Earlier this week, I did a post looking at how it’s fundamental for online businesses to have a product/service that people want to purchase – as opposed to building something popular that people aren’t willing to buy. I cited companies such as Freshbooks, Rypple and Sysomos.
What I’m curious about is other online companies that are operating businesses (e.g. generating revenue) as opposed to offering free services to attract users and, eventually, a takeover offer.
Thoughts?
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Mark, there are hundreds of them. Many are in the Social Media analytics (monitoring) space, many more are in the Social Network Infrastructure, Advertising Network, Knowledge Management and Business Intelligence markets. What is most interesting is trying to determine who delivers measurable business value verse "Hype Factor" (I've gotta do this cause everyone else is) services that are not sustainable. I'm looking forward to seeing what kind of responses you get to this.
How about ClearFit.com? Hundreds of customers in just a few months and it's a service that people purchase.
You mean, companies that want to make money from the beginning; not just hope someone will see value in their online space, purchase them, and then be left trying to figure out where the money's at?
We're an advertising-based consumer-facing website and are profitable. Of course costs are extremely low, but you didn't specify rules on that
StyleFeeder.com is another profitable ad-based consumer-facing startup.
There are a few good examples of companies that are actually getting revenues here in Toronto. Us (Homestars), Freshbooks, Agoracom are examples that come to mind, where users are actually paying for a useful product outside of just monetizing eyeballs on the site – which takes a lot of eyeball to make money.
I'm not sure analytics are what you'd call 'money making' online businesses. Isn't that more like figuring out who you're going to sell the eyeballs looking at another service to? Yes, people pay for those services, but it's perhaps trying to solve the problem of what to do with (how to monetize) the people who play with free stuff offered on a site.
I don't think companies with ad-supported business models like those mentioned above are the best example of the businesses Mark is thinking of.
I think there are many companies exploring online social opportunities with products and real revenue, based on a SaaS model. Our company included, aiming at the Dutch education with several web-based software products under the umbrella brand Remindo.
These products are paid per user bij our customers (schools, educational publishers) who actually want to pay for using them, generating revenue for our company. That doesn't rule out potential takeover offers, but that's not primarily what we're aiming for.