Is it starting to become obvious to people yet, that 99.9 per cent of these Web 2.0 consumer plays WILL die?
TechCrunch reviews the upcoming Google Calendar. If you valued one of the squillion of Web Calendering apps on the market at $10 yesterday, write them down to a cent today. They’re all gone.
The only play that had a chance in this market was Trumba. Of all the Web 2.0 plays that SHOULDN’T have tried to build a revenue-generating business off the bat, it was Trumba. They could have used their speed to market and the network effect that was inherent to their approach to build a massive user base that would actually have some value now. Glad it wasn’t my $8 million they raised.
30 Boxes. Pfft. I said on launch it was a dog. Now it’s a dog with fleas. And what was that calendar with the stupid name? Sponge something? Can’t remember. Stupid and forgettable, that’s a neat trick. As I said at the time, their one innovation – the English-language parser – would quickly be replicated by others and guess what, it’s in Google. Bye bye, whatever your name was.
The primary problem for all these Web 2.0 startups is many were built on the assumption that it would be easier for a Google, Yahoo or Microsoft to buy rather than build. But, as you can see from some of the details leaking out about Google Calendar and some of the other things there doing most of these new add-ons are highly integrated into their existing apps. Not meaning to say I told you so (okay, yes I am) but as I said in my GMail: One app to rule them all post, all of this stuff is going to work together and as such its far easier to build than buy.
In fact the only way most of the Web 2.0 companies have any value is if they have sticky user-bases. That’s why Flickr, delicious (I refuse to do the dot thing), etc were acquired. You can clone just about any of this stuff in a matter of months but you can’t clone tens of thousands of passionate users.
Meanwhile, I was really glad to see fellow Aussie Nik Cubrilovic who has done a stellar job for TechCrunch while Mike Arrington has been away talking about some of the latest developments at SalesForce.com. Unfortunately, Salesforce.com doesn’t tend to qualify as being “cool” in Web 2.0 circles probably because they don’t have tags and they’re making too much money. That’s so old school.
However, when the gazillion web startups with no business models have all died it will be companies like SalesForce.com who will be left standing tall. Funny thing is for all the new business models that have been floated none have innovated where it counts – the revenue model.
I’m working with a company at the moment that has red-hot technology in a red-hot market and has what I think is red-hot revenue model too. The company founder thought much the same thing but on trying to raise capital to push ahead, kept getting the same message – you’re not Web 2.0 enough.
Here’s one of his rejection slips: “We would be interested in going further with this if you were conviced that building a lightweight web service was the key to your succes, but it seems like your end goal is still the [old-fashioned, proven revenue model]* and that makes it not our sweet spot. Let us know if your strategy changes.” (* Our description of the term in brackets.)
This VC is a complete and utter twit. However, unfortunately after getting this same message over and over, the founder went about trying to develop a “lightweight web service” (read no revenue-model consumer play). As far as I’m concerned the founder had it right all along. Why? Because his solution came out of a real customer need. He’s built it based on real problems, real feedback from real people who are prepared to pay real money for a real solution. We’re now looking at a channel model (gasp, shock, horror, weren’t all resellers supposed to be disintermediated by now) based on his original premises. I think he’s got a home-run on his hands with a concept that is really core to what the whole Web 2.0 movement is about. But because the VCs can’t put it in a nice, little neat Web 2.0 box he’s been passed over time and again.
I can guarantee one thing. He’s going to be around a lot longer than any calendar app. Unless of course Google buys him first.