Malakyt Unveils It’s Revenue Model
Mihlali Ndamase’s “uber for beauticians” is about to stand the true test of any business — can it make money?
Award winning content creator, influencer and businesswoman Mihlali Ndamase has consistently demonstrated her commitment to dominating the beauty industry at a time when no one can just be a beauty youtuber. After the launch of the “uber for beauticians” — Malakyt — last year it was unclear how the company was planning on making money. This month the company launched it’s subscription service which currently serves as the platform’s only revenue generating model.
From what we know Ndamase is solely at the helm of the company though it is unlikely that the day-to-day operations of the business are handled by someone else. The strategy to launch Malakyt as a free-to-use site for both beautician and client was a smart move to test out the market and see if the operating model of the site would actually work.
How the site operates is a beautician would complete a profile of their services kitted out with pictures, location, pricing and a rating. This was at no cost to the beautician. The customer would come onto the site, input their location and the services they need and voila a list of beauticians offering the service you need right in your area. The exchange of money between customer and beautician would happen outside the site which means Malakyt makes no money from the exchange.
Malakyt also does not run ads on the site so that coupled with them not collecting a cut from the exchange between beautician and customer and no other known means of collecting cash means the company has not made a cent since it’s launch. Granted, the company does not sell a physical product but still incurs costs to run the website and the marketing push for the site seems to have been costly. For almost one year, Ndamase has been funding a project that has made her absolutely no money — up until now.
Recently the site announced that it would start charging a subscription fee for the beautician to be hosted on the site. The official fee is R399 per annum per beautician however the company is currently running a limited special that will allow beauticians to register for R199. There are currently approximately 1 000 beauticians on the site who have a profile. At a price tag of R399 and assuming the same number of beauticians, the company is estimated to make only R400 000 a year. Considering the costs of running the business it is likely that the company will continue to operate at a loss.
Ndamase has been running a very successful personal business so far which largely depends on her having to show up for things. She is about to enter into what is going to be the biggest challenge of her business career which would be to grow the platform to the point where the company is profitable. Although this may take time and will certainly be difficult, it is not impossible. It goes without saying that Ndamase will have to use her capital and clout to get more users in the platform so that more beauticians will be incentivized to register with and pay for the platform. The bigger — and long term — questions is whether she will be able to build a business that can survive without her name attached to it.
It is absolutely normal for any business to continuously make losses while the founders build the business. Ndamase is in a fortunate situation in which she has her other lucrative work which will certainly keep her and the company afloat while the Malakyt team build the subscription base and attempts to turn a profit.
Update:
Following the release of this article, Malakyt released more data about the number of beauticians and customers who use the platform. According to the company, 6008 beauticians are currently on the site and 16 005 customers have used the platform. In the event that all the beauticians stay on the platform at a R399 price tag, the company is expected to generate R2.4 million. Although this number is significantly bigger than the R400 000 estimated earlier in this article it will still be interesting to see if Ndamase can lead the company to a profitable business.
