Equestrian App Pitch: Ride IQ Overview

Sep 24, 2024

Lecture Notes: Day Two Pitch - Equine Sports and Ride IQ

Introduction

  • Host: Josh Muccio
  • Venture Capitalists: Beck Bamger, Al Basher, Jillian Manis, Hoe Diamond
  • Featured Startup: Ride IQ
  • Concept: An auditory coaching app for equestrians, similar to Pelaton or Strava but for horseback riding.

Market Overview

  • Equestrian Market:
    • Smaller compared to running or cycling.
    • Requires significant commitment (buying a horse, coaching, stabling).
    • Potentially profitable due to passionate riders.
    • Estimated 8 million equestrians globally.
  • Running Market:
    • Larger, low entry barrier (anyone can run).

Ride IQ Overview

  • Founders: Keny and Jessa Lux, sisters and equestrians.
  • Background:
    • Keny: Senior investment associate at Blackstone, equestrian gold medalist.
    • Jessa: Marketing and community building.
  • Product:
    • Mobile app delivering on-demand audio lessons by top coaches.
    • Offers guidance for solo rides, aiming to enhance productivity.
  • Launch & Growth:
    • Launched in August 2021.
    • Over 1,500 paying members and $430,000 in ARR.

Business Model

  • Subscription Fee: $30/month.
  • Total Addressable Market (TAM):
    • Initial equestrian focus: $3 billion.
    • Potential expansion: TAM over $20 billion.
  • Funding: Seeking $1.5 million investment.

Investor Feedback

  • Jillian Manis: Interested, sees potential.
  • Hoe Diamond & Beck Bamger: Cautious, concerned about scalability beyond equestrian market.
  • Al Basher: Interested and willing to invest $50K.

Product Details

  • Content Delivery:
    • Audio lessons recorded by top equestrian athletes, including Olympic medalists.
    • Proven effectiveness during rides, offering focused guidance without visual distractions.
    • Expansion plan includes video support.
  • Coach Recruitment:
    • Coaches are highly qualified, often top athletes themselves.
    • Payment: $100 per lesson.

Market and Expansion Strategy

  • Current focus on equestrian market.
  • Potential for expansion into other sports (e.g., golf, skiing) and activities (e.g., photography).
  • Challenges:
    • Retention: 12-month retention rate at 42% (compared to 21% median for subscription apps).
    • Requires careful navigation to ensure successful entry into new markets.

Investment and Valuation

  • Current Valuation Proposal: $10 million (viewed as high by investors).
  • Investor Offers:
    • Jillian Manis and Al Basher expressed conditional interest.
    • Agreed to continue discussions at a valuation closer to $6 million.

Conclusion

  • Investor Sentiment: Mixed feelings; strong belief in equestrian market but concern over ambitious valuation and cross-vertical expansion capabilities.
  • Final Outcome: Kinsey and Jessa have commitments from investors but need to negotiate valuation.
  • Next Steps: Finalizing terms and potentially expanding beyond equestrian market after consolidating current growth.

Additional Context

  • Passionate User Base: Several customers have shown extreme loyalty, even getting tattoos related to Ride IQ.
  • Potential Risks and Rewards: Strong market niche but requires strategic scaling to other sports markets.

Key Takeaways

  • Focus on Core Market: Deep understanding and initial success in equestrian market.
  • Scaling Strategy: Importance of a methodical approach to diversification.
  • Team and Vision: Founders' personal insight and connection to the market are key strengths.