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from @dhh: Ning raised spent $120MM of other people's money over 6 years to come to the conclusion that free doesn't pay.

by dannyr 17y ago

staunch 17y ago
If Ning networks had exploded as they had hoped there wouldn't be any emphasis on paid today. The plan was to have a billion people participating in 10 million different networks. That didn't pan out. If it had worked DHH would have simply said that they're one of the lottery winners.
- Tawheed 17y ago
  Yes, he would have, but he'd also be right, since there are so few that succeed with that model.
- chaosmachine 17y ago
  Would he be wrong, though?
  - borism 17y ago
    I'm stupid, but still not seeing how billion people would have translated into any $ for them...
    - jbooth 17y ago
      Facebook has 300 mil, and they're profitable..
      - borism 17y ago
        profitable? last I've heard they are cash flow neutral, and that's considering how many billions invested?
        mixmax 17y ago
        And they're one of the most visited sites on the planet. They can't hide behind the "We choose growth over revenue" anymore since they're already so huge. If they can't capitalize big-time on the users they have now they have a serious problem.
        pclark 17y ago
        of course they can hide behind that. Optimizing for growth over revenue isn't that unusual. Facebook is still very young.
        lsc 17y ago
        reference? I've heard conflicting reports. edit: did some looking: http://www.businessweek.com/the_thread/techbeat/archives/2009/09/facebook_climbs.html http://www.businessweek.com/the_thread/techbeat/archives/200... " On Tuesday, those concerns were momentarily quieted as Facebook announced that it’s now free cash flow positive. This doesn’t mean the social network is a profitable operation yet. Rather, the cash it generates from advertising and other forms of revenue now exceed the cost of servers and other capital expenditures required to keep Facebook running. One-time costs, like the reported $50 million acquisition of Friendfeed last month, and operational expenses like personnel, are not included in this equation. Outside investments in the company, like the $200 million it raised from Digital Sky Technologies in May, are not accounted for either. " So, it sounds like if they fired everyone and stopped buying stuff, they'd be profitable, if money kept rolling in as it does now. I obviously don't know for sure, but I would guess that servers and bandwidth are cheaper than labour, for a company like facebook.
        netcan 17y ago
        Anecdote: I'm involved in online ad campaigns for a number of medium sized advertisers. I would love for Facebook's advertising program and 'stuff for businesses' to get a bit better. I think I could get several $100 - $1000 budgets. It would be a fraction of what they spend on adwords, initially at least, but still significant.
        17y ago

from @dhh: Ning raised spent $120MM of other people's money over 6 years to come to the conclusion that free doesn't pay.

by dannyr 17y ago

from @dhh: Ning raised spent $120MM of other people's money over 6 years to come to the conclusion that free doesn't pay.

staunch 17y ago

If Ning networks had exploded as they had hoped there wouldn't be any emphasis on paid today. The plan was to have a billion people participating in 10 million different networks. That didn't pan out. If it had worked DHH would have simply said that they're one of the lottery winners.

Tawheed 17y ago
Yes, he would have, but he'd also be right, since there are so few that succeed with that model.
chaosmachine 17y ago
Would he be wrong, though?
- borism 17y ago
  I'm stupid, but still not seeing how billion people would have translated into any $ for them...
  - jbooth 17y ago
    Facebook has 300 mil, and they're profitable..
    - borism 17y ago
      profitable? last I've heard they are cash flow neutral, and that's considering how many billions invested?
      - mixmax 17y ago
        And they're one of the most visited sites on the planet. They can't hide behind the "We choose growth over revenue" anymore since they're already so huge. If they can't capitalize big-time on the users they have now they have a serious problem.
        pclark 17y ago
        of course they can hide behind that. Optimizing for growth over revenue isn't that unusual. Facebook is still very young.
      - lsc 17y ago
        reference? I've heard conflicting reports. edit: did some looking: http://www.businessweek.com/the_thread/techbeat/archives/2009/09/facebook_climbs.html http://www.businessweek.com/the_thread/techbeat/archives/200... " On Tuesday, those concerns were momentarily quieted as Facebook announced that it’s now free cash flow positive. This doesn’t mean the social network is a profitable operation yet. Rather, the cash it generates from advertising and other forms of revenue now exceed the cost of servers and other capital expenditures required to keep Facebook running. One-time costs, like the reported $50 million acquisition of Friendfeed last month, and operational expenses like personnel, are not included in this equation. Outside investments in the company, like the $200 million it raised from Digital Sky Technologies in May, are not accounted for either. " So, it sounds like if they fired everyone and stopped buying stuff, they'd be profitable, if money kept rolling in as it does now. I obviously don't know for sure, but I would guess that servers and bandwidth are cheaper than labour, for a company like facebook.
        netcan 17y ago
        Anecdote: I'm involved in online ad campaigns for a number of medium sized advertisers. I would love for Facebook's advertising program and 'stuff for businesses' to get a bit better. I think I could get several $100 - $1000 budgets. It would be a fraction of what they spend on adwords, initially at least, but still significant.
        17y ago