Wazap! and German innovation

Germany, Internet, Red Herring, conferences, entrepreneurs, general, general technology 10 August 2007


There’s been a bitter debate going on in TechCrunch about German Internet start-ups. The argument is that companies like Verwandt.de don’t innovate. They simply clone US start-ups (even cloning the interface and features). In TechCrunch’s words:

Germany is starting to build a name for itself as the startup cloning capital of the world. German clones of popular U.S. services keep popping up. Twitter (Frazr, Dukudu). and Facebook (Studi.vz) are two recent examples. TechCrunch contributor Gregor Hochmuth termed these German clones Copy/Paste innovation.

Business 2.0 (in its print edition) has jumped into the fray, coming up with its list of cloned US start-ups (though TechCrunch notes that there are gross inaccuracies in the story).

I think that the debate is kind of silly and xenophobic. Of course, everyone borrows ideas from everyone else. Pepsi borrowed from Coca Cola. Burger King borrowed from McDonalds. Microsoft and Apple borrow from each other and from everyone else. And Google was the 12th search engine to launch, 5 full years after the 1st search engine. Its successful business model is based on technology originally created by Overture. (Google settled a patent lawsuit filed by Overture in 2005 by issuing stock to Yahoo! (which bought Overture) in return for a perpetual license.)

What’s more, some of the comments are downright racist with references to Hitler and gas chambers. That’s unacceptable. Isn’t the point of moderating comments to remove offensive speech that doesn’t contribute substance to a discussion? It’s a bit disappointing to see that TechCrunch would allow such comments to be posted.

In any case, as an Internet entrepreneur who was admittedly inspired by the innovations coming out of Silicon Valley, I’d say that all of the European classifieds vertical search engines have probably borrowed ideas (including the concept of vertical search itself) from Trulia, Simply Hired, Oodle and Indeed, which were in turn inspired by each other and from Google, ASK, Microsoft and Yahoo, all of which borrow ideas and innovations from each other.

Technology is a circle of innovation, inspiration and borrowing.

But the mere fact of coming later doesn’t mean that your product is inherently less valuable. Again, Google was the 12th search engine to launch!

It’s okay that innovation and invention are not the same things. Both are valuable in creating successful companies. The concept of building upon someone else’s invention (or someone else’s innovation, as the case might be) is a good thing that should be promoted, both within a country’s boundaries and internationally. This doesn’t mean that I support “Copy/Paste innovation”, but it does mean that it might be unfair to target Germans (or Europeans generally) as particularly susceptible to this phenomenon.

After all, the World Wide Web was created by a Brit, not an American, even though Americans first exploited the Internet’s commercial possibilities.

Wazap!

And it’s a German that is currently tearing up the online traffic charts with an innovative product that is definitively not a clone of any US start-up. I’m talking about my friend, Andreas Rührig, founder and CEO of Wazap!, one of the most successful vertical search engines our there.

andreas-ruhrig.jpg

Andreas’ success makes sense.

He is one of the smartest, most experienced and most innovative Internet entrepreneurs out there, even though he’s not American. (Take that, TechCrunch!) ;)

We met at Red Herring when he came up to us after our presentation and said: “I think that you guys should focus on only one vertical to start.” We had a nice chat on SKYPE yesterday, and I reminded him of that initial conversation. I’d never asked him what made him come up to us to offer that feedback, so I inquired yesterday. His answer: “It was just a hunch.”

Of course, as I mentioned in an earlier post, we’ve since come around to his way of thinking after hearing it repeated by various influential tech analysts. And I’ve learned that Andreas generally has good hunches, driven by years of experience and success in the Internet space (both within Germany and internationally). I’ve been privileged enough to contact him occasionally to brainstorm about strategic questions and to understand the German Internet and media markets better.

A few facts about Andreas:

  • Only 30 years old, Andreas is already a successful serial entrepreneur. Wazap! is his third Internet company.
  • Andreas founded his first company, Gamez.de in December 1999. It became the biggest gaming community in Europe and he sold the company only 6 months later. The company later IPOed in France.
  • Andreas sold his first two successful Internet gaming companies, including Gamez.de, for a combined $60 million.

A few facts about Wazap!

  • As CEO of Wazap!, Andreas has successfully launched the vertical search engine in Germany, Japan (their biggest market), China and, most recently, in the United States (the biggest gaming market of them all).
  • Wazap! has raised about $12 million in funding from two German VCs. The last $7.9 million was for the US launch.
  • Wazap! is the most successful gaming vertical search engine in the world, with more than 16 million unique users per month and 250 million page views.
  • The company was started in June 2004 but already had revenue of more than $1 million by 2006.

All I can say is “Wow”.

Congrats to Wazap! and to Andreas. It’s great to see a vertical search engine doing well internationally, and Wazap is a great example of an innovative German start-up that is definitively not a copy of a US product. 16 million unique users per month! That’s an amazing achievement, and a lot of hard work given that they compete directly with Yahoo and Google (and given that Google generally punishes other search engines in terms of organic search rankings).

They must be doing something right!

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