Savvyroo hops and pivots to a new business model

SavvyRoo cofounder Noah Blumenthal: Less rhetoric, more facts, for a web-focused world.
By GREGORY ZELLER //

If there’s a trope that best suits Savvyroo, it’s “the numbers don’t lie.”

It’s always been the thrust of the startup data-driven digital-education platform, which disseminates the actual facts and figures behind the day’s hottest headlines in fun and easily consumable ways.

Now Savvyroo’s statistical focus has engineered an all-new business model.

Cofounders Noah Blumenthal and Stephen Ostermiller, and SavvyRoo partners Kathleen Reynolds and Alejandro Esquino, were already envisioning different versions of their data digitizer for corporate and university markets. But an eye-opening six months highlighted by what Blumenthal called a “phenomenal” corporate beta test gave them new purpose.

The beta test, conducted last summer, involved 22 employees of Morgans Hotel Group, a New York City-based international hospitality chain. When the results came in last October, Blumenthal noted, Savvyroo staffers were blown away.

Right at the top was the 95 percent of volunteer participants who stuck with Savvyroo throughout the months-long beta run, making recommendations to their bosses on how to improve the company, based on information gleaned through Savvyroo.

That led to the second-most-impressive test result: Company executives identified 60 percent of the recommendations as “valuable to the organization and implementable,” Blumenthal said.

One recommendation would deliver the hospitality chain over $100,000 in annual cost savings; another would create a 1,000 percent return on investment in its first year. Blumenthal wouldn’t discuss the specific recommendations, but said the test results convinced the Savvyroo squad to rethink its commercialization approach.

“It was one of those magical moments you have in business,” he told Innovate LI. “At the time, we were really paying attention to our university product, but those results came in and we said, ‘Whoa, we have to do something about this. There’s clearly market value here.’”

The “other aha moment” involved that university product. It was proving popular at test schools – including Long Island University-Post’s Brookville Campus, where Savvyroo relocated last fall under Start-Up NY – but popularity was a mixed blessing.

It quickly became clear that “well-endowed, wealthier universities” were willing to pay to bring Savvyroo to school, according to Blumenthal, but “less-well-endowed universities weren’t,” creating a moral quandary.

“This really went against the fundamental values of why we created the organization,” Blumenthal noted. “We didn’t want to make a product that contributed to further inequities in the world.”

With the corporate test so successful – and “every indication that it was transferable to other companies” – the path forward became “easy and clear,” Blumenthal noted: Savvyroo would share its educational platforms freely with colleges and universities and make its bones in the corporate world.

“We saw an opportunity on the corporate side to create a really strong business model,” Blumenthal added.

The free school product and the by-subscription corporate product both use the same online learning platform, which includes videos and game-like “tasks” designed to give users deeper understanding of major issues while teaching them about communicating with data.

But where the university platform teaches individual users how to build data skills for job-search and career-development purposes, the organization-focused paid product drives users toward corporate innovation.

“The university product helps them differentiate themselves from other applicants and land really cool jobs,” Blumenthal said. “The corporate product uses the same platform but directs those skills toward examination of the participant’s organization, identifying innovations to improve the company.”

Savvyroo’s “redirection” changed up some earlier release plans: In September, Blumenthal told Innovate LI that as many as 10 companies would run beta tests and that Savvyroo would launch this summer with as many as 50 paying clients, including colleges and universities.

Savvyroo’s experiences with Morgans Hotel Group and 13 test universities rewrote that book. Instead, Savvyroo’s masters spent several months retooling the platform to create “a full market-ready product,” according to Blumenthal, and are now “making our initial push into the marketplace.”

That includes “conversations with several dozen companies about bringing this into their organization,” he added, with the first rollouts expected this summer.

Savvyroo, meanwhile, is still live on those 13 campuses, including LIU-Post, and Blumenthal said he expects the baker’s dozen to renew their annual subscriptions come this fall – and then some.

“Giving it away for free, we expect a large influx over the summer,” he said, noting plans to keep the university platform “100 percent advertising- and corporate sponsorship-free.”

“It’s purely a value-added for the university and its students,” Blumenthal added.

That potential customer base could ultimately be a value-added for Savvyroo as well. The company is banking on word-of-mouth to build momentum as it looks for “early adopters who are inherently innovators at heart,” Blumenthal noted.

“Anytime a new product comes to market, you look for people who get genuinely excited about something different,” he said. “I think as we see success with different organizations in different industries, this will spread.”