Archive for the ‘Google’ Category
The Millionaire Masseuse
Monday, November 12th, 2007Interesting article in today’s New York Times about Bonnie Brown, who joined Google in 2000 as a part-time masseuse for $450 a week (to massage the engineers’ necks and backs) and has now retired thanks to the stock options that she received. She cashed in most of her options in 2005 and became a multi-millionaire. She held to a few and is now enjoying the benefits of investors’ continued love affair with all things Google.
That’s one way to make a million bucks.
The Samwer Brothers
Sunday, October 28th, 2007As we say every time we present, our goal is to supplement not supplant Google.
It’s a life-changer, a great technology. And combined with YouTube, the ability to retrieve general information from the web is amazing.
What am I talking about?
Well, at DEMO GERMANY a couple of weeks ago, we were literally face to face with Oliver Samwer, one of the trio of German entrepreneurial brothers with a seemingly golden touch. Oliver gave the keynote, and I was in the backstage area with him before he spoke. Our presentation was right after his speech, so there were only a group of 5 of us plus Oliver in the backstage area.
I listened to his speech and thought that he sounded like a nice guy. I’d only started to hear about the Samwer brothers after the sale of StudiVZ to Holtzbrinck Ventures for €85 million back in January 2007. Plus, I’d just bumped into Michael from StudiVZ at Etre in Budapest, so my interest in both the Samwer Brothers and StudiVZ was piqued. Oliver from Red Herring had also told me a bit about them at ETRE, so when I got back home from DEMO Germany, I decided to see what help Google and YouTube might offer.
A little bit of research on Google showed that they are innate entrepreneurs that sold their first company, Alondo.de (a German marketplace site, like eBay) to eBay for €40+ million about 100 days after they founded the company. They then served as managing directors of eBay Germany, which they made into the most profitable international site of eBay. A few years later, they struck gold again with Jamba, which became the market leader for wireless content such as ringtones, pictures, games and videos for mobile phones in the US and Europe. Verisign acquired Jamba in 2004 for $273 million.
So now the brothers focus on helping to create an ecosystem in which entrepreneurs in Europe can thrive. From what I’ve been able to find out, Alex (the youngest brother) runs a foundation that supports Romanian children that can’t afford an education. And Oliver and Marc focus on mentoring and supporting young entrepreneurs, not just with their money but also with their time.
It’s cool to see this kind of thing. The brothers seem profoundly normal and real, without the ego-tripping that sometimes infects very successful people. They seem like good people who are trying to make a difference after their bit of good fortune (and hard work). Either that, or they are amazing actors.
Take a look for yourself.
Oliver Samwer
Marc Samwer
Migoa Launches Nuroa
Wednesday, September 26th, 2007We did it!
After what can only be described as an eventful and interesting year and a half, our website has finally gone live.
In the end, we have decided to launch vertical by vertical, country by country. The goal is to offer a depth and degree of local knowledge that tends to be absent in some of our competitors. We understand that classifieds are extremely local. Not even national in many cases. Extremely local.
A user in Berlin could often care less about the housing market in Munich (unless the move is inter-regional).
Similarly, most home buyers in Barcelona could care less about the various neighborhoods in Madrid. That information does little to inform her search for a property in a few select neighborhoods in Barcelona, and even within Barcelona, if she’s only searching for properties in Gracia and the Eixample Esquerre, she could probably care less about the real estate market in Sants and Sarria (two other districts within Barcelona).
Our goal is to understand what motivates and concerns the user in each key region. Otherwise, it will be very difficult to provide a truly satisfying user experience. There’s a limit to how individualised you can make the search experience, but the goal is to make it feel extremely personalised, and the first step in the context of a real estate search engine is to make it feel extremely local.
So that’s why we have started with two real estate sites: one in Germany (www.nuroa.de) and one in Spain (www.nuroa.es). They’re password protected for a couple of weeks — we’re still correcting a few major bugs like the fact that the search engine confuses Barcelona city with Barcelona province — but we will give the password to anyone who wants it, and we wholeheartedly welcome your feedback. (Please send me an email to gary @ migoa.com, and I’ll get you the passwords.)
Our goal is to launch in the UK and France within the near future, but only to the extent that we can launch something that demonstrates an understanding of how the local markets work. And only to the extent that we can dedicate sufficient resources so that the websites don’t just become cut-and-paste versions in French and in English.
We are the only vertical search engine in the world to include what we are calling “intuitive search”, which essentially means that we integrate web 2.0 aspects (i.e., we integrate relevant real estate blogs, newspaper articles, videos, photos, etc.) into our search results without detracting too much from the central focus of the page — the real estate listings. So if you do a search for “piso Barcelona”, you will get the search results AND in another column you might see relevant articles from the APIs in Barcelona telling you why now is the time to buy, or a study from BBVA about the evolution of prices in Barcelona, plus pics that other users have taken in and of Barcelona, etc.
We think that intuitive search is the wave of the future. The “big” search engines are already experimenting in this area with Ask3D and Google’s universal search. We think that they understand the future of search pretty well, so we adapted some of their insights to our particular verticals.
And such an approach makes sense. We understand that finding the right apartment is often only the first of many steps in the property purchasing process. And it is only one of the many considerations that will determine if, when and how you will purchase your dream home. So our results page tries to figure out what these other relevant considerations might be and provides you the collective insight of other members of our real estate community.
Our refined search features are also pretty cool and are supplemented by the ability to search by tags. And it all works pretty dynamically. So you have many options to narrow down the millions of possible search results into the few really relevant results that meet your criteria. That’s the key comparative advantage of a “vertical” search engine relative to a “horizontal” one like Google — the results should be more precise and relevant with regard to the vertical in question.
Our “official” launches will take place during the month of October at various conferences. We will launch the German site at DemoGermany (the German/European equivalent of the successful US conference). And if all goes according to plan, we will launch the international site at the Future of Web Apps (FOWA) conference in London next week. We’re currently ironing out the details right now with Ryan, but it looks like they’ll give us a few minutes in front of the general audience to make a brief pitch. Both are cool events that will be attended by influential bloggers and press, so it makes sense for us to use them to launch.
And on top of that, both conferences should be cool.
I sincerely believe that the final product reflects the hard work and analyses that went into it. A lot of influential investors and people from the sector have already congratulated us on the interface. And our tech is probably among the best of the current vertical search players. That’s our goal, in any case.
One commentator on Juan Luis’s blog said that we took too long in development, which surprised me given that we took the same amount of time as the original vertical search engines in the US. Our goal wasn’t to put out a rushed and underdeveloped product, or a cut-and-paste version of what already exists in the US. Our goal was to put out something innovative with truly disruptive potential. I think that we have done it.
And as I have noted elsewhere on this blog, Google was the 12th search engine to launch.
The goal isn’t always to be first.
The goal is to be the best.
Particularly in the tech sector, the two concepts are often not synonomous.
Try out nuroa and let me know what you think.
Killer Valuations: Facebook to get $500 million for 5%
Monday, September 24th, 2007The Wall Street Journal is reporting that Microsoft is in talks to buy 5% of Facebook for $300-500 million. Facebook is courting multiple investors and is asking for a valuation of at least $10 billion.
Google is apparently also in the running, though Google has a lot less cash saved up than Microsoft does.
Must be nice to be Mark Zuckerberg.
Facebook is growing quickly. It not boasts 40 million users, up from 9 million one year ago.
But the funny thing is that the Journal reports that Facebook has chosen the investment approach, because their business model can’t sustain an IPO. The valuation isn’t based on actual earnings or profit. It’s estimated that Facebook has earned the majority of its $60 to $90 million (with no profit) in annual revenue from an advertising deal with Microsoft and that this year it will have a profit of $30 million on revenue of $150 million.
That’s a multiple of 300x profit, which is a bit exagerrated, particularly if you take into account that the payments from Microsoft are effectively a subsidy to create a relationship with Facebook. Although social networking sites like Facebook have huge audiences, most of their members don’t want to see ads. Their click-through rate is relatively low.
But the valuation is more about the clash of the Titans — Google vs. Microsoft — and the fight for the future of the Internet than it is about Facebook per se.
The Journal also has an interesting “where are they now” study of GeoCities, a social networking site that was the Facebook of its day. In August 1998, GeoCities was the 3rd most visited site on the web, and Yahoo bought the company in 2000 for $4.7 billion. But GeoCities failed to update its technology quickly enough so that less than a decade later, the site and its technology are obsolete. Apparently, Yahoo was more focused on building traffic than on improving the service, which meant that Facebook, YouTube and MySpace were soon able to dominate the social networking space.
As the Journal points out, of the top 20 most visited sites in 2003, only 9 still occupy market-leading positions. Innovation — and finding a viable business model — are the keys to staying relevant.
$500 million should go a long way towards making that possible.
Führ mich zum Schotter! (”Show Me the Money!”)
Tuesday, September 18th, 2007
One country, one vertical.
That’s what I thought as I read the news that Deutsche Telecom had exercised its right of first refusal to buy Immobilienscout24 for €500 million.
Back in late August, Jesus announced that PBL and Macquarie Bank had formed a joint venture to buy 66% of Immobilienscout24 for €357 million, which would have valued the company at €540 million. PBL is a traditional media company that is apparently trying to enter the online classifieds space more aggressively. They already own Australia’s second most important real estate portal: MyHome.com.au.
Axel Springer, a large German media group, was also in the running, but dropped out when the price got too high.
There’s no doubt that Immobilienscout24 is Germany’s biggest online real estate portal. The company boasts some monster numbers:
- Revenue of €53 million in 2006
- EBITDA of €21 million (meaning that the acquisition price was about 24x EBITDA)
- 1.2 million ads
- 70,000 customers
- 2.5 million visitors per month
Again, this is one vertical, one country.
We will soon launch our property search engine in both Germany (www.nuroa.de) and Spain (www.nuroa.com). As we embark on this journey, Immobilienscout24’s numbers will no doubt serve as both a challenge and an inspiration.
It was also interesting to note that, as Nicole from Blognation points out, the rationale for the transaction was to diversify Deutsche Telecom’s business model. Apparently, the company is losing money from its traditional telephone business and wants to promote a more modern image by focusing more on Internet-based businesses.
It seems that it’s not only the traditional media companies that see the value of online classifieds businesses.
It’s Britney, bitch!
Wednesday, September 12th, 2007Online videos (and a tabloid-worthy personal life) killed the untalented pop star.
Britney Spears is over. She’s amassed an amazing fortune based on limited talent and her ability to glamorize normalcy. Her unique trait seemed to be her hunger to succeed and her Janet/Michael Jackson-like performance skills.
But that was two kids and a rushed marriage ago.
Her performance at the MTV Video Music Awards were profoundly normal but decidely unglamorous. It was like a bad Karaoke night in little Tokyo. The lip-synching sucked. The dance moves were limp. She was sporting a beer gut, despite being dressed skimpily in “sexy” lingerie.
The most interesting part of the entire performance was to see how MTV is now using online videos to pump up its declining relevance and to combat YouTube.
In addition to the Britney performance, MTV’s website boasts Kanye West’s meltdown (he complains that a black man apparently can’t win an MTV award — with his bank account, I hardly feel sorry for him. I don’t think that his failure to win an MTV VMA is the biggest struggle facing the black male population).
And there was the all-out, “white-trash” slugfest between Kid Rock and Tommy Lee, both of them ex-husbands of the even more sordid Pamela Anderson.
Apparently, the fight was for Pamela’s virtue. A losing battle.
And it was all caught by MTV’s cameras and streamed via its online player.
Of course, I didn’t watch the MTV Awards. I read about them online in the New York Times and perezhilton.com, before redirecting myself to MTV’s website to see the highlights.
MTV apparently understands that you won’t view the awards on regular TV either. They’ve completely revamped the format to focus on the YouTube generation that wants more performances, fewer speeches, and all of it in short video snippets. And they’ve promised not to rebroadcast the show 100 times on their channel.
Instead they’ll let you stream it from their website, based on your preferences.
And they’ll sue anyone — in particular, YouTube — that attempts to broadcast their content without permission or a good revenue-sharing plan.
Once again, it’s clear that Internet is disrupting media — some of it traditional, and some of it more provocative and youthful like MTV once was. (For a less pop-culture review of the disruptive force of online videos, see Ollivier’s post (in Spanish)).
Yellow Pages vs. Local / Classifieds Search
Thursday, September 6th, 2007eMarketer has an interesting study today of the shift of local ad dollars away from traditional offline yellow pages to search engines in the United States. The argument goes as follows:
- Local offline yellow pages directories are a big market ($12.4 billion), particularly compared to national offline yellow page markets ($2.2 billion).
- Internet yells page directories (IYPs) don’t function as well, because people searching in a phone book go to the business categories as determined by the book’s index. People on the Internet go to search engines and do keyword searches.
- If only 20% of the ad dollars from offline classifieds and directories (a combined $37 billion market in the US) to online classifieds and search engines that would add up to $7 billion of additional local online ad spending in the US alone.
The following chart demonstrates both the current power and future potential of online classifieds and local search markets in the US.
Internet Yellow Pages sites, on the other hand, are expected by most analysts to grow a lot more slowly.
eMarketer notes that not every analyst supports the conclusion that local search will grow more quickly than Internet Yellow Pages.
But it appears to be clear that, regardless of to which destination they might go, people are moving online to find out more information about local businesses, whether in the form of Internet yellow pages, local search, local directories or newspapers online.
It’d be interesting to see the relevant numbers for Europe.
Web 2.0: An opportunity for forward-thinking media companies
Wednesday, September 5th, 2007Simon Waldman, Director of Digital Strategy for the Guardian Media Group in the UK, has posted a very insightful presentation about the intersection of the Internet and Web 2.0 on his blog. The text reflects a speech he gave to a German general media audience in Berlin. There is also a pdf version of the script of the presentation.
Simon makes the following arguments:
- Newspapers that want to survive need to embrace, exploit and excel in web 2.0. “There is no denying that our industry — particularly in Western Europe and North America — is structurally challenged, and that is almost entirely down to the net. . . . But I fundamentally believe that newspaper publishers who are prepared to experiment, innovate and invest online will create significant cultural and commercial value as a result of their efforts.”
- Internet moves quickly and probably a lot more quickly than the pace to which traditional media groups are accustomed. “Being online is like having a shop in a mall– you have to keep up with everyone around you, even if they’re not a direct competitor. Otherwise, you seem very tired, very quickly.”
- There are four axes of Web 2.0. “I know that there are all sorts of definitions of Web 2.0, but in my mind there are four key characteristics in the boom: Social networks, search and aggregation, collaboration and video.”
- Google is a frenemy. “Google and its impact on every sector of the economy’s attempt to grapple with the Internet are undeniable — and the newspaper industry perhaps more than most. Some of us see them as a competitor and a stealer of content; others see it as a source of traffic and revenue . . . . [B]ut all I will say is that defining and understanding a relationship with Google and other search players and aggregators is a crucial part of operating effectively in the online world.”
- There’s no turning back, even though most newspaper companies and traditional media groups might wish otherwise. “I wish Google would go back to being a nice, cuddly search engine that does no evil, rather than a global advertising bohemoth. Or at the very least, I wish they had to pay big bucks to carry our headlines and first paragraphs on Google News. I wish free classifieds sites would go away, or that the Internet has recruitment advertisers rushing to spend more rather than less. . . . [B]ut I also know that they are not going to happen. . . . The point is - this is about change. Not a gentle, start of the new school year, kind of change — but disruptive, shifting of tectonic plates kind of change.”
It’s good to see this kind of realistic optimism from the traditional media. There are obviously a lot of synergies between newspapers / media groups on the one hand, and search engines on the other. Indeed has The New York Times as an investor and strategic ally. Simply Hired has News Corp. Yahoo and Google are also increasingly trying to create cross-selling opportunities with newspaper groups.
But it’s also true that when we spoke to some investors initially - and even more recently - people seem to have the concern that search engines and aggregators “steal” their content, rather than they are partners that can redirect traffic to their businesses for less money than traditional media outlets, like newspapers, that charge a lot more for reaching target audiences.
In any case, it seems that the “slow death of newspapers” at the hands of search engines, aggregators and online classifieds sites is in the news a bit this week. Don Dodge has also an interesting post entitled “Online classified ads take $3.1 billion from newspapers,” which is review of an article in the Washington Post about the same topic. The post article is particularly interesting because it examines how vertical search engines such as Edgeio and Oodle are disrupting traditional classifieds businesses.
The bottom line: Search engines and aggregators are here to stay. Not all of us will survive, and most of us will be co-opted or bought. A few may become large, independent IPO-friendly companies. But the technological and economic disruption to traditional media companies can not be ignored or denied.
Beyond Google — The article that inspired migoa
Wednesday, August 29th, 2007Since I haven’t posted in a bit (I was away in Nice for a few days of vacation), I’m feeling a bit apologetic and maybe also a bit nostalgic. So I’ve decided to “honour” the Wall Street Journal article that initially inspired us to start migoa. It was back in late 2005 when Oriol and I were looking to start a business together and were scanning the US newspapers for interesting ideas. We came across this article, and the rest is history. It seems a bit outdated now — we’ve learned so much since reading this article about search, vertical search, advertising models, Internet businesses, etc. — but the article’s key insights remain the same: One size doesn’t fit all.
I hope the Wall Street Journal won’t mind this brief “honour”. It’s done with nothing but love (and Rupert Murdoch is apparently going the online Journal more accessible, so I’ll help give them a jumpstart).
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December 19, 2005 |
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DOW JONES REPRINTS
• See a sample reprint in PDF format.
Consumer Technology
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Google loses no. 1 status in user satisfaction
Monday, August 13th, 2007Reuters is running an interesting story today noting that Yahoo has beat Google in a major US user-satisfaction survey. The University of Michigan American Consumer Satisfaction Index (ACSI) showed that Google is on the decline, while ASK has shown the most improvement and Yahoo is no. 1:
- Ask.com’s search engine has risen most significantly in customer satisfaction ratings, up 5.6% to 75 points. ASK’s improvement is the result of a phenomenal redesign and refocusing on its search technology, plus an ambitious $100.000.000 marketing campaign.
- Yahoo rose 3.9% to 79 out of 100 points. It’s improvement is due to a relaunching of the main site and the increasing popularity of various features and services.
- Google fell by 3.7% to 78 points. It’s decline is due to the perception that the Company has not really improved or altered its search technology and interface in years. The summary is that Google needs to find a better way to market its new features and services, because the Company is being overshadowed by the dominance of its main search engine, which doesn’t look like it has changed much. And web users want to see marked improvements in a product from year to year to increase in their user satisfaction.
- AOL dropped more than 9% to 67 points, despite its recent strategic shift from an Internet access service to an ad-supported e-mail and entertainment source. AOL’s customer satisfaction score was only slightly higher than the IRS (the US tax authorities). That’s not a good sign.





