Google Adsense is User Friendly, & a Lot of Work.

Posted on February 18th, 2010 by John Sostak

I started furlough on Monday.  Furlough is a Fire Department word for vacation, or holiday.  I have 5 shift days off, which equals 17 days without having to show up at the firehouse.  Great gig.

When I have a vacation, I like to figure out how to pack more work into this valuable “time off.”  My mission began with the successful roll out of FF911.  But there is a lingering issue I needed to address.  Domain name management, and affiliate traffic.  Doesn’t seem like there is heavy lifting in this mission.  There was, and I am sooo glad it is over.

I own about 150 domains, and manage about 300, for clients.  I am very aware that everything depreciates, and have been trying to find time to address the domains, what is parked at each domain.  This also means I need to go through the affiliates analytics. Commission Junction and Google Adsense are the big ones, and we have about 20 small ones.  This is a painful process.

The days of spamming lists are gone.  I hate to be the guy to reveal this to the countless spammers trying to sling me dick pills every day, but it doesn’t work.  We are being delivered the same bullshit messages way to many times for any online pharmacy, dating site, Nigerian lottery, to work.

I am curious what the conversion on this crap is.  I wish I knew a spammer (I know a couple) that is honest enough to tell me the truth.  I suspect it isn’t working.  We have everyone in the US online, so the first fools are no longer as fresh as they were when they first plugged in their PC and jumped online, through AOL.

I am always thinking about our traffic, where it came from, where it is going, and why.  If you are careful, there is an enormous amount of information in every visitor, and each click.  This information is potential revenue.  Google and Go Daddy are huge, because they protect the pennies.  They spend money, but these small revenue streams that are all service and advertising related are never overlooked by the big Internet pioneers.  Google has turned pay per click into billions in revenue.

So much of our world is automated, I forget how to plant myself in front of reports, and make the small changes, that require a little thinking, and a lot of mouse clicking.  Adjustments and tweaking are needed, but it is painfully slow.  It isn’t exactly grunt work either.  It doesn’t take skill, or talent, but you have to address the research and care enough to make changes that help the conversion of your traffic.

The past three days I have been dialing in these small elements that affect affiliate traffic, SEO, PPC, and advertising revenue.  It is the kind of thing that can go on forever.  When you are working inside of Google Adsense, and then tweaking banners, links, keywords, you lose track of how much time passes.  Each action requires multiple changes and corrections.

I have been working in Go Daddy for redirects.  Google for Adsense, and Analytics.  Create smart zones and populate some with PPC advertising through Google, others will carry Banners that pay through affiliate sales.  Contacting affiliates, like CJ, HostGator, Go Daddy, 37 Signals, etc. to get better landing pages.  Each web page (which equals 1,000’s) must be considered, so, I need to update XML site maps.  While checking site maps, might as well address broken links.  Broken links mean 404 redirects….  This is not fun.

I was just reminded that marketing 101 is relevant, and hard work.  May not be the same as fighting a fire, or pouring contract, but hard.  I think what really makes it painful, is you never feel like you are done.  If you walk away, you know there are things that still need to be done, and you have to be back on it, or your marketing campaign is less effective.

The fun activity in marketing has NOTHING to do with PPC, SEO, or affiliate marketing.  Yet, PPC, SEO and affiliate marketing are the tools that monetize the fun stuff we do in business, and online.  Luckily I can drink beer while doing the tweaking of our domains, PPC, SEO and affiliate accounts.

Tags: Go Daddy, Google, social media

Greg Whisenant Founder of Crimereports.com Profiled on Reuters.com

Posted on February 17th, 2010 by John Sostak

Reuters.com, Chicago small business and entrepreneur reporter Deborah Cohen reported on crimereports.com, and Greg Whisenant.  This is a very nice story, Greg’s success story can be found on Reuters.

Read the entire article on Reuters.  If you are a small business owner, entrepreneur, or just a fan of hard workers, this is a great story.  Greg is an example of a guy that creates success.  His idea was great, but his dedication and commitment is why it has worked.

“I’d never been a crime activist or particularly concerned about my personal safety,” said the founder of CrimeReports.com www.crimereports.com, who was working as a Washington lobbyist when he began attending community policing meetings in the D.C. suburb of Arlington, Virginia. “But I raised my hand, everybody clapped, and I was off the races.”

The early CrimeReports web site, which allowed police departments to register for free, essentially served as an elaborate email system, creating a conduit for municipalities to send localized alerts to members of the general public who signed up.

Today CrimeReports provides comprehensive local crime-mapping data to some 750 police departments, including cities such as San Francisco and Boston, and the entire states of Maryland and Utah.

Depending on their size, clients pay between $100 to $200 a month for data on homicides, break-ins, auto thefts and other crimes occurring in their service areas. The company also has a handy iPhone application, and offers police internal analytics for an additional monthly fee of $300 to $1,000.

“President Obama has made it an issue to be more transparent,” said Whisenant, whose public-policy career included stints as a legislative aide to U.S. Senator Robert F. Bennett (R-Utah), and later as a law-firm lobbyist working on technology and telecoms issues for large corporations. “There’s a lot of appetite at the federal level for more visibility and transparency, so it’s helped us.”

CrimeReports received a second round of venture financing totaling $7.2 million in August of 2009, and it expects to be profitable later this year. In the last year Whisenant has expanded his full-time staff from 10 to 37, made up mostly of engineers, sale reps and support personnel.

Whisenant called this growth a “rollercoaster” ride, recalling how for years he operated the site out of his home as a sideline project that wouldn’t go away.

“If the site ever went down, I’d start getting calls from the police and the public,” he said, noting that he sometimes ignored CrimeReports for months at a time. “I knew there was something there.”

Tags: entrepreneur

Apple App Store has over 150,000 Apps, & they all will work on the iPad.

Posted on February 14th, 2010 by John Sostak

Chart from Distimo that shows Apple has over 150,000 mobile apps.

From TechCrunch.

During Apple’s iPad event in January, CEO Steve Jobs announced that Apple now had over 140,000 apps in the App Store (along with over 3 billion downloads). If the numbers by app analytics company Distimo are correct, that number is now past 150,000.

But the App Store is growing so big, so quickly that these milestones alone are hardly noteworthy anymore. But Distimo also offers up some nice data along with the milestone number. For example, of the 150,000 apps, some 75% are paid applications while only 25% are free. This is in stark contrast to the second largest app store, Android Market, where recent data suggests that over 60% of the app there are free.

Something else that’s very interesting is that the highest percentage of apps in the App Store are now paid book applications. In total, there are over 27,000 book apps in the store, and of those 92% are paid apps, according to Distimo’s data. That number bodes very well for Apple’s soon-to-be-released iPad, of which a big selling point will be the new iBooks application. There has been a lot of talk about how the iPad won’t hurt the Kindle because the Amazon device’s e-ink makes reading more enjoyable. And while it’s true that e-ink is easier on your eyes (thank a backlit screen), it seems that iPhone owners simply don’t care — again, great news for the iPad.

In terms of overall app numbers, games still rule, with over 28,000 of them in the store. But a much higher percentage of those are free versus the percentage of free book apps. All told, both games and book are far and away the two most popular categories in the App Store, with entertainment in third with just over 20,000 apps. And the numbers drop quickly from there. Education is the fourth most popular category, but that means only 10,000+ apps.

Tags: Apple, apps, techcrunch

Determination and Commitment are Vital to the Success of a Digital Startup

Posted on February 12th, 2010 by John Sostak

This is what an Internet startup looks like.

I just read a good post in a discussion by Greg Satell about digital startups.  Thought I would share some thoughts.  I have enough experience with digital startups to be able to confidently state that the most important quality in a startup founder and team is determination. Determination is the quality needed to drive a startup through the growing pains.

An entrepreneur must be intelligent as well, but intelligence by itself is not enough to start a company, especially an Internet business.  We may feel like we were born with the web, but Internet startups are still new, and the business model lacks the direction of older more conventional business models.

Running a startup is like walking on your hands: it’s possible, but it requires extraordinary effort.  If an ordinary employee were asked to do the things a startup founder has to, they may be insulted, and at the least, discouraged.  Imagine being hired by a business to write code, and in addition to being reminded that the module was due yesterday (even though you were just told about it this morning), but you also are expected you to answer support calls, administer the servers, design the web site, cold-call customers, find the company office space, pick up lunch while your out, and empty the wastebaskets tonight, even if you don’t leave the office, because we have a client/investor visiting in the morning.

You do not get to do all this hard work in a comfortable environment, like a banker, whose only concern financially may be the size of his/her annual bonus, but against a backdrop of constant disasters, and financial insecurity (I hope the checks will cash). That’s the part that really demands determination. In a startup, there’s always some disaster happening. So if you’re the least bit inclined to find an excuse to quit, there’s always one right there.  This is why so many people and start ups fail, rather then fight, they take flight.

Everyone who deals with startups knows how important commitment is, so if partners, clients or investors sense you’re ambivalent, they won’t give you much attention. If you lack commitment, you’ll just find that for some mysterious reason good things happen to everyone but you. If you lack commitment, it will seem to you that you’re unlucky, and Twitter, Facebook, LinkedIn, Paypal, and every other Internet startup are lottery winners.

I have had partners that have the attitude that they’re going to give this startup thing a shot for three months, and if something great happens, they’ll stick with it– “something great” meaning either that someone wants to buy us or invest millions of dollars in our business. I have become a filter, because if this is your attitude, “something great” is very unlikely to happen to you, and this reflects on me. Clients,  acquirers, and investors judge you by your level of commitment.

If an acquirer thinks you’re going to stick around no matter what, they’ll be more likely to buy you, because if they don’t and you stick around, you’ll probably grow, your price will go up, and they’ll be left wishing they’d bought you earlier. Ditto for investors. What really motivates investors, even big VCs, is not the hope of good returns, but the fear of missing out.  So if you make it clear you’re going to succeed no matter what, and the only reason you need them is to make it happen a little faster, you’re much more likely to get funded.

You can’t fake this. The only way to convince everyone that you’re ready to fight to the death is to fight to the death.  With a deferential nod to Seth Godin, and the Dip, by fight, we also mean adapt, and make the necessary changes to find success in your space, which may be poorly defined, and full of blue skies.

You have to be the right kind of determined, though. Determined rather than stubborn.  Stubbornness is a disastrous quality in a startup (I have been both).  You have to be determined, but flexible, like a running back.  Adrian Peterson doesn’t just put his head down and try to run through people.  He improvises: if someone appears in front of him, he runs around them; if someone tries to grab him, he spins out of their grip; he’ll even run in the wrong direction briefly if that will help.  The one thing he’ll never do is stand still.

Tags: IPO, start up, technology

2010 Tech IPO Candidates from TechCrunch.com

Posted on December 24th, 2009 by John Sostak

Wall Street Bull

Article by Eric Schonfel, TechCruch, December 24, 2009.

It’s been a long drought for IPO’s, but venture capitalists and tech entrepreneurs are hopeful that 2010 will be the year they rain down on the Valley once gain. Earlier this year, a handful of IPO’s trickled out, such as Open Table, Rackspace and A123Systems.  But what people are really waiting for is another Netscape or Google moment —an iconic IPO which will whet investor’s appetites and open the floodgates for others to follow.

Below is Tech Crunch list of the top ten IPO candidates for 2010 in the technology industry (and, no, it doesn’t include Twitter). I conducted an informal survey of some top VCs and angel investors. These are the names whispered about the most in the Valley and other tech circles. The hope is that the economy will swing back and the public markets will become receptive to IPOs, especially towards the second half of the year.  The stock market in general is finding its legs already.  The S&P 500 is up 24 percent this year. If the bull market continues, that will be good for the prospects of seeing these potential IPOs.  And if it doesn’t, there’s always M&A.

1. Facebook Total raised: $716 million.

If there is one company which everyone is looking towards for a new Netscape moment, it is Facebook.  The company can pretty much go public any time it wants.  It is already the fourth largest site in the world.  It’s last private common stock sale valued the company at $11 Billion, which may or may not be rational.  The key to a large public valuation will be whether Facebook can figure out how to turn all of that attention into advertising dollars.  So far it is said to be on track to beat its $550 Million revenue projections from earlier this year.  A Facebook IPO would certainly create a halo effect for other tech offerings.  Even if it doesn’t go out in 2010, the prospect that it might could still help other companies go public as hungry investors grab what they can get.

2. Zynga Total raised: $219 million.

Social game developer Zynga is on a tear, with more than 230 million people a month actively playing its games such as FarmVille, PetVille, and Texas HoldeEm Poker.  The company just raised a whopping $180 million round.  It is believed to be Facebook’s largest advertiser and pulling in at least $250 million in revenues on its own.  But it is also at the center of the Scamville Controversy over how it makes some of its money from scammy offers.  If it can convince investors it has cleaned up its act, they will gobble up an IPO.

3. LinkedIn Total raised: $103 million.

The other social network, LinkedIn is like the enterprise version of Facebook. It is where business gets done and people find jobs.  LAst year alone it raised about $75 million at a $1 billion valuation. Founder Reid Hoffman has spoken repeatedly about LinkedIn’s ability to IPO.  Earlier this year, he recruited former Yahoo exec Jeff Weiner to be CEO and is spending more time himself as a venture capitalist, which has always been his sideline.

4. Glam Media Total raised: $125 million.

Glam Media is one of the fastest growing ad networks and collection of fashion- and women-oriented sites.  At a time when traditional media and women’s magazines are suffering, Glam is saw display advertising revenues across its network up more than 50 percent in 2009.  CEO Samir Arora expects the company to be profitable in the fourth quarter, and is recruiting executives with big-company experience.  Ad networks which dominate their niche are an easy lay-up for investors.

5. Demand Media Total raised: $355 million.

Demand Media is another LA-based company, started by former MySpace chairman Richard Rosenblatt.  Demand Media owns a collection of sites such as eHow, Livestrong, and countless niche sites.  It also owns domain name registrar eNom, which generates a lot of its cash.  Demand Media is a content mill, churning out articles and videos for its niche sites like Golflink.com and Trails.com  cheaply and quickly in response to what people are searching for.  It may not be sexy, but it is lucrative enough that potential acquirers are sniffing around and AOL’s Tim Armstrong is looking to copy and improve on the niche content model.

6. Gilt Groupe Total raised: $48 million.

Gilt is a private online shopping club for luxury goods.  Its revenues are reportedly around $200 million this year, and expected to more than double next year.  IPO talk is already in the air.  Gilt’s counterpart in Europe, Ventee-Privée, is rumored to be in acquisition talks with Amazon for around $3 billion.  And Kleiner Perkins just invested in One Kings Lane,  another private shopping club based in England.

7. Etsy. Total raised: $31.6 million.

Another niche e-commerce play could be Etsy, the Brooklyn-based marketplace for handcrafted goods.  Sellers on Etsy are on track to trade $200 million worth of goods on the maretplace this year, double from last year.  Founder Rob Kalin recently took over again as CEO and says the company is now profitable.  Etsy will never be as big as eBay, but its focus means that can become a the alternative eBay for buyers and sellers of high-quality, custom-designed apparel, furniture, and other goods.

8. Yelp Total raised: $31 million.

Yelp was nearly acquired by Google for around $500 million before the deal broke down last week.  The fast-rising local reviews site now might try the public markets instead.  The company already has 300 employees and is becoming a powerhouse in the online advertising for local businesses, which is an area of growth every major Web company wants to participate in.  Already the IPO filings are starting to come in, with ReachLocal filing to raise $100 million for its local ad network.

9. Tesla Motors Total raised: $783 million.

Why would you invest in the GM IPO if you could invest in Tesla instead?  Silicon Valley’s electric car company is expected to hit the public markets.  Building a car company takes massive amounts of capital, and Tesla has raised nearly $800 million so far.  Most of that comes in the form of government loans, such as the $465 million it received as part of the government’s $25 billion bailout of the U.S. auto industry.  A lot of the capital also comes from partner Daimler, and billionaire founder Elon Musk.  But, hey, at least Tesla is profitable, which is saying a lot for a car maker.

10. Skype Total raised: $69 million

Despite all the drama surrounding eBay’s recent sale of Skype to a group of private investors including Silver Lake Partners and Andreessen Horowitz for $2.75 billion, the deal got done.  Skype is already a major Internet brand, with more than 500 million users of its Internet calling, IM, and video communications service, and $185 million in quarterly revenues. Before eBay found its buyers, it was very publicly pursuing the IPO route.  Given that eBay retains a 30 percent stake in Skype, that is still an option if its growth continues apace.

Runner’s Up:  The ten names above are the most likely to go public if the markets open up.  Other companies which might tap the public markets include Associated Content, Brightcove, Digg, StumbleUpon, LiveOps, Workday, MerchantCircle, ExactTarget, Chegg, and Reardon Commerce.  Most informed observers do not expect a Twitter IPO next year.  It is too early.  The company just raised $100 million, and still needs to figures out its business model.  Maybe in 2011.

Which of these companies do you think is most likely to IPO?  Which ones would you invest in?

Photo credit: Flickr-David Paul Ohlmer

Tags: IPO, techcrunch