SUCCESS STORY
FixYa.com Brings Social Networking to Consumer Electronics Help

It seemed like a simple enough idea when FixYa.com CEO and founder Yaniv Bensadon sought a solution for consumers caught in the maze of tech support that encompassed nearly every piece of consumer electronics equipment and household appliance on the market.

Why not offer a community-based service, not unlike Google (Nasdaq: GOOG) Forums or eBay (Nasdaq: EBAY), so consumers could find solutions for ailing equipment themselves -- or pay a reasonable fee for professional help?

From that idea, Bensadon formed a list of reasons to start FixYa.com. On the other hand, his why-not list presented a formidable set of problems that might have kept FixYa.com from being successful.

Given the global reach of the Internet, Bensadon did not think starting up his fix-it-yourself-style consumer service from Israel in 2005 would be a problem. After all, he recently relocated there after living in the U.S. for half of the 1990s. He already knew the English-speaking marketplace from his previous entrepreneurial activities.

However, he had trouble finding financing in his homeland. A lack of suitable answer experts in Israel became another problem. It took moving his business back to the the U.S. to solve both of those issues.

"Nobody wanted to invest in the Internet. Most of the venture capital firms were burned from the first bubble. Israel was a great hub for telecommunications and semiconductors and maybe biotech companies; [but] they didn't understand anything -- and maybe still don't -- about consumer business on the Internet," Bensadon told the E-Commerce Times.

Realizing the Need

FixYa.com resulted from Bensadon's own frustrations at getting his array of electronic gear to work after he brought the items to Israel. Trying to find adequate solutions to power conversions and other usage issues consumed too much of his time.

"I had a terrible time getting things converted. I spent a lot of time on the phone late at night to vendor call centers seeking help," he said.

That experience opened a door to what he saw as a great opportunity for a better support model. However, getting from idea to launch -- and then actually getting customers -- turned into yet another maze not unlike his initial tech support woes.

Yet user reaction and the Web site's aggressive growth kept Bensadon's hopes alive. In a little over five months, his user-to-user tech support community grew to 13 million monthly visitors.

Attacking Tech Support

The business model for tech support was the real hurdle Bensadon had to overcome. The cost issues device makers face in sustaining call centers get in the way of quality service to consumers, according to Bensadon. The call center is constantly challenged to reduce costs, forcing manufacturers to migrate their tech support to outsourcing.

As a result, many vendors have gone offshore. Tech support workers are forced to work in an environment of constantly shrinking fees. People hired for minimum wage -- or close to it -- are sometimes not knowledgeable about the products. Their level of expertise often comes mostly from reading off templates, he said.

"Products today are more advanced. Consumers are left frustrated and have to go through hoops to talk to someone because of all the elusive techniques used," said Bensadon.

Enter Plan B

Bensadon set out to end the tech support nightmare with FixYa.com. He envisioned a community-based Web site that maximized Web 2.0 strategies to offer an alternative source of mostly free tech support to consumers.

His goal was to create a place for dialog about very specific user problems. The Web site connects an answer person who already solved the problem with a consumer struggling with the same problem.

"Another consumer is the best person to solve the same problem. The hand-holding component adds [a] source of comfort for users. The answerer keeps the conversation to the issue and does not have to review general background and past problems. They just stay focused on the ask-and-answer process," said Bensadon.

The vision was to combine those two things to create a Mecca for everything consumers need following a purchase. On the value side, FixYa.com would be the place to find tech support information on any consumer product. On the venture side, FixYa would emulate Amazon (Nasdaq: AMZN) and eBay.

Filling a Void

The key to FixYa's appeal, Bensadon reasoned, was the degree of satisfaction between the consumer and the answer provider. That experience is much better than a script-reading tech support person. With that established, marketing concepts can leverage traffic.

He realized that from the vendor's side, no one-stop post-purchase site existed. The existing sites were pre-sale. They all looked to be about price comparison, user reviews, etc.

Consumers, then, faced a void. Once they bought the product, they were on their own to find their way through a massive sea of information to find a remedy.

"We realized that the consumer has no place else to go after the purchase to solve problems. The core of the growth engine is the community of people willing to help and provide information about a product," he said.

Choking Off Challenges

One of the main challenges FixYa.com faced was funding. However, Bensadon tackled that issue with a very lean and aggressive business style. He was good at making the initial seed money last until he had real funding.

He built the basic infrastructure of FixYa.com and generated user traction to the point where he had half a million users per month. For the first two years, he grew that user base with a couple hundred thousand dollars.

"We had to be very scrappy, so we limited hiring to only who was needed. We were very efficient in challenges we defined and executed one at a time. We prioritized them," he noted.

The company employs 30 people full-time, including about 10 engineers for site growth. The business is not labor-intensive on his end, noted Bensadon. The Web site is constantly changing with new features added and old ones modified. Tech support comes from a global pool of community volunteers and fee-sharing experts.

More Choking

Once Bensadon found funding, he had more difficulty finding people with the skills he needed in Israel. So two years ago, he relocated to the U.S.

"Then I had to basically start from scratch as a foreigner in hiring the right people who were going to work together. We overcame this challenge by being very focused and determined. Through trial and error, we [found the] people we needed," he said.

Perhaps FixYa's biggest challenge to survival was finding venture capital stateside. Bensadon attended a few meetings with potential funding firms and left convinced that they did not understand his concept.

"They didn't see the vision, and there was no way they were going to cut a check," he worried.

FixYa Funding

At that point, Bensadon figured he had two options. One was to get to the point where his company broke even. The second was to initiate a very aggressive user growth rate so he could go to Silicon Valley to meet more appreciative investors.

Either way, growing a mostly free service business to either of those goals seemingly defied all odds. However, Bensadon's round of trips to Silicon Valley was successful.

"On my first trip to the Valley, I met with a number of top-tier investors and left with a couple of term sheets. They were very surprised to see my tight operation and how far I got with what I had," he recounted.

Reinventing the Support Wheel

One of FixYa.com's biggest accomplishments was based on setting up a successful new type of user support community. Previously, most community groups were based on a very narrow group of power users, according to Bensadon.

"We broke down the answering experience and made it inviting enough so even the average user was encouraged to participate in the process," he explained.

While most activity on FixYa.com takes place within its free services, the money-making potential lies in satisfied consumers who return for paid help.

Pay as You Go

Consumers can initially go to the Web site to find product solutions from the experience of another user. The consumer does not necessarily need to ask for help.

Consumers can look for solutions among the responses people already made on the same product, or they can post new questions to people who have expressed an interest in helping for free.

For those consumers who need a higher level of professional tech support, a team of more savvy answerers invited into FixYa's paid or affiliate program are available. That service is packaged between US$10 to $20 per incident, payable by credit card for service by live chat or email.

Cue the Best

FixYa.com identifies the best of its volunteer answers based on a rating system. To be declared a category expert, a community volunteer answerer must be very active and answer hundreds of questions with a minimum of 80 percent questioner satisfaction. Those answerers who gain paid professional status share the paid fee on a 50-50 basis, paid monthly from FixYa.com.

"Instead of saying only product experts could qualify, we changed the paradigm so anybody could participate. We nurtured them and motivated them to excel ... so it's not just for novices. There is a path or program for people on the social side who wish to be collaborative. And there is a path for the professional who wants to be more savvy to the point that some of them make [a great deal of] money with us," said Bensadon.

English Only

The Web site's staff schedules the paid answers so that experts in each product category are always available. To remain eligible as an expert, answerers have to maintain a high questioner rating.

The Web site caters most to English-speaking countries. Its user base is 60 percent U.S. and 5 percent Canada, plus 15 percent United Kingdom and 5 percent Australia/New Zealand and South Africa.

"We service predominantly English-speaking countries. We started the site in Israel with a focus on the U.S. market. My previous enterprises were with companies that played in the U.S. market," said Bensadon.

Different Strokes

Despite its innovative approach to tech support, FixYa.com runs a big risk that it will not be able to maintain a paid user base, according to Kurt Scherf, vice president and principal analyst for Parks Associates. That is the challenge faced today by many sites, including very large outfits like Google's YouTube.

"If you give it away for free, why pay for it at all? The conversion, I suspect, would be extremely low going from free-based services to fee-based for this sort of model," Scherf told the E-Commerce Times.

Only time will tell if FixYa.com's method of qualifying experts will work in the long run. What could make or break the deal is FixYa's ability to create a large database of problem solutions by product. Otherwise, some of the other services already on the Internet will have an advantage, Scherf advised.

"This service seems different than some of the others. At its heart it is a social network for getting community-based support. It's not like a paid service that somebody actually has to pay for, but you can," said Scherf.