$4M of VC For a Dress-Up Site?

Okay, I think this is the sign of the Web 2.0 apocalypse - Index Ventures and angel investors have invested $4-million into, which lets visitors – mostly young girls and women, I guess – to dress more than 320 dolls online. Apparently, it attracts more than one million unique visitors a month but, come on, it's a virtual dress-up site that looks like it's a nice way for the pre-teen set to waste…er, spend some time online. So how does Stardoll make money? There are apparently two ways: advertising (although there was none that I could see) and a premium service that provides access to an ad-free, VIP-area where members get to dress all dolls, including 15 VIP dolls. Frankly, I don't get why it warrants $4-million of venture capital unless it's generating tons of revenue from advertisers looking to go after the young girl demographic..  Index Ventures make a huge killing from being one of Skype's early investors, and it recently put money into FON. Stardoll has hired Mattias Miksche as CEO. He started and E*Trade Northern Europe.

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  • bigfish

    They have adsense on every page and CPM ads to.
    I would be shocked if they aren't making at least 50,000 a month off adsense and the CPM stuff.

  • Anonymous

    If they have AdSense, then they likely aren't making anything from it. AdSense has a factor called smart pricing that penalizes advertisers that have low conversion rates. A site for pre-teens would have an extremely low conversion rate, in fact, it would be near zero.

  • Anonymous

    That was me.

  • bigfish

    I have a poetry site that contains love poems, it gets 15,000 uniques a month and makes $600 off adsense. Mostly 14-16 year old girls visiting it.
    It is by far my worst performing site, I would assume the doll site would make similar money off adsense so it would make around 44 grand add in the other stuff and they should get at least 50k.