story by Kim Souza
ksouza@thecitywire.com
Editor’s note: The City Wire has consulted with people closely affiliated with Northwest Arkansas entrepreneurial programs to compile a list of the five entrepreneurial startups to watch in 2014. Our goal with this effort is to document as much as possible about the ups and downs and other directions a new venture may take as it struggles to prove a product, service or both. Link here for the initial story in the series.
Bringing products to retail has donated the time of two local startups in recent weeks as Ecovet works to fulfill display orders for I.O.Metro and Overwatch reports a successful iOS app for its gaming software.
Josh Moody, CEO of Overwatch, jokes that if he’s seen in the same clothes as a year-ago it’s likely because he has had no to time to change. The 18-year-old Moody has deferred college to devote his efforts to the startup he founded as a high school senior.
Moody told The City Wire the much-anticipated iOS software gaming app launched on the iTunes Store Sept. 8. He said the app garnered 1,000 downloads in the first three days after he unveiled the software at TechCrunch Disrupt in San Francisco Sept. 8-10.
“The trip proved to be far and above what we had hoped for in terms of exposure for Overwatch and gaining interest from a more gaming-focused community,” Moody said. “We were able to glean an 85% conversion rate among those who downloaded the app during that time. To date, we have over 1,300 users from a total of more than 1,600 downloads.”
He said the app was also the No. 12 most downloaded sports and gaming application in the Korean App Store and it ranked in the top 20 sports and gaming app downloads in Japan.
Jeff Amerine, director of Technology Ventures at University of Arkansas, said Overwatch’s invitation to the TechCrunch Disrupt event is a big deal. Moody adds that while in California the startup was featured in interviews by TechCrunch and La Chaine, a prominent French news website. The company also was featured by Engadget.com, all which gives the startup more free publicity in the tech / gaming world.
Amid the TechCrunch preparations, Overwatch also applied for the Adyen Tech Globe Challenge which is a competition that recognizes as the startup with the most global scaleable potential. Out of more than 50 entries, Overwatch advanced to the list of the top eight most scalable startups in attendance.
Moody said the user feedback Overwatch is getting since its iOS launch has been valuable. He said the company will incorporate some changes and a possible new revenue platform into the future Android app launch.
“We are proud of what we were able to achieve in San Francisco, and plan to carry that momentum as we push for our Android release and hardware production in the coming months. We are looking at moving to a subscription model instead of the add-on perk system, based on feedback we are hearing from users and information we learned while in San Francisco,” Moody said.
HARDWARE UPDATE
He said production on the Overwatch hardware pieces — arm mount and rail mount — is slated to begin next week. The hardware is presold on the Overwatch website and could reach online stores within the next four to five months. He said the hardware will not be in U.S. retailer stores in time for Christmas. He expects they will be unveiled in retailers by summer 2015.
Overwatch’s partnership with Cyber Gun has led the way for their products be sold nearly 9,000 U.S. brick and mortar stores including Wal-Mart, Academy and Cabellas.
Moody expects the hardware will retail pieces for $9.99 — arm mount, $14.99 — rail mount. The Apps are free to download with basic operations, for now add-on perks sell for 50 cents each. Under this model, Moody said the average gamer would spend $4 a year. The newly proposed subscription model would allow advertisers to target gamers and provide an unlimited access to the gaming perks, now being sold as add-ons.
He said the company has a projected annual top line revenue of $8.9 million by 2017 as they seek to link 700 million combat video players with 25 million Airsoft, paintball or laser tag players.
“We want to build a social gaming ecosytem around our user base so that our patrons can interact with one another, as opposed to logging on playing a game and then exiting. We have recently revamped our website with a user forum to enhance this social connectivity,” Moody said.
CAPITAL NEEDS
Overwatch is trying to raise $250,000 in capital funding and said they made some good progress in California with local and international investors. Moody said the funds are needed to complete the Android App, bring on another developer and fully market the hardware and software gaming products.
“I have nothing to report as of yet, but we are hoping to secure some financial commitments in the next two weeks,” Moody told The City Wire.
The modest Moody shakes off any notion that he’s a whiz kid, saying only that startup idea etched on a napkin about 18 months ago has gone from being a cool project to something from which he could make a living.
“It has the potential to be big, but I don’t want to get ahead of myself until we are making money. There’s a lot of work left to do and the Overwatch team is dedicated to that mission,” Moody said.
ECOVET DEAL
Ecovet Operations Director Andrew Bogner told The City Wire that the local furniture manufacturing business is growing its local base while also continuing to look at expansions outside the Northwest Arkansas market.
“We have added two new craftsman to the local manufacturing center in Springdale. We have 23 craftsman now working for us and business has picked up behind our partnership with I.O Metro,” Bogner said.
Ecovet takes discarded semi trailers which have pine board floors and strips the floor boards which are then turned into custom furniture pieces by veterans who are also working toward college degrees.
Ecovet has a deal to supply I.O Metro stores around the country with three display items, two of which are already being shown at the Rogers store. The items include an 8-foot dining table, 7-foot dining table and a custom hutch cabinet all made from reclaimed wood.
Bogner said the company has seen some positive results from its exposure on Sam’sClub.com and about half of its business has come by word of mouth from consumers who wanted handcrafted furniture that supports work for veterans.
“We don’t have any Sam’s Club road shows planned at this time as our staff are working hard to fulfill the display orders for I.O Metro. We did purchase new equipment that will help speed up the production process somewhat,” he said.
He said Ecovet continues to look at other national regions for possible manufacturing sites, places like the Northeast were there is an abundance of old trailers and veterans looking for work.
Bogner said most of the company’s sales have originated in the local area, but they are hoping the national exposure with I.O Metro will give them a broader audience. He said one of the best sellers in recent weeks has been custom conference tables ordered by company’s who support Ecovet’s core mission.