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Tuesday, June 28, 2022

ENCA: An Acid Test For A Platform To Take Over Niche Markets

ENCA is a Finnish social network that helps people to collect and swap euro coins and other euro numismatics.

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ENCA aims to be the ultimate language agnostic Social Network for coin collectors. It lets its users to swap euro coins in their own language. Say you’re a Parisian coin collector who does not speak (or does not want to speak) any other language. In the future ENCA aims to translate your postings into all the 23 European languages currently spoken in the EU. Out of those 23 languages, currently the service can do only Finnish, French and English and the team is working on German and Spanish. All together ENCA has information on over 1200 coins in it’s database at the moment.

One could argue that ENCA is a combination of Wikipedia, Ebay and Facobook in the world of coin collecting. It achieves to be informative in nature when acting as a Ebay like broker, but at the same time bringing in a Social Network like dimension.

ENCA is coded in PHP on symfony-framework and for database it uses MySQL.

The project was started in late 2006 by an enthusiastic Finnish coin collector, who got the idea when the euro was introduced as a common currency across the chosen EU countries. He played with the idea for years before settling for a social network around coin collecting. Once started he got quickly a strong group of business savvy people involved, namely Jarno Anttalainen (CEO at Syväjohtaminen / DeepLead Ltd.), Taneli Tikka (CEO at RunToShop, COO at Dopplr to name a few) and Ville Karkkolainen (CEO at Triventum). See more on the team here.

ENCA’s business model is three fold:

  1. Premium services for users
  2. A percentage cut from the coins sold via ENCA (yet to set up).
  3. Targeted marketing

The market size for coin collecting is significant. There are about 2 million active euro coin collectors world wide and the value of euro-numismatic market is annually around 2 billion euro. Ebay already by itself has over one million euro items on sale each year with an estimated average price of 20 euro a piece.

Coin collecting market is promising, but the real upside is in multiplying the ENCA model and platform to another niche markets, say stamp collecting, books, wines etc. The same platform will bend easily into a any such Social Network platform by just changing the look to go with the respective niche.

ENCA’s foundation is unusual and different from the way Finnish companies are normally born. As ENCA’s founder did not have much money or assets to back up a major loan, nor did he want to resort to institutions such as Tekes with its high bureacratic hurdles, he needed to figure another way to raise the money. ENCA has altogether 34 investing partners and all of them fall in either Friends, Fools or Family category. One investment might not be more than one or two thousand euro, but all together they add up.

This is a financing model that’s much used for example in Sweden and US and one would hope we’d see more of that in the Nordics and Baltics as well. This model enables one to do a proto of the service or product one wishes to bring to market. The proto makes the idea much more concrete and thus gives the service a lot bigger chance of getting the Business Angels or VC funds interested to further develop the product with the team.

ENCA is just out of Beta and one still needs to have an invitation from a member to join the social network. Regardless, the guys at ENCA were nice enough to give all our readers a possibility to sign up here. Happy coin collecting.

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