Archive for the ‘strategy’ Category

Niklas Zennstrom is a Genius

Tuesday, June 19th, 2007

A limited number of first-time entrepreneurs hit it big and sell their company for millions. Some might call this luck. Less frequently is an entrepreneur able to replicate this feat and sell a second company for a considerable amount. Almost never is one able to do this for a third time. At this point, luck cannot be taken into consideration - a formula has been established.

Niklas Zennstrom co-founded both KaZaA and Skype, two wildly popular Internet successes. He’s on his way to a third success - maybe his biggest yet - with Joost.

A great article was published by BBC the other day. It profiled the mindset and thought process of Zennstrom. This Swedish genius is THE disrupter among disruptive technology disrupters. He identifies an industry with problems and short-comings, then launches a company in an all-out attack. In particular, he has a keen interest in the Internet communication and media areas, as all of his disrupters have spawned from these realms. Here is a simple breakdown:

  • Music - KaZaA
  • Telephone - Skype
  • TV - Joost

What’s next? Something in the radio industry - along the lines of or Pandora?

On a side note, his luck with five-letter company names is almost uncanny. Superstition? Strategy? Coincidence? Only Zennstrom really knows.

One thing is for sure. Zennstrom likes being in a position of power. He likes disrupting. Some might call him the shit-disturber of the online world. He is quoted as saying:

“For me, a disruptive technology is only worthwhile if it gives people something they didn’t have or couldn’t do before.”

His motivation and determination are inspirational. He conquers one area, then moves on to another - methodically and systematically. His quest to make things “faster, lighter, or cheaper” is a main driver and source of energy. His never-ending search for the next ‘big thing’ has never been centered around a given product or area, but rather a mentality. Simply put, he wants to give regular consumers a better way of doing something they’re already doing. Thus, he is not looking to re-invent the wheel - just expand upon it.


Directories - What the Web Should Be

Thursday, June 14th, 2007

Directory structureI know I rant about certain topics to no end, but there are certain things I feel passionate about. The semantic web is one of them. I glorify links and a static web. I’m boring and lame. Call me Mr. Web 1.0. Having said that, I focus on simplicity and a stream-lined user experience. Practicality and logic are two ideals that I admire when perusing a site.

Directories are a great business model. They have a built-in:

  • revenue model (i.e. premium listing)
  • marketing mechanism (i.e. SEO)

The hierarchical nature of the system makes it easy for users to find what they are looking for. Furthermore, this set-up also facilitates search engine crawling, ensuring that all pages are indexed.

Directories fulfill all the requirements of a site well-optimized for search engines. Page titles, URLs (in many cases), META tags, headers, page content, and anchor text are all well-described by default.

Directories are also ideal for anything ‘local’. Regional sites have proven the model. The YellowPages and online classified ad sites, like Craigslist, function much in the same way. They are useful to the non-techie and provide offline value.

I find directories to be similar to forums and discussion boards from a user-participation stand-point. They both rely highly on social media and “crowd-sourcing” to aggregate content and data. Users and site visitors are submitting info to add value to the site or discussion, or to provide exposure for a given cause. In any case, the directory ’system’ takes care of the work, leaving little human labour to deal with site functionality. This allows the site to scale with very little additional manpower or resources needed. It is automatic.

So next time you’re conjuring up an idea for a web business, forget the ’sexy’ social networks and web 2.0 hype. Think simple, think straight-forward, think directories.

Is AJAX all It is Hyped to be?

Tuesday, June 12th, 2007

The coming of the new-web brought with it a bucket of buzz words and terms. Among them: podcast, RSS, wikis, VOIP, blog, widgets, and of course, AJAX. Some are relevant, while others are simply fads with no long-term potential. AJAX, for one, has been a term buzzing around the development community. The combination of asynchronous JavaScript and XML forms a powerful, interactive experience by increasing usability and saving time.

Don’t get me wrong… I am not an expert in the area. Programming is definitely not my schtick. But from a non-techie perspective, I see a definite problem. A large majority of websites nowadays generate revenues via advertising. In other words, they are looking to maximize their number of page views. In the case of AJAX, a page load is not needed to perform a given action or task. Do you see what is missing here?

Why would Internet Company A want to use AJAX if it is going to decrease page views, thus decreasing revenues? It doesn’t make sense. So Internet Company A may want to stay away from this web development technique. This may mean that the user is unable to experience the site at its utmost potential.

Furthermore, another problem often overlooked is around browsing and navigation. If I alter, edit, or modify an AJAX-driven page, then hit the “Back” button on my browser, I jump back to a previous page - not my previous edit or change. This causes some anxiety among users. One could also argue that issues regarding URLs may pose problems as well.

Nonetheless, the technique does have its positive as mentioned above. The decrease in bandwidth utilization, increased interactivity, and more fulfilling user experience create an environment that is perfect for some web applications.

I guess what I am saying is that every company should assess whether or not AJAX is a good fit with their experience before deciding to implement it. 

Do you think AJAX has long term sustainability or is it simply a fad?

“Getting Real” with 37signals

Monday, June 11th, 2007

37signals logo37signals has solified itself among the elite providers of simple, clean, web-based apps on the Internet. I have spoken very highly of the company in the past and many have expressed the same views. Not only is the firm popular for its products, but also many other things including:

In addition, many may also be aware that 37signals has launched a popular book about how to build a successful web-based application. This book is $19 for the PDF version, $29 for the paperback edition, or best of all - FREE if you want to read the online version.

If you are currently working on a web-based start-up or plan on doing so in the near future, this read is a MUST. I cannot recommend it enough. The outline, as well as the principles and concepts, are easy-to-understand and simple to implement, although many fail to do so. By carefully reading this wonderful bit of text, you will no doubt better position yourself (and company) for success.

Here is a break-down of the book:

  • 16 chapters
  • 91 essays
  • Under 200 pages

The book walks you step-by-step through pre-launch, launch, promotion, support, and even post-launch, ensuring successful progression along the way. It is available in numerous languages and is a very easy read. I will leave you with Seth Godin comments about the book:

“Every once in a while, a book comes out of left field that changes just about everything. This is one of those books. Ignore it at your peril.”

Domain Investing is Virtual Real Estate

Thursday, June 7th, 2007

Individuals who partake in the buying and selling of domain names are called “domainers”. These individuals can also create revenues by generating traffic to the given properties, then maxizing the ad revenue per page view. By producing tailored landing pages and optimizing for search engines, the influx of traffic can be constant and ongoing, creating a flow of income.

The former tactic sounds very similar to the real world and real estate investing. Essentially, they are the same thing. In either case, the investor is purchasing some ‘property’ in hopes that it will increase in value. Subsequently, a sale will produce a capital gain. 

Many of these investors possess comprehensive portfolios of domain names, containing tens of thousands of names or more. The names range from high-end .com properties to smaller, more niche, long tail offerings. As mentioned above, these fortune-seekers can generate revenue not only via a sale, but also via traffic.

World famous domainers include:

  • Yun Ye - probably the most famous domainer; Vancouver man who sold this 100,000+ domain portfolio to Marchex for $164 million in 2004
  • Frank Schilling - his sites apparently generate 1% of all Yahoo ad revenues, or over $30 million a year
  • Rick Schwartz - multi-millionaire who turned $1,800 into over $20 million; has owned such domains as and

The domain investing world is a very interesting space that I would like to learn more about. It is a very underground, low profile industry due to its (sometimes) unethical and shifty nature. In any case, it is captivating and opens your mind to a whole new world of business on the Internet.

Note: I would highly recommend reading this article on domain investing. It is not only entertaining, but very educating.