Posts Tagged ‘revenue’
Disclaimer, I adapted this from my blog for Etelos, as one of our executives will be speaking there.
Do you know what South by Southwest is? Sure, it’s a great music festival, but did you know it is also one of the best tech conferences around?
SXSW Interactive is a compilation of some super quality speakers and panels as well as some of the best networking (read: parties) around. It is by far one of the best events I’ve attended.
Loading…This year’s event, however, has a different appeal for me. I was able to secure a pretty powerful panel for Etelos founder & CEO Danny Kolke. OpenID, OAuth, Data Portability and the Enterprise will explore the challenges enterprise class companies face over data ownership.
Featuring Joseph Smarr from Plaxo, Kaliya Hamlin, AKA “Identitywoman” and Bob Blakely from the Burton Group will join Danny to discuss if OpenID and OAuth are good for the enterprise and how to implement them.
Shifting the focus
I think this will be an excellent topic for this year’s event. Layoffs are piling up, mandatory furloughs are being enforced and startups are folding. As the emphasis shifts from true innovation to a successful business model, the debate over identity and data ownership becomes essential.
A prospect or sales lead is an invaluable commodity, and this is even more true in today’s economic climate. But who owns that relationship? Who owns that customer’s contact information?
Meetup Tweetup Restup
Lots of exciting parties have already been announced and dozens more will undoubtedly pop up as March approaches. I have an awesome idea for a smaller, more intimate meetup opportunity if anybody is looking for an opportunity to host something.
I look forward to meeting you all out there and discussing some public relations goodies. As an extra bonus, Kaliya is organizing a lunch that will follow the panel. Come, join us there too!
I’m in the process of building up a schedule, but I want to get your input. What sessions have you excited? What speakers must you see? What parties are already on your list? Fill out the handy-dandy form or post a comment.
Tags: Add new tag, conversation, Enterprise, friends, Kolke, OAuth, OpenID, party, relationships, revenue, socialmedia, SXSW
I think that 2009 will be the rise of the microbusiness. In today’s technology world, a win is no longer getting hired as an engineer at IBM or a marketer for Microsoft. Rather, it is finding clients as an independent “consultant” or working with a small startup that sees some element of success.
According to TechCrunch, more than 100,000 layoffs occurring in the tech sector at the end of 2008. And some of the largest numbers came from large enterprises. No longer is joining an established tech company a refuge for talented people who find themselves jobless as companies such as Sony, 3M and AT&T announcing heavy cuts.
The rise of the microbusiness
Using TechCrunch’s numbers, this is more than 100,000 people that are looking for a paycheck. Not necessarily a career, but a paycheck. They are taking freelance development and design gigs, working with staffing agencies or services such as Elance and building a modest client base.
But a decision will need to be made. Do they continue down the freelance path or seek the stability, opportunity and shelter of a full-time job? Freelancing is a contact sport these days and strong, talented and effective people will survive.
Unfortunately, most statistics aren’t current, but to give you some idea of what I’m talking about, here are some stats I was able to find:
- According to the US Census Bureau, 17,646,062 firms existed in 2002 that were classified as “nonemployers.” This meant that they were one-person businesses. This represented more than two-thirds of all businesses in the US at the time.
- By 2004, the number of nonemployer firms was 19,523,741.
- In 2004, of the 5,885,784 firms with paid employees, 3,821,128 had fewer than 10 employees.
- Sole proprietorships can be lucrative. According to BizStats, Internet publishing-Broadcasting businesseshad a net profit margin of nearly 65% in 2004.
- According to SCORE, there were 637,100 new businesses, 560,300 business closures and 28,322 bankruptcies in 2007.
These numbers show that we’re not afraid to venture to new, uncharted territory. When we take control of our own destinies, we are able to shape our lives to fit our ideal. What is your ideal?
Charting the path
This is where technology comes into play. Building a product is easier, cheaper and faster than ever. Social media and social networking are eliminating a lot of the overhead and burn that would consume an investment. Social networks, blogging and social advocacy are making it easy to create a network of passionate users.
All of these changes will make it easier for entrepreneurs to venture out as sole proprietors and make a product or a service that works. Sure, there will be some casualties. There always is. But, what makes microbusinesses different is the sef-reliance, bootstrapping mentality will come back into vogue. New avenues will be explored and new revenue streams will be identified.
What will you do to make your microbusiness succeed? How will you move your idea forward and make your microbusiness succeed?
Tags: business, entreprenuer, revenue, wacky idea
Yes, you read that right. Monetization does NOT equal revenue. I’m tired of hearing about Web “applications” that are promising venture capitalists that their ad-supported business model is going to be successful and yield that 15x return their looking for.
Monetization is…
Monetization, as I define it, is using advertising to make some money off of your Web site. It is not recurring revenue that results from users willingly paying for the service.
This is a dangerous model to put much faith in for a number of reasons. The first is the visceral reaction the general public has to advertising. When was the last time you thought to yourself, “Man, I really liked the annoying Flash ad. I must go see ‘Legally Blonde 7: Divorce Rules.’ ”
Advertising is effective as a brand awareness driver. If you’re letting advertising dictate your purchasing decisions, then that’s a separate issue. What advertising is not, however, is a model on which to build a business. Because the only one getting rich off of ads is Google.
Revenue is…
When a Web application is so valuable that people willingly pay a monthly or annual fee for the pleasure of its use, that is revenue. Revenue is profit. Revenue is a viable, sustainable model for growth and success.
When a Web application offers functionality that either increases my productivity or adds value to my life, I’ll gladly pay for it.
So, when I saw that LinkedIn recently completed a founding round of $53 million, I nearly choked. Not only does this value the company at $1 BILLION, but it also gives them plenty of ammo to fire across the bows of upstart SocNets. According to the LA Times, LinkedIn has been profitable for a couple of years. So, where does this revenue come from? I don’t pay for it. Nor will I.
Online Advertising
So, in the chart I’ve embedded from the Interactive Advertising Bureau, the growth rate of online advertising revenues has been astonishing. In Q1 of 2008, online advertising revenues were approximately $5.8 billion. So, why do these companies need so much venture capital? I think it’s because that “revenue” is only being realized by the ad networks and not the apps them selves.
It kind of pains me to link to Valleywag, but they did the dirty work for me on this. Time recently announced its 50 top Web sites and Valleywag made some quick and dirty analysis (really, is there any other kind?). Of the 50:
- Ad-supported:36
- Google ads: 18
- Microsoft ads: 1
- Yahoo ads: 2
- In-house ad sales teams: 3
- Sell goods: 2
- Sell physical goods: 1
So, of “Web sites,” advertising is obviously a good way to make some revenue. But for businesses, it’s all about subscription models and real users paying real money.
How will you make your profit?
Tags: money, revenue, Web 2.0, Web apps