Search for a business model Matt 20 Apr 2005

19 comments Latest by Dave

Del.icio.us’ Joshua Schachter accepted an investment from a group of big names. How do they expect to make money off del.icio.us? Well, they’re not quite sure yet. Here’s the take from a VC at Union Square Ventures, one of the investors.

The question everyone asks is “what is the business model”. To be completely and totally honest, we don’t yet know. This was a seed investment and none of the investors put up very much capital. Joshua retained complete control of the service and is going to focus on making it better. That is all anyone wants to see happen right now. In time it will become clear what the business model should be. And there are a number of them to choose from for sure.

19 comments (comments are closed)

JD 20 Apr 05

With all respect to Joshua, I think that delicious is more or less done. I love it for the fact that it is so simple. Only one thing I would like to see is better API support so that other developer can create wonderful stuff.

This investment is going to force Joshua do something which he doesn’t want but has to do because Investors would want to get their money back. It will be interesting to see what future holds for delicious.

JD

Adam Michela 20 Apr 05

Gotta agree with JD. There is not much more that SHOULD be done to del.icio.us.

What’s great about it is what it’s not.

The money should be used to improve response times and api support/reliability.

Obviously though, that won’t work when the whole point now is to make money off it. Which is fine. Hopefully they can make some money and still keep the core substance of del.icio.us in tact.

Ryan Schroeder 20 Apr 05

well, their two stated objectives are hardware upgrades (to address scaling/popularity issues) and ease of use, not new features.

Mike D. 20 Apr 05

Agreed that there isn’t a ton of more value that can be added from a *bookmarker’s* perspective, but maybe that’s not the plan. If it were me, I’d continue to offer del.icio.us as a free bookmarking service but then use the publicness of the information as a way to gauge trends and popularity. For instance, if I want to see what the best webpages are currently that relate to kites, I can search for the kite tag and then the most bookmarked pages come up. Then, I can insert ads into those pages.

It’s more or less exactly like Google except instead of ranking pages by how many people link to them, you’re ranking by how many people explictly bookmark them.

Anon_User 20 Apr 05

This is a joke. You can’t apply a business model to this. To even think so is preposterous. To even ask “what is the business model is doubly preposterous and troublesome.

I’ll tell you what will happen: This is going to be developed further until Yahoo or Google “notice it” (I speak loosely here, because “notice” is relative to “when the 1 sole employee develops it enough so that we can consume it whole for a fraction of a penny on the dollar”) and it will be bought by one of them.

They will then add it as another feature of their products. Finally, angels and current shareholders will take their piece of the pie of easy money after “exit” — if you really can call it that. *lol*

This “Web 2.0” phenomenon risks the same irrational exhubrance by people thinking you can tack a business model onto anything that has the word “social” in it.

But, those VCs are smart. They’ll get a quick return on something that’ll be gobbled up by one of the 800 lb. gorillas. Can’t blame them — I would love a 200% return, too.

JF 20 Apr 05

This is a joke. You can�t apply a business model to this… I�ll tell you what will happen: This is going to be developed further until Yahoo or Google �notice it� (I speak loosely here, because �notice� is relative to �when the 1 sole employee develops it enough so that we can consume it whole for a fraction of a penny on the dollar�) and it will be bought by one of them.

Maybe that’s the business model.

Darrel 20 Apr 05

Delicious is great, but at the same time, it’s simplicity is its problem. It’s incredibly easy to clone the actual functionality…del.irio.us’s open source version, Spurl.net’s version (my current favorite) and many more to come, I’m sure.

Personally, I’ve just been using Firefox’s own bookmarks as my own personal del.icil.us I no longer organize my bookmarks, but just key in a few keywords everytime I bookmark a page and use the search bar to find everything. So much quicker than any of the online options IMHO (though I am using Spurl more and more often now…)

Konstantinos 20 Apr 05

Well, I see your comments about del.icio.us being more or less done, but, on the other side, I believe it could benefit from some AJAX treatment.

For example, wouldn’t it be nice if you clicked the ‘Edit’ link and the respective input fields came up instantaneously? Or you could manage ‘tag bundles’ with ‘+’ and ‘-’ next to each tag.

James 20 Apr 05

“Delicious is great, but at the same time, it�s simplicity is its problem. It�s incredibly easy to clone the actual functionality�del.irio.us�s open source version, Spurl.net�s version (my current favorite) and many more to come, I�m sure.”

Yes, but delicious has the data. The site works best because it has reached a point of critcal mass (or whaterver the term is). So it is quite handy for tracking trends, seeing related topics (what will be hot next), forecasting site growth, and other marketing tidbits.

Delicious needs to sell marketing reports. (Well, that and invent additonal for-pay services.)

Hrush 21 Apr 05

Wow! As someone who is currently struggling to get a very tangible business model funded currently, hats off to Joshua and good luck…

I think it’s great that there are people and insitutions who are willing to back early stage ideas with money — everyone we’ve talked to constantly says “Hey, great idea and we think the market is ripe and blah blah, but we don’t provide startup financing.”

I’m sure there are many ways for delicious to make money and we’ll soon find out about what this elusive business model is anyway…

Gene 21 Apr 05

I’m reading some seriously sour grapes types comments here…

Why is it that when one of our own comes up with a good idea, puts a shitload of sweat equity in their idea and actually get someone to give them cash for it, we all get jealous and angry and attack that. I say that’s beautiful and Joshua do it as many times as you can bro!

Trish 21 Apr 05

Yay, it’s 1999 all over again!

Darrel 21 Apr 05

Yes, but delicious has the data. The site works best because it has reached a point of critcal mass (or whaterver the term is). So it is quite handy for tracking trends

Is it? Del.icio.us seems targetted squarely at the blog community. So, any ‘trend’ is going to a) be targetted at a rather narrow demographic and b) highly swayed by the simple fact that the blog community, in itself, hypes each other.

For instance, even without del.icio.us, a few key bookmarks would make the rounds within a week across dozens of blogs. Doesn’t necessarily mean that that particular page MEANS. Though it does mean bloggers tend to ‘network’ their links together fairly quickly.

we all get jealous and angry and attack that

Which thread are you reading?

Darrel 21 Apr 05

Oops. meant to say…

Getting placed on Del.icio.us doesn’t necesasrily mean your site is trend-worthy, just link-worthy for that brief moment in time when bloggers had nothing to write so they just duplicated link pointers. ;o)

Gene 21 Apr 05

- This is a joke. You can�t apply a business model to this. To even think so is preposterous. To even ask �what is the business model is doubly preposterous and troublesome.”

though that’s actually the only post here that was remotely related to the original idea…

pamplmoose 21 Apr 05

Yes, but delicious has the data. The site works best because it has reached a point of critcal mass (or whaterver the term is). So it is quite handy for tracking trends, seeing related topics (what will be hot next), forecasting site growth, and other marketing tidbits.

Delicious needs to sell marketing reports. (Well, that and invent additonal for-pay services.)That’d be a good idea if del.icio.us was used by people besides hipsters. I don’t think that anybody is really interested in trends of 20-30 somethings that buy their clothing from Goodwill and survive off of Starbucks coffee.

Andrew 21 Apr 05

Can you think of a business application for del.icio.us? I can: Pair its keyword tagging system with a corporate search engine, such as Google’s, for improved file organization and searchability.

Dave 21 Apr 05

I don�t think that anybody is really interested in trends of 20-30 somethings that buy their clothing from Goodwill and survive off of Starbucks coffee.

Yet Apple’s able to sell 4 variations of the same mp3 player to each of them. If you don’t want that data, I’ll take it.