Bloggers - show me the money

I woke up this morning to find that Matt has already posted his article ahead of the site going live.  Seems like we had a miscommunication.  Arrghh. 

His article is here

Interesting thing though is that a few other bloggers like Fred Wilson and Mathew Ingram beat Matt up about how he didn't run the Alexa, Compete, Comscore analysis on his quote from me that we are bigger than Thisnext.com.

Come one guys.  You all assumed that in talking about being bigger I was talking about traffic.  I was not and frankly don't care to be bigger in eyeballs (eventhough we are).  I care to be bigger in revenue and profits.  This kind of eyeball analysis is so Bubble 1.0-ish. 

When talking about ThisNext I was referring to revenue to revenue. Like.com will exceed $10MM in revenue this year with much of it already in the bag from a run rate perspective. While ThisNext is private and I don't know their exact revenues my understanding is that it is not as large (someone can correct me if I am wrong). In addition, traffic is not a good measure of revenue. For example if Like.com had the same click-through rate as it did a year ago (19%) at 3MM uniques it would have 4.5x less revenue than at 90%. Social shopping sites have had a challenge with this metric - Click through rate. So while they may be close in uniques they may still be far off in revenue. In the end this means that their revenue per visitor is lower.

As a 2nd time entrepreneurs, we at Like.com had decided to not focus on eyeballs or users, but rather revenue and eventually profits.  If you remember we first took this approach back in May of 2006 after we launched Riya (and while we had usage) and didn’t know how we were going to make money.  We retooled and launched Like.com, which we knew would make money.

However, building revenue takes time, but like preparing for the winter it is not something you start when the leaves are falling but something you start many months earlier.  With the economy in recession, I believe that winter will soon arrive to Web 2.0 and those who have revenue and profits will survive, not just those who have eyeballs.

Matt was shown our revenue numbers month by month and my quote refers to revenue.  Saying he didn't run the comscore graph is just plain silly and very bubble oriented.  It is time Web 2.0 companies start focusing on revenue and profits not just traffic.

Comments

[Pranav Chavda]

"It is time Web 2.0 companies start focusing on revenue and profits not just traffic"
Truer words have never been said. True all along since what you called "Bubble 1.0" days.

What's the point of having any traffic at all if a web-based startup isn't going to make any money at the end of the day?.
You don't measure traditional companies in terms of how many people saw their product, but how many of them purchased it, and how that added up to the company's bottomline. Why have a different approach for internet companies?

Not all startups will be or want to get sold out to google or ms for a few billion, some try to build and grow companies, and traffic minus revenues just won't do that.

[James Bruni]

Yeah, Arrington really nailed Wilson in his blog, and rightfully so. Like blows away ThisNext in every respect.

[Brenda Davis]

I like the shoes I buy,but they seem crack after I have walk in the and don't understand why. I buy them all the time and this the first time this has happen.Ijust don't understand why.
thank you
Brenda Davis
605 Coopers Ridge Drive
Kannapolis,N.C. 28083

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