and I have no idea how she will grow up and what decisions she will make, but I hope she does two things: to learn many languages, and to study and travel abroad. In my case, you need to understand the context of being a Spaniard born in the 70s: that my parents sent me to spend a summer in Chicago when I was 14 and then to study my high school junior year in Ohio (and remember, my parents were middle class, always working hard to save the penny) has undoubtedly had the biggest impact on my personal life and professional career. Personally, because you need to *live* abroad to better understand how the world works and how people really are; in addition, it pushes you beyond your level of comfort at incredible levels when you’re 14 or 15 yo. Profesionally, because speaking English has become, more than my engineering skills, or organizational capabilities, my main tool in my skill set. It was this what mainly allowed me to evolve from a hardcore engineer to an entrepreneur that moves along the border between technical and business.

 

3. The concept of 24symbols would bring about the paradigm shift in the publishing industry or would change consumer’s behavior. How did you come up with the concept?

The four founders all come from the IT industry, working in B2B companies. We share a love for technology, both from a purely technical standpoint, and also from what it can do to industries and people (hopefully for good, but also how it affects otherwise.) But we also tended to have coffee and lunch break conversations about books: management books, novels, … each of us has different tastes. So we came up with an initial idea which was to create a moonlighting project, a publisher that would bring management books from the US, translate them to Spanish and put them to market. Very quickly we realized we didn’t have enough understanding of what publishers and editors need to do :) But then one of my partners had a question: is there a Spotify for books? So we went out and found that there wasn’t, but that there were some very interesting discussions about that idea. We talked to some publishers and other stakeholders of media industries, and realized there was an opportunity. But, answering your question, how did we go from “hey, this looks interesting” to “let’s quit our jobs, our senior management and VP roles, and create a startup with lots of risks and low opportunities for successes“? :D Yes, the answer is because we love books and we’d love for someone to create this same product for us.

 

 

4. What was the first step you took in order to embody the business idea?

We had to break the chicken-and-egg problem every B2B2C company has: how do you get users if you still don’t have enough quality content, and how do you get high quality content if you still don’t have lots of users to compel the content owners? So we decided to focus on the users. Why should we quit our jobs if we found out that no user wanted a Spotify for books? We asked them. We created a web page, opened a Facebook page, a twitter account, and started to talk about our plans. Quite openly, nothing hidden. This is a video of our first mock-up, these are our thoughts about the business model, this is a presentation of our company, … and suddenly we started to hear from people who *loved* the idea, and who supported us from scratch, even if we still had nothing to show. That’s what really made us think we were unto something. This is now known as “customer discovery” in the Lean Startup jargon, but for us it was simpler: don’t jeopardize your life for something *nobody* actually wants ;)

 

5 What were difficulties at the beginning? If you had had the same amount of knowledge and experience that you have now, what would you have done or have avoided?

The timing with publishers. While the relationship with the content owners has always been good, publishing is an industry that is not accustomed to innovative projects, specially when they provide business models that are different to what they are used to. Our freemium business model offered an all-you-can-eat experience to the reader, while sharing revenues with the content owners. With what we know now, we would have started with a simpler business model for the publishers, as we do now. The good news is that when we decided to evolve our revenue model, it was the moment publishers were starting to understand how subscription works and how it could help their overall business.

 

 

 

6. Perhaps, people tend to compare your business model with Spotify. The idea of business would be similar but the business model would be totally different because you cannot consume 20 books a day, whereas you can daily consume 20-30 different music clips. What is the significant factor in your business model? How do you try to increase the consumption of reading?

We were compared to Spotify because of our user model, very similar to the music streaming service’s: a freemium model where people can read some books for free, with ads on the sides of the books and with some interstitial; and where premium readers have access to the whole multipublishers’ catalog with additional benefits such as offline reading. In addition, our 3-second pitch was perfect! The “spotify for books” ;) From a business model perspective, it is clear that there are key differences. Reading is an activity that requires concentration and that is not typically done every hour of the day, as opposed to music. On the other hand, reading a book requires more time than watching a movie. But what this just means is that the opportunities for engagement are different. And that users are “concentrated” on what they are reading is every app developer’s dream! This also entails that the main measuring parameter cannot be “the book”, which is a too coarse-grained entity, but “the page”, that we use to settle with publishers and to generate the metrics we use for product improvement and to report to our publishers. Regarding how we try to increase consumption, there are three main factors that affect its growth: (1) quality of the apps. I always say that being in an economy of attention, books do not compete against other books, but against any activity that takes up on people’s leisure time, like video games or watching tv series. So the first goal should be to create reading apps that make people think “wow, I want to check this out!”. (2) content. Services like 24symbols obviously require the best content possible from small and big publishers and authors. If users have a place, a hub, where they can read whatever they want, whenever they want, they will certainly find more opportunities for reading. (3) reader engagement. At 24symbols we have close to 600,000 users. This is a huge opportunity to provide additional services that increase their involvement with books, authors, or other users. We have the concept of the bookshelf, which is quite strong as anyone can create as many bookshelves as desired, and then share them, or follow other people’s shelves.

 

7. What kind of role does the social factor of 24symbols play? Why it is important?

Our motto from the start was that we wanted everyone to read whatever they wanted, whenever they wanted. Since we started working with mobile carriers last year, this has become a reality. There are many people around the world living in regions where mobile devices have deeply penetrated (specially Android smartphones), but where ebooks cannot be purchased legally because credit card purchases are nowhere near what happens in the US or in certain countries in Europe. Places where in order to purchase a book from an international retailer, an international credit card must be used. Working with carriers, we take ebooks to places it was difficult for them to be accessed, with a payment mechanism that is widely used by subscribers to access other types of digital content such as music or films. Books are culture, and they should be available in as many places as possible. With our limited resources, it’s what we are trying to achieve.

 

8. Do you try to restructure the reading experience? or simply to provide better solution for consumers?

I think both goals are related. We’ve been definitely focused on the latter, which is a quite complex task by itself. But by doing it, we had to think a lot about how people access and read books; how and why they stop reading or choose new books to read, etc. Data analytics is proving really useful there, and we are making an increasingly stronger effort in that regard.

 

9. What is your goal and vision in 5 years?

Ha ha! I am sorry, I don’t believe in 5-year visions, though we get asked this question a lot by investors, analysts and the like. When working in startups, many times you don’t even know what you’re going to be doing in 3-months time. But I can answer that in 2 years I want 24symbols to be one of the international leaders in ebook subscription services, providing high quality services around the world and not only in the “standard” places. That’s my goal and my vision, as simple as it can be ;)

 

10. If you can make a phone call to 20-year-old Justo Hidalgo, what would you say to him and what kind of advice you would give to him?

You’ve just given me an idea for a blog post ;) I think everyone learns from his/her mistakes, so I would be extremely careful had I the opportunity to do it ;) But I guess I would tell “little Justo” the following: (1) take more risks. Though always wanting to start a company, it took another 3 partners for me to co-found 24symbols. Has it been difficult? Of course. But has it been one of the best experiences in my life? You bet. (2) college is necessary, but just not enough, see what else you have around you. I was one of those guys quite focused on passing every subject on time (in Spain, Engineerings are quite tough and it’s not common to pass all subjects, needing two or more examinations). Of course it’s important not to take 10 years to finish the undergraduate courses, but there are many other things that can be done at that critical time in everyone’s life: travelling, playing sports in a more professional way, getting involved in more social activities, … (3) related to (1), but learnt at a latter stage: things don’t typically go that bad, so endure. As a poet whose name I don’t remember once said something like “how hard is to suffer, how beautiful to have suffered”. As with any other startup, we went through the valley of death in 24symbols. While it was hard as hell, it was one of the most enlightening experiences I’ve ever had, being able to understand many things about how life actually works.

 

 

 s4symbols

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