Saturday, June 14, 2008

Stages of Web 2.0 startups

Stacey Higginbotham at GigaOM has an amusing post, "The 5 Stages of a Consumer Web Startup".

Some excerpts:
One day an entrepreneur ... gets an idea ... and starts coding. A few weeks or possibly days, a beta -- increasingly a euphemism for a not-fully-thought-out-product -- emerges.

The buzz builds ... the entrepreneur rejoices. The VCs ... do a fly-by ... Eight weeks later reality sets in. The traffic stops growing or -- worse yet -- dives ... But as an ever-optimistic entrepreneur it's time to regroup, gather your programmers, toss back some Red Bull and ... launch a social network widget.

[Then] it's time for the big guns ... the open API. Now you're a platform! The startup ... founder rejoices again ... The money men get serious because ... [now] you have a Facebook strategy.

[Twelve] months later ... it's time for advertising .... But selling online advertising is hard ... It's time to consider reality. You could always try your hand as an ad network or merge with a competitor, but more than likely it's time to sell that domain name and user base on eBay or quietly shut your doors. Better luck next time.
I am embarrassed to say, Findory had a beta, widgets, an open API, and a failed attempt in online advertising. No Red Bull though.

Please see also the Underpants Gnomes' business plan.

1 comment:

Abhishek Gattani said...

Greatly put! Google's strategy is to build products which people need and use, and later figure out a way to monetize. However, it easy for Google to do this because they already have a huge ad platform to leverage from. So much so that Yahoo is using them to monetize better! Unfortunately, the trend for most web 2.0 start-ups is to aim for a user base and ignore how money will be made. The fundamentals of starting any business.