In a funny, rapid-fire 4 minutes, Reddit Founder & Entrepreneur Alexis Ohanian tells the real-life fable of one humpback whale’s rise to Web stardom at TedIndia 2009 Event. The lesson of Mister Splashy Pants is a shoo-in classic for meme-makers and marketers in the Facebook age. A great story to show how social media can effect a change in the real World. If you want to watch the video, go ahead.

Alexis Ohanian co-founded Reddit, a social-voting news website with geek allegiances, a small-town feel and a penchant for lighting up the memes your friends IM you about next week. Reddit was founded by Steve Huffman and Alexis Ohanian in 2005, both 22-year-old graduates of the University of Virginia. It received its initial funding from Y Combinator. Condé Nast Publications, owner of Wired, acquired Reddit on October 31, 2006. Ohanian left Reddit in his official capacity in 2009, but continues to be involved with the site’s direction as a sort of godfather, dispensing friendly wisdom (and t-shirts) from his user account, kn0thing. Of late, he’s focusing on Breadpig, a hub for geeky books and merchandise.

Did you know, monkeys have 12 hairs at any one time

I can’t write valuable posts for a long time because of our ongoing projects and my full time job (In fact, there are more than  10 draft posts which i should check and update before I post if i could find enough time and a free brain).  But i try to share valuable resources, especially experiences of successful Internet entrepreneurs with you and this is one of them.

At The Future of Web Apps London, Kevin Rose shares the secrets to Digg and Wefollow‘s explosive user growth. He covers ten unique strategies that turn passive users into passionate advocates and what he did to increase his users to 1,000,000 and beyond.  You can both watch his presentation video or view his presentation slides.

Web 2.0 started as a revolution that uses the web to link people together. Web 2.0 means communicating, sharing, discussing and trading online in very useful ways never possible before. Web 2.0 simplifies collaboration and information exchange. We get used to Web 2.0 services as a part of our daily lives and these services are being more popular day by day.

Web 2.0 makes headlines, but how is it possible to make money by starting a Web 2.0 business? We are sure that there are very successful Web 2.0 companies. Google makes money based on  “free” search,  Facebook and other social networks  grow so quickly and their content is created by their users.

This concise list is prepared to explain what’s different about Web 2.0 and  to help you about how to create a successful Web 2.0 business.

1. A Simple Business Idea: Every succesful business requires a business idea.  The main problem abot business ideas is that people think a complex idea means more success. Most succesful Web businesses focus on simple problems and solve them perfectly. There were search giants before Google but Google improved search results, localized its services with a very-simple interface and for free. Don’t forget, complexity is the enemy of Web 2.0 . Think simple!

2. Create and Release as Early as Possible: The development velocity is important when you start a Web 2.0 business. Investors want to see working prototypes before they invest in your projects and don’t forget the competitors; some of them are experts about getting others valuable ideas and transform into businesses.

3. Use The Network Effect: Web 2.0 World is people-centric and there are countless free ways of collaboration with people who may become your users, investors or team-mates. Social networks and social bookmarking sites likes Digg are the best places to find volunteers for testing your products or advertising your business for free. Listen to your customers and let their feedback shape your product.Try to develop a community around your web business and hire a community manager as soon as possible. Motivated fans will be the best and the cheapest marketing staff of your company. The network effect is the main reason why leading Internet companies got so big, so  fast.

4. Use Web 2.0 Tools To Cut Costs & Save Time:The simple rule to calculate how much money you need for a startup is; ”If you plan to develop in a year, it’s going to take two; if you think it’s going to take $100K, it’s going to take $200K”. So you must find a way to cut your costs and finish your project in due time. Web 2.0 tools help you to complete your tasks in a fast and mostly for free (or at a small charge) way. For example FreshBooks offers a simple invoicing and time tracking services that help you manage your business and lets you . Google Voice gives you anumber for all your phones, voicemail and sms. Especially in the startup phase, online services save you time and money, be available 24/7 and make you look professional.

When developing your products; don’t re-create what you can source from elsewhere. Another website’s API or Google App Engine may reduce your development time. Try to source it from elsewhere before you build something up. If you’re lucky it can be for free but sometimes it’s worth buying a ready solution; your time is priceless.

5. Monetize Every Chance: Advertising can often seem overly commercial especially in the startup stage but a sponsorship or small advertising sections are good for your business to make some money. Every pageview of your web business has potential as an earning point. You can also find innovative ways.

6. Track Your Users & Rankings: Success of your web 2.0 business depends on your business’ statistics. More users mean more money. You must track how man users visit your site, how much time they spend on your site, the most popular and the least popular parts of your site, how much registered users you have and etc… There are plenty of web 2.0 services to track your user analytics and  I think Google Analytics or a similar service is adequate for this purpose. You must also track and evaluate the demographics of your users to understand their needs and level of interests. User registration and polls are good options.
Tracking you site’s ratings is another important thing. Google’s PageRank, Alexa’s Traffic Rank and other rankings show how popular your site is and enables benchmarking of your site’s performance to your competitors’. You must know who’s talking about your company and in what way,too.

7. Don’t Forget Marketing: If developing a good web service is 50% of your business; the other 50% is marketing. Most of the creative & innovative solutions become trash because they can’t become brands. New users mean new markets; having a well-planned market strategy can save your business’ life. Instead of diving into a crowded market like a red ocean full of sharks, look for emerging areas on the web and try to find niche markets.  You should read something about Blue Ocean Strategy to learn niche marketing better. Marketing and brand positioning are two important points that you can need a professional’s help.

8. Read About Successful & Unsuccessful Internet Companies: Experience means money and time. A web entrepreneur must read the success stories of Amazon, Google, Youtube, Yahoo, Digg, Facebook, Myspace, LinkedIn,  PlentyofFish and the others, once. But an internet entrepreneur must read the stories of unsuccessful Internet companies that entered the deadpool, twice.

9. Have a Revenue Model: You can have 10 million pageviews, your users can spend several hours in a day on your site but it’s possible that you earn nothing. Every business needs a revenue model. You can sell physical goods, just run ads or sell your online services. It’s your business and  you will make a decision.  Don’t forget without a revenue model, starting a web business is a business suicide.

10. Continually Improve Your Business and Develop Improvement Metrics: Continuous improvement is the key factor to stay alive in Web 2.0 World; without continuous improvement, Web 2.0 itself can’t stay alive.  Experience is important and failure breeds success. You must learn from your mistakes and not repeat them.
You should define your targets and the KPIs (Key Performance Indicators) to reach your targets. For example, ROI rate is very important if you have investors. Define your metrics and check them often and improve your strategies to improve your business.

This post is a brief of personal experience and inspired by Dion Hinchcliffe’s “50 Essential Strategies For Creating A Successful Web 2.0 Product” article.

]]> http://siteboat.com/creating-a-successful-web-20-business/feed/ 1 http://siteboat.com/google-ventures-is-ready-to-fund-your-startup/ http://siteboat.com/google-ventures-is-ready-to-fund-your-startup/#comments Tue, 31 Mar 2009 19:06:18 +0000 Erdem OZKAN http://siteboat.com/?p=1944

Google finally launched its venture capital fund. Google Ventures welcomes startups from a broad range of industries; including consumer Internet, software, hardware, clean-tech, bio-tech and health care.

The FAQ of Google Ventures tells all the vision and targets of the …

(This post is co-authored with Web2INC Magazine)

The most stressful phase of a business is its start-up phase. If starting a business was easy, everyone would do it! You need 5 things to create a successful business: Idea, Courage, Time, Money, People.

Idea

There are billions of creative ideas in our brains, but ideas mean nothing if you don’t follow up by taking real action. Taking an idea into real action isn’t enough; your business model must cover what customers want. If you’re going to do what everyone is doing, you can’t be successful; you must solve a problem and create additional value for your customers.

Courage

A start-up without any risk is a dream. Forget about failure and  if you think you have a great idea, step out of your comfort area and go for it. Failures breed success!

Time & Money

There is a simple rule to calculate how much time and money you need for s startup: ” If you plan to develop in a year, it’s going to take two; if you think it’s going to take $100K, it’s going to take $200K”. So be patient and spend your money carefully and don’t run out of money. Also, growing too fast sometimes means unnecessary stress of a loan.

People

To succeed, the person you hire must do his job well and be success – oriented. In the start-up phase, the best way to motivate your employees and them make them more efficient is giving them your company’s shares.

You need more people who will help you develop your business for no money. These are friends, candidates for testing your product or service, a friends’ friends at advantageous positions for you to make PR and free marketing. This is called business networking.

To read more about this topic, you should read Paul Graham’s (partner at Y-Combinator) “How to Start a Start-Up” essay on his website. This essay is a must-read resource for entrepreneurs before starting a start-up.

Also, Inc.’s “Start-Up Secrets” slide is worth looking at.

As i mentioned in an old post before, Angelsoft is a New York based company which has become an online ecosystem where investors and entrepreneurs meet to build new companies. Due to its name, Angelsoft was about Angel Investors.After they released version 3.0 , their platform became easier but more powerful. With version 3.4 release, Angelsoft is welcoming VCs into the Angelsoft Network.They’ve launched new power features that can help the venture capitalists streamline the process easier. As it happened in all releases, the interfaces are ipmroved and lots of bugs fixed.

2008 Stats

Angelsoft is an alive and transparent platform and has lots of transactions, so the stats from Angelsoft are reliable enough to represent the industry. I think the most important stat is “invested submissions rate” . As you see, very small number of companies  who apply get funded. This shows how hard being an entrepreneur is. Getting an investment doesn’t mean that you will be successful. The success rate of a startup is very low, too. Half of the startups fail within two years and then the others in the next three years. Average four year – survival rate of a startup is under 40% . There are 442 angel groups and VCs and 14,900 investors in the Angelsoft Ecosystem and Angelsoft processes over 2,100 funding applications a month. Since May 2008, 37,000 + deals made, about 2,000 events occured, 150,000 documents attached.

Doubling Investor Community Activity

One of the most important need of the entrepreneurs is promoting their plans to the investor community. Angelsoft listened to them and took steps to help them out which resulted in a doubling of the number of views that the Investors receive. The feedback form both investors and entrepreneurs have been positive as well which means a win-win situation. Investors now receive an email bi-weekly with the 5 closest and 5 highest rated deals.

Industry Valuations

As the graph at the above shows, the average amount of funds being sought differs between 25% – 35% of the pre-money valuation estimated by entrepreneurs for their companies. The graph also shows us that the valuation is decreasing but the rate of the funds sought is increasing. This means,

• The prices are getting down in the early stage investment industry,
• Entrepreneurs are aready to share more of their companies with the investors.

Conclusion

These new features are a major step forward in improving the funding process for entrepreneurs and investing process for investors. These days, you can see angel investors and VCs coinvesting on deals more often. Both the VCs and angels need each other and this relationship will be more important in the future. It’s a smart action to bring VCs on board and Angelsoft platfrom has become a better place for entrepreneurs and angel investors to be able to meet more people.

* All the data and the images used in this article are the property of Angelsoft.

A startup company is a company with a limited operating history. These companies are the newly created and are in a phase of operational and marketing research & development. They need time, money, customers and most importantly ambitious, stress-resistant and challenger entrepreneurs.

The feeling of starting and growing a new business is unique and inalienable. When starting a business,  an entrepreneur dreams of changing something, achieving success and leave a permanent mark on the world. It’s a really hard task to complete! Every entrepreneur want to grow their businesses in a short time. But the first thing you need is patience. Sometimes many slow & small steps are better for you than fast & big steps. Don’t forget that “cities grow from towns and towns from villages” . Nobody wants to live in a fast-growing but slummy city!

Eric Karjaluoto is the author of the blog ideasonideas and one of the founders of MakeFive. In his “Why Your Web Startup Will Fail” post, he tells the why your startup will fail based upon their MakeFive story. These six titles are cited in this post:

- You won’t have an audience
- You’re going to run out of cash
- You’ll get frustrated
- The emotional rollercoaster will beat you
- You’ll get excited about something else
- But it won’t be because of the competition

This post is worth reading and a must for entrepreneurs to learn the causes to take action for not failing. Internet is an endless source for entrepreneurs to learn from their experiences and their failures. In fact, a failing is the best way for learning not to fail again but it’s the most painful, too. If you value your time and your startup, please read & learn why others fail(ed) and i wish you won’t fail…

An internet business is a business that offers its services and/or products on the Internet. Especially, offering services on the Internet is the preferred subject in this article and on Siteboat.com.

Essentially, every business has a single purpose; to make profit. So an Internet business must be profitable, too. There exists many different ways to make money on the Internet; there are many Internet Business models which are the new forms of traditional business models. Best example for Internet Business form of a traditional business is online advertising. ‘Internet business models’ will be topic of a future post on Siteboat.

The best part of an Internet Business is its Astronomical Market. Worldwide Internet population was 1.1 billion in 2005 and projection for 2010 is 1.8+ billion. More than 60% of population of USA,Canada, UK, Germany, Japan, Sweden, Finland, Singapore and other developed countries with the highest personal income values; are using Internet. And the emerging giants like China, India, Russia, Brasil, Turkey and others have Internet usage rates those double in a year.

The main advantage of the Internet Businesses for customers is to reach your service whenever and wherever they want. Mobility is a strong speciality of the Internet businesses. A traditional business has working hours and available on certain days but an Internet business is online for 24 hours, 365 days.

Getting customer feedback is very necessary for all businesses and the Internet Businesses has several ways to take customer feedbacks online. Market research is easy and customer actions are more measurable for the Internet businesses.

It seems easy to launch and develop an Internet business, but it can be a complicated process for inexperienced newcomers. Nowadays, the Internet business trend is very popular but it’s very competitive and earning money online is a difficult task.

Like the traditional ones, a challenging Internet business need a creative, innovative, marketable and profitable business idea. You can read our ‘Business Development Series’ to manage your business idea creation and business planning process  efficiently.

We will go on this topic on the ‘Internet Business Models’ and ‘Internet Business Development’ posts.