Please meet Lit-Era and it’s co-founder Sergiy Grushko. Lit-Era is a platform for both, readers and writers to unite. We met this startup at our Startup Lithuania‘s Roadshow/Pitch Battle in Kyiv, Ukraine few weeks ago and you will have a chance to see them at LOGIN Startup Fair this month as Lit-Era will attend the event!

We wanted to hear more about this Kyiv-based startup, so we asked its co-founder Sergiy to introduce their product and he kindly agreed. Take a look:

Hello Sergiy! Please introduce your company for our reader – what is Lit-Era? How it works? What were the reasons behind coming up with this idea and launching this product?

Sergiy: Lit-Era is a literal marketplace which is transforming into the social network. Traditionally social network became a place of sales for users but we move as we move. The idea was simple – to use bonuses of crowdpublishing for the monetization. You write a novel and publish it part-by-part. You add a new part of a novel even the next minute as it is written. And readers follow your book, comment it, discuss new episodes. It’s a real fun for readers and for writers but this fun doesn’t bring money for writers so it’s a fun for non-professional authors. We decided to combine money and fun. We gave the writer possibility to sell the book which is still in process of publishing. If a reader wants to follow new parts he has to pay. Single payment for the whole book as you buy the ready e-book in the store. The only difference that you have to wait for a new episode but you read the book as the absolutely first reader. We name these sales as "subscription".

When exactly did you launch, what were the main challenges before launching?

Sergiy: My partner Andrii (he is a writer) and I have co-operated for 10 years. We had the different project but the idea of Lit-era appeared a bit less than three years ago as a result of operating our common site about literature fantasy and science-fiction called fan-book.ru. We’ve launched lit-era.com on July 28, 2015. The main challenge was to develop the platform as we see it. We are not programmers so hiring an exact developer is the main challenge. We are still developing a platform that is why we have Russian version only. One version gives us an opportunity to prepare service for worldwide expansion when marketing and sales will take much more attention than product development.

What are your target customers?

Sergiy: Writers and readers. Fans of reading. The audience of those who reads books everyday is not so huge as who is a fan of mobile games. Moreover, they don’t share with colleagues or neighbors about such hobby as a reading. Maybe your boss reads five or ten books per month and he/she is a fan of romantic fantasy or post-apocalyptic thrillers. You don’t know this. But they are. There are millions of people who read dozens of novels per month. They look for them on the Internet because paper books need the real bookshelves in your house. So you use a library near your home or the Internet. Most of them are single in their interests in real life. So we give them socializing with people with the same interests. That is the reason why 5K comments for a book is not something extraordinary.

Look how many debates popular book has our customers live on the site. Our user pays more than one hour per day for our service. Not only reading. Visitors and especially authors like to talk in blogs.

How has business been so far?

Sergiy: We operate only Russian version so we are still far from unicorn’s level.  But we reached a level of 100K daily users and $100K of monthly sales. The growth for the half a year was 300% in sales and 150% of the audience. What’s interesting is that we sell better than traditional e-book stores. Last year the leader of Russian (~65% of e-book market) market announced that the best sales of the first day were 3000 thousand of sold e-book copies of new book of Victor Pelevin. Our record was 1050 copies sold per the first day (August 2016). But we had 1,5% of market share, and it was a new book of Victoria Svobodina whose first paper book was published in November 2016. New writer vs. Top writer. 1000 copies vs. 3000 copies. It showed that our model worked better.

Future plans, ambitions? Simply speaking – what's next?

Sergiy: First of all this year, we plan to launch new language versions. We plan to start from Ukrainian, Turkish and Polish. All these markets totally differ from Russian and each other. But they are portraits of kinds of publishing markets as we see them. After that, it will be much easier to plan our worldwide directions. Another vector of development is a launch of the publisher account. Now it is on the stage of testing. Publisher starts to publish new novel part-by-part before the paper release and finish after the release. So the first e-book sales are protected from piracy and publisher may do pre-launch advertising with a place for readers where they may read a teaser (if they don’t want to subscribe). We want to sell e-books a step before traditional e-book store does. We want to take the tastiest piece of pie from Amazon and other bookstores – the e-book sales of the first month. It’s hard but we will try.

Main challenges while working on this product and how are you overcoming them?

Sergiy: The main challenge of any marketplace is the problem of egg and chicken. Users want to see many products as sellers want to see many users. For literary platform case of engaging readers and writers is even more complicated. I think that understanding “how it works” is our main competence. So we believe we may use it penetrating to the new language markets.

How are you funded?

Sergiy: The launch was funded by co-founders. This is the easiest way to test your idea. In the summer of 2016 when we became profitable we get the first funding from the angel investor of $50K. We planned to invest extra money in marketing and growth so decided to have ‘a financial insurance’ if our plan would be optimistic. But marketing brought more readers and more sales so we are still profitable. And now we are interested in the round not less than $500K for launching English, German or Spanish language version this year. These markets are more expensive for penetration and we need extra funding for marketing and local sales team.

What do you expect at LOGIN Startup Fair? 🙂

Sergiy: We want to win startup battle and to look on Lithuanian startup ecosystem closer. We have some plans connected with Vilnius but it's early to talk about them.

Thanks for your time, Sergiy! See you really soon at LOGIN Startup Fair in Vilnius!