“Actions Speak Louder Than Words.” We have all heard that saying many times over the years and likely seen it used in during relationships, in a professional setting, with friends…but what about in sports?
Before anything else, please watch this ad featuring Stephen Curry ball handling on an empty basketball court as he reads what others said about him during his 2009 NBA draft. It is inspiring to know that you can beat the odds with determination and perseverance.
CoachUp is a multi-sided platform that connects athletes with private coaches. You simply go to their website, fill out your desired sport, purpose of hiring a coach and then select one from the multitude available. The coaches are listed with their average response time, hourly rate, experience level and user ratings. Please check out a sample here.
Formed in 2011, the Company has raised ~$9.4M to date post Series A. They have recently signed deals with Stephen Curry, NBA 2015 MVP and Golden State Warriors point guard, and Julian Edelman, Super Bowl 2015 winner and Patriots wide receiver and punt returner as endorsements and brand ambassadors. This adds to the 13,000+ coaches nationwide (all 50 states) making it the largest private coaching network. They are passionate about connecting people to help young kids (serious athletes and novices alike) take their skills to the next level. However, this is not just limited to kids. It is also for the tennis mom looking to improve her skills or the basketball player who is past his prime but just wants to improve in the rec league.
Currently pricing is set up with a finder’s fee of $15 and a 6% transaction fee for players that is included in the hourly rate set by coaches in order to continue supporting the community of vetted coaches. On the coaching side, the initial transaction fee is 25% on the first appointment followed by a range of 3-8% on repeat sessions, decreasing based on user’s feedback of coaching. The goal is to allow both sides to stay on the platform. Indirect network effects are in play as the more coaches available the more players are drawn to the platform and the more players there are, the more inclined the best coaches are to join to platform. Coaches are encouraged to stay on the platform with user reviews. The hope is that after a few visits, you find a coach you like and stick with him/her for a multitude of sessions. However, this company’s largest risk is having players and coaches meet on the site and then continue private sessions off the platform in order to avoid transaction fees.
To continue to capture value, CoachUp must scale the player side up as quickly as possible by eliminating future transaction fees but perhaps maintain the small finder’s fee after the second or third private coaching session. In addition, I would encourage CoachUp to offer the first session free or perhaps at a steep discount to ensure you find the coach that you like. The players are what is needed to grow the network while monetizing the payment received from the coaches.