Test prep apps target growing student market

Ashish Rangnekar, co-founder of Lightbank portfolio company Watermelon Express.

Ashish Rangnekar and Ujjwal Gupta, founders of technology company Watermelon Express, said they weren’t trying to make money “ at least not at first.

“When we started, we were just testing the market,” Gupta said. With competition steep for spots at the nation’s top colleges and universities, Gupta and Rangnekar hit upon a growing market for products and services designed to boost applicants’ odds of gaining entrance when they launched their first GMAT app in December 2008.

With little marketing effort, the partners initially sold about 10 apps daily at $10 apiece over a two-month period, Gupta said. The company won the University of Chicago’s New Venture Challenge in 2010 and became a Lightbank portfolio company, operating out of the incubator at Groupon’s headquarters. See SmallBusinessChicago’s related articles on incubators and collaborative workspaces.

“We were able to show them the vision we have to build this social learning platform,” Rangnekar said.

Incubator provides resources

The company did not disclose the amount of the Lightbank investment. But besides capital, Lightbank also  provided access to office space,  utilities and support staff, Gupta said.

Watermelon Express  declined the prize money from the New Venture Challenge when it accepted the Lightbank  investment. With Lightbank’s support, the company is expanding rapidly, the co-owners said.  It had sold about 100,000 apps by December 2010. And as of last month, it  employed six people in Chicago and eight to 10 in  India and Pakistan, Rangnekar said.

Watermelon Express plans to  develop apps for the Android, Kindle, Web browsers and Windows Phone 7, Gupta said. Right now we are focused on building the product and reaching millions and millions of users,” Rangnekar said. “Once we get them, we will take a step back.

— Hallie Busta