Growth Matters: Redbeacon Sends Batman to the Rescue
Think of it as Google on steroids. Not only can you find the service provider, but you can also sign him up.
The company has two types of customers: consumers looking for a solution to their problem and local services providers who want to solve the problem. Once you describe the service that you need, Redbeacon will give you back a list of profiles of potential service providers along with reviews, comments from other customers, a star rating system from Yelp. It then begins an auction process: competing vendors will bid for your business. You decide which vendor to go with and schedule an appointment online. To make sure that the search results you get back are for contractors that are reliable, Redbeacon lets its users rate the quality of the service they receive from the service provider.
Ingenious? Yes, but the company does face a number of challenges. Among them: service providers trying to fool the system. A local videographer, for example, could attempt to use Redbeacon to crow about his business, bumping up his ratings and signing on more customers. But Ethan Anderson, a former product manager at Google (GOOG) who now works on business strategy, sales and marketing at Redbeacon, insists that the system can't be fooled. "After the job is completed, Redbeacon rates and reviews the service provider," says Anderson. "The system cannot be gamed and we also pull in reviews from Yelp to complement our own."
Sites Powered By Redbeacon
Another challenge, of course, is to get service providers to work with Redbeacon. In order for the online service to succeed, it needs the best service providers -- across all categories -- to quote prices through the system and be willing to share some of their profits with Redbeacon. To make the service compelling, Redbeacon markets itself as a way for service providers to get job leads as well as free advertising. In return, it charges service providers a 10% commission for any job the service provider gets through Redbeacon.
The company plans to expand its service outside of the Bay Area, but it also plans to grow by licensing its technology to sites that consumers are already turning too. So if you regularly go to a website to find an available dog walker, say, you may soon be able to also negotiate the price and place the order. Redbeacon's software will be in the background.
It's still early days for this company, but there is reason to be optimistic. Not only was Redbeacon founded by three former Google product managers and engineers -- Ethan Anderson, Yaron Binur and Aaron Lee -- but it also recently won 2009's TechCrunch 50 award.
The red beacon may be some 50 years old, but it's getting a new life online.