Web 2.0: In Business and Out of Beta

Below is a (very) rough transcript of what was discussed at the MinneBar 2007 panel Web 2.0: In Business and Out of Beta. The panel was supposed to be lead by Aaron Mentele of Electric Pulp, but he had to turn around en route from Sioux Falls, South Dakota because his wife went into labor! Dan Grigsby took over the responsibility for guiding the discussion.

Participants: Dan Grigsby (currently working on a new start up), Bruno Bornsztein (co-founder of Curbly), Matt Thompson (editor of Vita.mn), and Ben Moore (co-founder of Curbly).

NOTE: This is not word-for-word (I can't type that fast). It is paraphrased. Questions from the audience are marked "Q"

DG: What makes web 2.0 different web 1.0?

We can do big projects with less people (example: Curbly -- two guys, two months, no office)

How do you get buzz?

BB: Can launch small, but how do we get noticed?

We hired writers to produce initial content, and then used social news sites like Digg to promote that content.

Q: Do you mark paid content separately?

BB: No. Curbly is a "group magazine". Paid writers create articles, but users can too. [Note: Bruno later added that Curbly's paid writers are listed as "featured authors" -- they're not hiding the fact that they pay people to write.]

DG: There is a difference between paid writers and "astroturfing".

Q: What is Curbly's traffic now? How to monetize/intend to monetize?

BB: Digg traffic is bursty. 50K hits one day, 0 the next. Doesn't affect over-all growth.

Digg establishes your site. Helps with organic search. 70% of Curbly traffic is from organic search

We have 350,000 page views/month and growing. [Bruno later mentioned that the big ad sellers won't even talk to you if you have less than 1,000,000 page views a month.]

Q: Uniques?

BB: 100,000 unique.

MT: Steady growth seems to be a constant across sites. Vita.mn is not talking to a global audience (so they can't promote it on Digg). Our equivalent is when the Star Tribune (Vita.mn's parent site) links to us. Flood of traffic. Some sticks.

BM: Digg doesn't provide a permanent hook. Lifehacker is a great traffic generator for Curbly, because the audience is similar. Finding similar blogs who will link to you is good cheap marketing.

BB: Find out what community exists already. There is a huge DIY community already. It was sasy for us to tie into that.

MT: We're taking something you could do yourself (blog) and making it stupid simple.

It's the distinsion between Application and Publication. The Star Tribune is used to doing publications. Apps have a different investment horizon.

Publication achieves success by being entertaining, timely, andrelevant.

Application achieve success by having people put their stuff in your tool. Your tool powers their publishing.

DG: Let's talk about monetization of a niche.

Example: Guy Kawasaki made $9/day with Google Adwords, but he can charge $75 per job ad -- because he has a self selected audience.

MT: The attention economy. Cliche but sort of true. Attention powers the web 2.0 economy. Vita.mn tries to seize a different slice of attention than the Star Tribune.

Q: What do you think of subscription based sites?

BB: 37 Signals succeeded because they have a ton of attention via their blog. Before you can sell something, people have to find you.

Q: Are people willing to pay for content?

Justin Kruger (audience): MySpace (free) versus online dating sites (not free) offer many of the same features. What are people paying for? Filtering.

MT: You need two things for paid strategy

  1. A wedge -- free version to get people to try your application
  2. A monopoly of a kind. You need a unique application that provides a service that no body else does quite the same way.

Another type of monopoly is a monopoly audience. Dating sites target specific metro regions, for example.

Q: How did Curbly do word of mouth marketing?

BM: We researched top bloggers and contacted them individually. None were interested until we launched.

BB: It was very time consuming. You can't send a bulk email. Gotta personalize it, but it's slow.

BB: We didn't spend any money on marketing. We spend some on contests.

Q: Are you satisfied, or could have done more marketing?

BB: We could have done more, but we're developers.

BM: We maximized leverage. We used the things we didn't have to pay for.

Q: What would you do differently?

BM: I would want a partner with a huge email list (Home Depot for example)

BB: I disagree with Ben. I would buy much more content right off the bat. Content drives traffic. I would pay for more original content, interesting stuff.

When you're just two people, where you spend your time is important.

Q: How important was monetizing Curbly?

BM: We had no monetized strategy at the start.

BB: If you have 50 people working for you, you gotta figure out how to monetize quick. There's less pressure when you're just two people.

BM: We knew we didn't know how to monetize. But we wanted to get it out there. Fail fast. Got first version out in a month.

DG: Development process?

BM: We did the least number of features we thought we could get away with. We knew the site wasn't done. My dad checked out the site a week after we launched in IE and it was all messed up -- we didn't do any cross-browser testing! (before launching)

BB: I wanted to wait longer. But it was good to get it out there. Unless you're 37 Signals, no one is watching you. No one knows when you launch an application.