Creating a membership service is the core foundation of a digital empire strategy and should definitely be the first piece of code you develop. The number of members you sign up to your service and your ability to maintain a growth rate is a major factor in revenue and valuation. If you look at every major internet service acquisition where startups are bought for billions, how they determine the purchase price was based on the number of members that startup service acquired with rapid growth. In this article, we are going to present a case study on how brothas and sistas can build and implement a hood business model off the membership service.
A while ago, Dream and Hustle wrote about circular economics and how we can reinvent the Black community and jumpstart economic development by implementing circular economics against some of our existing business models in the hood. One of the models was the Laundromat service model or the Launderette service model if you are in the UK (http://dreamandhustle.com/2013/05/rethinking-the-hood-laundromat-model-from-utility-model-to-access-model/). In this article, we are going to show brothas and sistas how to actually create a Laundromat membership service model that will be built using ASP.NET MVC4 hosted on a $5/month GoDaddy site and can be used to sell membership services to existing Laundromats in the hood. We are going to discuss the business model, the technical model and putting the hustle together as a case study for building a digital empire in the hood.
The Business Model
In this business model, you are not owning a Laundromat, instead you are creating a cloud-based service that outsource managing the membership of the Laundromat. We hinted at this service model in the previous article about the Laundromat and this is the model we are presenting in this article. In the diagram above, you see the major entities of this business model with the membership service being the foundation, let’s get into each entity:
Membership Service. This is the ASP.NET MVC web site you are going to initially create and host on a $5/month GoDaddy account to manage the members and services. This web site is used to sign up Laundromats to the service, allow people to find their Laundromat and start a recurring subscription and allow the Laundromat to verify members when they arrive. Also the Laundromat will be able to view their membership numbers and when they will get paid or a sweep into their bank account.
Laundromat. Now, there are two types of Laundromats that we can discuss in the hood right now. The first one is the existing Laundromats who are struggling on thin margins using coin-based machines who can switch to the membership model and disable the coin part of their existing machines for unlimited use. The second type of Laundromat is the startup that can just buy non-coin wash/dry machines from a department store, rent a cheap space in the hood and sign up members. You need to know how to approach the existing Laundromats to upsell them and also convince new startups to launch club membership Laundromats in the hood and use your service to start generating revenue.
Members. There are two types of members to you in your membership service. The first type of members are the Laundromats that signup for the service and these Laundromats usually have owners who use an account to login to verify and signup members as they come into the door, setup their direct deposit information for monthly sweeps and they check their progress. The second type of members are the actual people who use the Laundromat and is billed monthly and these are who you will refer to as members and you will refer to the Laundromat owners as your customers. You are managing the members for your customers in this service.
So let’s do a scenario for the business model and if you good at spreadsheets, you can project these numbers in your excel sheet for your business plan. You charge the Laundromat $4.95 per user per month for your service. The Laundromat can charge $29.95 a month or whatever but they pay you $4.95/month per user. Now we already explained how the Laundromat can work with apartment complexes to outsource the laundry facility and we talked about how density urban areas with 50,000 residents per square mile in areas like the South Side of Chicago.
So if you execute this model in cities all around that need Laundromats around the world and they collectively gather up 50,000 members, then that is 50,000 x $4.95 = $247,500 a month in revenue which is $2.97 million a year in revenue from your $5/month GoDaddy hosted account with ASP.NET MVC managing members. It is possible to get 50,000 in one New York City borough alone just to give you an example of the market size. And then you have Newark across the way right? And we haven’t discussed college towns were students off-campus want to head to the Laundromat.
By now, you probably just realize something – why didn’t nobody who read Dream and Hustle and that Laundromat article I published over a year ago actually move on it and did the additional research? The reason why is our people come to Dream and Hustle and just read and wait for the next article instead of handling their own business. Or even worst- they start wanting to judge me putting out this information and ask why I haven’t done it myself instead of thinking about what they should be doing for themselves.
For the record, the 3rd Strategic Institute already created the ASP.NET MVC cloud operation for this Laundromat business model – to target the Asian market with a much higher density population. And we are looking at the UK with direct debit for the launderette model there. So I always kind of laugh when some ignorant African-American who spend too much time on Facebook liking Dr. Farrah Gray postings want to concern themselves about what I’m doing instead of focusing on what they can be doing for self.
Had an African-American took the previous Dream and Hustle article seriously, they would have created a Laundromat service model solution in the African-American community by now and had a multi-million dollar operation in the hood, creating jobs and economic activity. But African-Americans want to sit around and talk shit and have economic roundtable discussions and watch Melissa Harris-Perry and talk about Dr. Claud Anderson and read 48 Laws of Power and shit all the damn time – that’s why no one did the numbers to this business model above and moved on it because our black people are currently full of shit at the moment when it comes to self-empowerment and entrepreneurship. Looking to see someone else get rich first before they are “convinced” and by that time, it’s too late or they were full of shit all along, more likely the latter when it comes to our people.
The Technology
There are three components to the Laundromat membership service, the Laundromat portal, the member portal and the operations portal. Let’s discuss each one.
Laundromat Portal. This section will allow an owner or manage signup their Laundromat for the service and manage their profile such as the direct deposit and view the next monthly sweep and number of members. This portal is also used to allow the Laundromat verify members as they come in the door and see if they are an active member or they need to renew their membership.
Membership Portal. The membership portal allow people to find their Laundromat and register entering their checking account and routing number or credit card to be billed monthly. Also, the members should get a custom PVC card that they bring to the Laundromat to scan or they can login and use their mobile phone to create a temporary card to scan. When registering, you can have the member take a photo of themselves and upload it to be the ID photo on the card – the Laundromat will decide whether to accept or not accept the photo if the photo is not right.
Operations Portal. Most of this is automated but this section is where you process new Laundromats and members and look up information on members and Laundromats who have questions. Also you create a dashboard that allow you to see how many Laundromats you setup, where they are located and number of members so you can strategize what new markets you want to enter and grow your hustle globally.
Now before we move on – do you realize something? Yes, this is the same pattern and design of Shop Wall Star QR shopping wall posters where we sign up merchants in a merchant portal, customers scan QR posters and shop and you run backend operations. This is why I focus on telling you about patterns and practices because as you see, once you have a technology foundation, you can create unlimited digital empires around the world. For a cloud service operation, you create a portal for the customer (Laundromat), a portal for the members (Laundromat users) and a portal for your backend operations.
Now, I’m pretty sure someone is saying right now “hey, why can’t I use PaySimple that does the automated subscription billing? I don’t need to do this shit!” and have some feeling of one-uppance over Ed Dunn and the 3rd Strategic Institute and that’s how our crab in the barrel black people like to think – more concern about having uppance over another black person than understanding the business solution. When you go with white label solutions for your cloud service you offering to other people, that reveals you are a dumbass trying to be a smartass and not willing to own your solution. Learn to build your solution instead of trying to find white label stuff to repackage and sell – that is the problem with black people, especially those on that MLM and affiliate crap.
I already written an article on membership at http://dreamandhustle.com/2012/11/why-owning-membership-data-has-its-advantages-and-rewards/ and talked about the membership component and we are going to reuse that information here. Yes, in case you didn’t realize Dream and Hustle has covered all of these topics over the years to the African-American community and yall let petty African-American people try to downplay this blog instead of you taking the personal responsibility to use this blog to empower yourself and build you a real empire.
In the diagram above from the last article, I talked about these components of a membership service. In your database and class library, you should create these objects as classes and database tables. I cannot code out the C# and database objects in this article but it should not be hard for you to do – I created code all throughout Dream and Hustle on how to do this – go help yourself to learn Transact-SQL and C# and also go online and find resources to help you code it out – it is not hard.
For the UI, I seriously recommend Bootstrap and WrapBootstrap as a resource. Do not focus on creating any more unique UIs and use the templates. The reason why is UI has gotten more advance and need to do things like automatic resize for mobile devices and large screen computers and these templates already have these functionality in them. Now with ASP.NET MVC, I had a good tutorial article at http://dreamandhustle.com/2014/03/introducing-the-sistas-to-asp-net-mvc-programming/ and those videos is how I learned to pick up ASP.NET MVC quickly.
Here is the overall strategy for ASP.NET MVC development and I will be short and sweet. First, make all the “screens” in a mind map software like FreeMind. Your biggest nodes will be Laundromat Portal then Membership Portal then Operation Portal. Then put the components under each node such as Dashboard, Register, Verify and so on each other the node. Now, if you are advanced in MVC, you want to make sure your URL look like the following:
/Laundromat/View/WashnDry – this is viewing a Laundromat profile for
/Member/View/12345 – this view the account for a member
/Operation/Dashboard/View – this view the dashboard metrics.
That is how you want to structure your controller inside of ASP.NET MVC and in future articles, I will work to code this stuff out in a detailed manner.
Putting It Together
Look for an ACH Processor Service. You want to find an ACH service that allow you to process the direct debit of checking accounts for the monthly subscription. There are services out there but want you want is one that let you access their APIs using REST Calls or a Web Service. Managing transactions is another ownership technology component like membership services that you have to own and know how to work to get your digital empire and money up. Make sure you understand the cost per ACH transaction to put into your revenue model to know your profit margins.
Create the ASP.NET MVC Web Site. You can setup a GoDaddy Windows Hosting Account with SQL Server and if you look at coupon sites, you can find them extremely cheap with a discount code. You will obviously need SSL cert on your web site and just keep the whole web site SSL and HTTPS. You can use Visual Studio Express and I’m using MVC4 that I have moved to GoDaddy and tested and it works fine. Use a template from Wrap Bootstrap to focus on professional UI and create a separate section for the Laundromat, the members and your backend operation. No one should access your backend operation except you. If you are nervous, then create a new subdomain only you know about or create a new web site and connect to the existing database. Also, I expect you to encrypt/decrypt the data in the database using C# to secure your membership information and not be on the news about a data breach.
Mail out Brochures to Laundromats. You look up Laundromats on the Internet and collect a database list of them and collect leads to mail out brochures to tell them to switch to a membership model. You don’t need to show up and hard sell, just mail or drop off a brochure. When they call or check the web site, you give them enough information to explain how the membership model is more profitable then the coin operated model and how easy it is for them to switch and talk to them about the benefits such as increasing working cash flow and revenue and more secure environment of only paid members.
Provide Materials to the Laundromats. Once a Laundromat sign up, it is your best interest to help the Laundromat sign up members are you are charging $4.95 a member. What I would do and what the 3rd Strategic Institute/Swagg-Scientific going to do in the Asian market is provide a USB barcode scanner and the way the USB barcode scanner work is you have a web page that does a JavaScript focus() on a textbox that is hidden. The USB barcode when scan will write text like 1234 and a special character that indicate end of sequence. Your JavaScript should look for that special character and trigger looking up 1234 to see if the member is active or not and return back the status. I hope you followed that. Now the brochures are designed for the Laundromat to pass out to apartment complexes and also we will be creating the account cards and PVC cards (if necessary, extra premium to the Laundromat) to the actual member who sign up.
Manage the Service. Don’t forget that you need to send out e-mail reminders to all parties such as when a new member signs up, alert the Laundromat or when you about to charge a member, alert them a direct debit will happen on a date. Also you need a level of support for questions or concerns or in case things go down. If the service go down, one of the smart programming techniques down the road is to use an offline database that is stored locally on the Laundromat computer and synced with your master database. This list can also be encrypted on their database and you create a software that does the scanning and viewing and sync with your master SQL database.
Oh, in case you wondering about the picture above, that is a QR/barcode scanner and sample PVC cards from our innovation lab that I use with the 3rd Strategic Institute to research solutions for urban areas, including the black community. That means we already tested the membership service with things we gathered over time and tested ourselves this business model. So in order words, me and my crew are probably the only real cats out there doing advance technology research for the hood to help empower the hood while everybody else on some lightweight ish and talking loud like they about something. Damn, it’s hurtful to the lightweights and haters when I can show pictures like this and show we got the materials to prove what we blogging about and we put research and real work behind what we write on this blog.
Making It Happen
In this article, we have shown African-Americans how they can use a $5/month GoDaddy hosting account to create a multi-million digital empire by implementing circular economic solutions in their hoods. You should realize by now that the opportunities for growth in America is in our urban areas and that is what President Obama is trying to preach to yall in 2014. There is no need to be like the cornballs like NewMe and try to impress some punk ass Venture Capitalist bigots and Techcrunch writers – you can build technology solutions for the black community and do for self, your people and your community at the same damn time. And you can easily scale and expand your urban digital solution globally around the world in other urban areas.
African-Americans have to learn the foundational components of a digital empire and in this case study, we talked about the membership component. The basic membership component ask for a username and password but in this example, we showed how that same membership component can be used to manage users in a brick-and-mortar offline solution such as a Laundromat. For too long, Dream and Hustle put this information out for African-Americans and you see how our black people go off and just act ignorant or act like a reading consumer instead of implement any action to empower themselves and those around them.
If someone had moved on this Laundromat service model in the hood, it would have create revenue for black-owned businesses in our hoods which are Laundromats which in turn could have bought washing machines from black-owned appliance stores which in turn are maintained and repaired by black repairman and mechanics who work on these machines. In addition, the number of people walking back and forth from the Laundromat and their apartment would have created an additional flow of economic opportunity by stopping at other stores in the black community along the route to make purchases. Dream and Hustle presented all this information but African-Americans spent more time on trivial crap trying to judge me and this blog, Facebook liking Dr. Farrah Gray social media postings and want to dickride Dr. Claud Anderson videos and complain about economic empowerment instead of doing for themselves and their community.
I hope this case study is taken seriously by brothas and sistas who are trying to do something big for themselves and realize the opportunity and potential out there that does not cost a lot to start up and only has a small learning curve to get over such as learning to code ASP.NET MVC and such. Stop letting these cats tell you who to read and who to follow – Dream and Hustle is the business and we can show and tell we about it for the black community and our people while others cannot. It’s all in this blog, you just have to do the research and connect dots. Learn to build out the frameworks and foundation of a digital empire and the world is yours, starting with learning how to create a membership component.