Archive for the ‘Business Models’ Category

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Scaling Versus Scoring

September 6, 2007

Jason Calacanis has a very interesting new post up that talks about the tension between building out infrastructure to scale a business and introducing features that make people want to use your product/service in the first place.  Calacanis discusses it as the CEO wanting to announce cool new stuff while the CTO is not sure the infrastructure can handle the crush of people wanting to use the new feature—he uses Twitter as a possible example.

But I think this could be a post about the tension in general when you run a business—how much you promise vs. what you can deliver right now.  On the tech side, the question is whether your software/hardware will hold up.  But think about very non-techie businesses and a similar theme emerges. For example, a small ad agency pitches a big client, gets the work and quickly realizes it doesn’t have enough people to do the job.  In addition to the problem of finding the people,  there will be the issue of paying them, as the new project might promise mounds of money in the future, but will completely drain cash flow today. From the outside you see an agency that just landed a big client and is going places. From the inside you see an agency that might go broke before it ever gets the work done that would catapult it to a higher level of success.

It’s sort of the classic entrepreneurial bootstrap story—overpromise and then stress out on how to deliver. If you deliver, you get the rewards. If you don’t deliver, you’ve disappointed users/clients, and you might destroy your reputation before you even have one.

One thing I’ve always enjoyed about being my own boss is that I no longer feel that dread on Sunday night that I have to work the next day.  I think the entrepreneurial tension is something that drives you to want to work, because it’s an exciting challenge, even if it’s more stress than might be healthy.

e-mail me: adam@bessed.com

Adam Jusko is founder and CEO of Bessed, a Web site promising “search without spam”, thanks to human-edited search results and ongoing visitor feedback. Do a search, offer your comments, submit your site–help create the “bessed” search site in the world.

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Disney and the Details

April 26, 2007

My family went to Disney World as part of our spring break vacation.  I don’t particularly buy the whole “magic” of Disney—it’s an interesting enough place, an impressive business success, but I didn’t spend a lot of time oohing and aahing over anything.  Granted, my kids’ ages kept us completely in the Magic Kingdom, so I can’t speak to the place as a whole, and I did LOVE the Mickey’s Philharmagic 3-D movie. If you’ve never quite understood the hubbub over 3-D, that movie will show you, and I hear Disney has other 3-D movies in other parks that are pretty awesome too.

Anyway, since I wasn’t so taken with the magic of Disney, why am I wasting time writing about them? Because I was particulary impressed with one aspect of Disney, and it illustrated why parents shell out the big bucks to bring their kids there.

My son has certain food allergies that are often difficult to explain to restaurant waiters & waitresses. They don’t understand why his hamburger can’t touch the bun, for example. They’ll come to the table with the hamburger on the bun and when we tell them he can’t have it (which we already made clear when ordering), they often think they can just take the burger off the bun and everything’s hunky-dory, not understanding that the contamination has already occurred.

When we sat down at a Disney restaurant and looked over the menu to see what would be OK, a waiter came to our table. We explained our son has allergies, and he immediately said “I’ll have the chef come talk to you.”  Which is exactly what happened.  The chef showed up, made sure he understood the issues, offered some suggestions on dishes they could prepare that weren’t shown on the menu, and even came back a second time with a box to show us a gluten-free product we’d never heard of. It felt great to be taken care of, to not have to worry whether the food coming out was going to be OK.  And it also gave us a more nutritional option for our son than we usually have when eating out.

So, while I may not admire the magic, I admire the attention to detail.  And I understand why Disney succeeds in getting people to return repeatedly. It’s often the little things that make people return to you for business, and I think this one is a great example.

e-mail me: adam@bessed.com

Adam Jusko is founder and CEO of Bessed, a Web site promising “search without spam”, thanks to human-edited search results and ongoing visitor feedback. Do a search, offer your comments, submit your site–help create the “bessed” search site in the world.

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Looking for Cash, and How to Grow in the Meantime

March 8, 2007

In an ideal world, Bessed would grow its human-powered search engine as follows: hire roughly 80-100 editors who churn out more and more search results pages each day in order to reach a critical mass that makes Bessed a trusted resource for the vast majority of searches that people do.  (To reach that critical mass would take about three years by my  estimates.)

One of the great things about having this many editors devoted to search would be that Bessed could be timely on searches that change often due to frequent news, while also fleshing out the “long tail” of searches—those thousands of searches done each day on topics/companies/people that do not need frequent updates.  The combination of the two would create a tremendous mass of search results that are spam-free, timely, and accurate.

Unfortunately, to do it right requires a lot of money, much more than we have.  And my casual talks with investor types thus far have basically led to the same conclusion—no money until you show some traction, meaning a certain traffic and/or revenue level.  This is especially true in that Bessed does not have a management team with a home run under its belt.  Hit a home run and investors are more likely to back you next time, because, of course, they’ve seen you hit a home run.

So, toward that end, we at Bessed are going to shift our focus a bit.  Instead of trying to be all Bessed could be if done on a wider scale, we are going to focus on the reality of what we can actually accomplish on a smaller scale, with the intention of going bigger once we’ve proven ourselves.

How does that play out?  Less of a focus on timely events.  Less focus on entertainment, politics, etc. and more focus on the long search of what people actually “need.”  In other words, you might “want” to read about Britney Spears, but you “need” information on finding a job or what the explanation might be for that pain in your left ear.

We are going to spend much less time on updating the daily ephemeral “events” and more time on the timeless searches that mean long-term traffic and, most important, higher revenue potential. We need to show more progress on a small scale, and I believe this is the way to accomplish that. We’ll see how it goes.

e-mail me: adam@bessed.com

Adam Jusko is founder and CEO of Bessed, a Web site promising “search without spam”, thanks to human-edited search results and ongoing visitor feedback. Do a search, offer your comments, submit your site–help create the “bessed” search site in the world.

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Ask the Wizard

February 20, 2007

I’ve already forgotten where I read about it, but I found the blog of Dick Costello, the founder of FeedBurner (which does something with blog feeds), and it’s really good. It’s especially good if you are a startup trying to understand the whole angel/venture capital game, so take a look if that’s you.

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Zink – A Life Changer?

February 7, 2007

Most new ideas are small, incremental steps forward, or built for a limited audience. This is especially true of many of the Web 2.0 stuff being launched these days, most no more than “widgets” that a relatively small band of hardcore techies have interest in.

Zink is different.

Zink stands for “zero ink.” It lets you print color digital images without ink cartridges or ribbons.

Here’s how it works: Zink is really a special paper that has dye crystals embedded into it. The printer then heats up the paper in a way that it brings out the colors in the shape of the images on your photo. You have to buy the Zink paper for it to work and I think you need a special printer that is compatible with the paper.

This isn’t all ready for you to go out and use, but the point is the technology is there. Now it’s just a matter of getting it into the market. And there’s absolutely no doubt that people want printers that don’t force you to continually buy ink—everyone knows that’s where the real cost of printing lies.

I have no idea about the quality of the Zink images. It might suck. But, even if it does, if the technology has reached this point, it will continue to be refined until it’s the standard. So, no more ink for printing your photos.

Now, when are they going to make this happen for my document printer?

e-mail me: adam@bessed.com

Adam Jusko is founder and CEO of Bessed, a Web site promising “search without spam”, thanks to human-edited search results and ongoing visitor feedback. Do a search, offer your comments, submit your site–help create the “bessed” search site in the world.

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GoodStorm’s MeCommerce

January 29, 2007

In thinking about the business model for Bessed, I’ve been considering alternative revenue sources in addition to advertising. One of the things I’ve been thinking about is teaming with retailers and doing the affiliate-type situation in which ads are placed and you’re only paid if a click-through results in a direct sale. I’m not a fan of doing this, but the strict ad model is somewhat difficult, so I’ve been thinking that if a partnership presented itself that would result in a decent enough cut of sales, it could be worthwhile.

I read today on TechCrunch about GoodStorm’s new service which is actually not relevant to us, but the post did lead to a mention of their earlier announced service MeCommerce.

To some extent MeCommerce is just like those Amazon ads you see left and right on content sites, but the promise is that you would get paid a greater percentage of the sale—half of the profit on each item, although I don’t know exactly what the profit itself is in order to figure that. Regardless, I’m assuming it would be a better % than Amazon.

In addition, MeCommerce is supposed to let visitors buy an item without leaving your site, which is neat.

So I signed up today to test it out and see if it might be worth exploring.

I couldn’t get anything to work. It told me that I could zero in on keywords that would then produce products suited to those keywords, but when I put in the keywords, it told me there were no results. Even for the keywords that they themselves suggested as possibilities, I got no results. I was using Firefox—is it maybe an IE product only?

All I know is, it didn’t inspire confidence. I would want the revenue share, but also greater reliability. Maybe someone from GoodStorm will see this and give me a heads-up on what I was doing wrong. For now, though, it doesn’t seem to be an option.

e-mail me: adam@bessed.com

Adam Jusko is founder and CEO of Bessed, a Web site promising “search without spam”, thanks to human-edited search results and ongoing visitor feedback. Do a search, offer your comments, submit your site–help create the “bessed” search site in the world.

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Making It Relevant

January 22, 2007

Seth Godin, who I link to often enough that I’m entering stalker territory, has a post that’s simple yet worth remembering, titled Who Wants a Prize Like That? The basic message is that in promoting your work it makes sense to market in a way that is relevant to your target audience—in his example, the Thriller Readers Newsletter has a sweepstakes to win 150 “thriller” books signed by their authors if you sign up for their newsletter. Not cash, not an iPod, but a prize that that particular audience would crave.

There’s nothing colossal about that point, but it’s still worth noting.

Of course some businesses lend themselves to this point better than others. If you sell snowboards, it’s not hard to figure out what some relevant marketing angles might be. You think about what snowboarders might be interested in and follow the trail, so to speak.

But use that same logic for auto insurance—if you sell auto insurance, go where the drivers go? Hmmm… driving isn’t exactly a niche activity. Everyone needs auto insurance, but no one likes it and it’s not like marketing to auto enthusiasts would really be targeting your audience. Car enthusiasts like driving, not buying insurance in case of an accident. They want sleek design, not an insurance statement.

So what could companies that serve a general interest (or necessity) do to stand out, to be relevant? That’s a tougher question. Maybe they target their most profitable potential customers first? For instance, would Allstate or Progressive be wise to target Mommy drivers who are less likely to drive recklessly by offering free car seats to new Moms if they choose their particular insurance? That’s one way to go about it. Find out who are generally your most profitable or most loyal customers and target them first, with advertising or giveaways relevant to them. Do this in a few niches and your big general-interest business can be relevant in your most important customer markets.

By the way I have no idea if mommies are really safer drivers than anyone else, just guessing.

What can your company do to market relevantly to your potential customers? (By the way I have no idea if “relevantly” is a word.)

e-mail me: adam@bessed.com

Adam Jusko is founder and CEO of Bessed, a Web site promising “search without spam”, thanks to human-edited search results and ongoing visitor feedback. Do a search, offer your comments, submit your site–help create the “bessed” search site in the world.