YC Demo day happened last week, and one of their companies soudned eerily familiar to Leetchi’s social payment platform “Crowdtilt is changing the way we pool funds with friends.” – Looks like the race is on.
A few weeks ago we reported that Leetchi raised €4 Million to expand their French social payment platform to the UK and Germany; meanwhile, after YCombinator’s always much-anticipated demo day this past week, all of the tech news has been focusing on which of YC startups are a ‘must-watch.’ We’ve got a Path for couples, a Kinect via webcam, and even someone disrupting the construction space (hardhats for iPads?), but French startupers might be most attracted to Crowdtilt: “Crowdtilt is changing the way we pool funds with friends.” This may sound familiar- probably because it’s exactly what Leetchi has been doing for a few years.
So it begins. Again.
While Leetchi’s was founded two years before Crowdtilt, according to Crunchbase, we all know well enough that this has not been enough for a French company to outplay its American competitor in the past. How is Viadeo fairing in compared to Linkedin? How much did YouTube sell to Google vs. how much DailyMotion (which started two weeks earlier!) sell to Orange? The trend has not been favorable toward French companies going up against American ones with traction and press – but I think we’re in a new era for France, and it doesn’t need to be that way.
I hear you mumbling to yourself behind your Macbook Air “But why can’t both of them exist?” Given that Leetchi has made the bid to go European with this most recent round of funding, there’s no way they will content themselves to say European and wait for the American giant to raise enough money to crush them – to misquote The Western Code “This world ain’t big enough for two social payment startups.” If they weren’t already, now is the time for Leetchi to go heads down stop taking weekends – oh, and don’t you dare take a two week vacation in August.
Never underestimate a YC company’s traction.
What’s that you say? “But they’re only a YC company, they’re not even well adopted across the US. There’s plenty of time” How long do you think it will take for Kickstarter to buy them up and implement them internationally? Or what is Google wants to get into crowdfunding? The barrier to entry is high, but the barrier to buying into entry is lower, and there now exists a very attractive option for Kickstarter, Paypal, Square, or whoever to buy into the market, with all the traction and fame that goes along with a YC company. Being first is not enough when the second place player has the option of being bought into a company with a much larger budget. Don’t expect La Poste to be buying up Leetchi anytime soon.
The history is not yet written, but I foresee Crowdtilt appearing in the US Tech press a lot in the next few months (raising a fund, launching new features, superbowl advertisement, etc.). Ultimately, it will depend on who can execute well, who understands users’ needs more, and who can be agile enough. If you don’t agree, just ask Dailymotion or Viadeo.