6 ms·

Bit.ly Raises $10 Million Series B, Still Growing Like Crazy

40 points by aditya 16y ago

dmor 16y ago
does anyone know if they've made a public statement about how they'll deal with the whole .ly domain risk that people have been buzzing about lately?
- aditya 16y ago
  It's just noise: http://www.observer.com/2010/media/bitly-says-libya-scare-bunk-mitt-romney-shut-down-mittly http://www.observer.com/2010/media/bitly-says-libya-scare-bu...
  - meatsock 16y ago
    the article says 'they've got nothing to worry about' in terms of being on a sexual mission but it doesnt rule out an evolution of .ly's opinion of it's stake in the deal, and it seems to me they'd have final say about it. The 'scare' was ly asserting what amounts to their territory, no?
  - InclinedPlane 16y ago
    It's far from just noise. Any company betting its business on a ccTLD needs to have a sane and level-headed understanding of the risks involved. And .ly is one of the riskiest, because it's run by an anti-western, anti-US dictatorship. You may think that because the regime currently supports the continued existence of a particular web business today that they will forever, but the history of such regimes argues that there is a lot of risk in that assumption. The regime may change its mind based on arbitrary criteria. It may decide that bit.ly is no longer in its favors. It may decide to nationalize bit.ly, redirecting the domain to a Libyan owned copy of bit.ly, prepopulated with existing shortened urls gathered from searches. Or, the country may undergo a change of regime. What happens when (not if) Gaddaffi dies (he is already nearly 70)? What happens if the country undergoes another coup? What happens if the country renames itself and gets rid of the old TLD? This use/misuse of ccTLDs for commercial purposes (e.g. .tv, .ly, .it, .co, .to, etc.) is a relatively recent practice, there hasn't been enough time to decide if it's a safe practice or not. It'll likely take only one "disaster" to wake people up to the idea that there is indeed risk to basing your business on the cooperation of a country chosen solely because it has a catchy TLD abbreviation.
  - dotBen 16y ago
    As one of the two (former) owners of vb.ly that got pulled, I'm sure bit.ly is concerned (and should be). Given he was having his investors sign contracts on a $10m Series B investment the same day, I'm not surprised John Borthwick said 'it was just noise' -- I'd have done the exact thing myself. It's what you do as an entrepreneur to get shit done. Doesn't mean it is just noise for them. The peanut gallery have gone to great lengths to tell us Libya is in its right to set whatever rules it likes about domains (and even content of sites), that it is reasonable for Libya to change those rules at any time and that it is even ok for Libya to interpret those laws differently on a case-by-case basis. (wow). So with that in mind, I'd be fairly concerned. Given the way things seem to be going over at NIC.ly I'd be interested to see what kind of arrangement NIC.ly propositions to Bit.ly if/when they decide they no longer like bit.ly linking to depictions of the prophet Mohammed (PBUH) or hardcore pornography. I'm sure they won't simply can the domain but come to some other arrangement (ie financial) to resolve this. And if I was bit.ly, with everything I have in play now, I'd accept rather than have my domain taken away from me and a significant part of my business shut down. It's just business (Internet = Serious Business)
    - evansolomon 16y ago
      This is a small point, but funding doesn't get announced on the day it closes ever. So no one was signing anything related to this deal once the .ly stuff started happening.
- kno 16y ago
  Personally I will not build a business at the mercy of the Libyan government.
  - dmor 16y ago
    I own a pretty awesome .ly domain which I was holding onto for a future business, but I'm definitely reconsidering as well
nir 16y ago
Ask HN: How does growing # of URLs convert to growing business? I have a small app that does the opposite of bit.ly (converts shortened URL to the original ones, adding some info like page title etc). It's also "growing like crazy" - no big deal considering that millions of new URLs are created every day - but it just means more hosting costs for me. Any ideas on how to convert this to revenue instead? (The site is on http://therealurl.appspot.com/ http://therealurl.appspot.com/ )
- mootothemax 16y ago
  The article gives a couple of clues about how bit.ly makes money: Its first source of revenues comes from Bit.ly Pro accounts, which are used by 3,000 companies and another individual 1,000 power users. and The bigger opportunity for bit.ly is in all the data it is harvesting about which links people are sharing in realtime... If you think about it, bit.ly knows what news is breaking because everybody is sharing it. Interesting to think about moneytising the links in this way :-)
  - pchristensen 16y ago
    Not to rain on their parade, but wasn't data mining supposed to make FoxMarks valuable too?
    - mediaman 16y ago
      There are many businesses for whom vague hand-waving about data mining is supposedly a monetization strategy. Most of them don't work, because people forget that not all data is valuable.
    - photon_off 16y ago
      My sentiments. I think that anybody who says "URL popularity data mining is valuable" is just repeating what somebody else said. There are probably 100 services right now that could tell you the hottest 1,000 URLs. Delicious, Google/Yahoo Buzz, any of the dozens of popular bookmarking and social media sites, AddThis.com and their ilk, Quantcast and their ilk, Twitter, any URL shortening service, your ISP, etc. URLs have been currency for a long time now. I hear about this information being valuable all the time, yet I've never once read about any of these companies profiting from knowing the popularity of URLs. I might just be ignorant, so please HN, tell me who is paying for a list of popular URLs?
iamjustlooking 16y ago
How do you even begin to make a return on this money? Put redirects in a frame and put an ad in? Charge for some sort of premium service and hope people don't go to one of many other url shortening services?
- msbarnett 16y ago
  Presumably they're hoping to monetize the data they're harvesting, with things like the mentioned social news site. How realistic it is that that will be a home run for them, I'm not sure.
  - prawn 16y ago
    Plus white-labelled services.
    - msbarnett 16y ago
      I wonder how much money there is in that. For organizations that want a vanity shortener but have no in-house IT resources it might have some appeal, but it seems like it would be a very cheap, simple thing to do in house in all other cases.
      - prawn 16y ago
        I have a rudimentary shortener that I use for a couple of personal things (http://linky.com.au http://linky.com.au) and agree that, to some point, they're pretty trivial to create. But at some level of complexity in functionality, reporting, etc it'd have to be attractive to people to just make use of another service. e.g., we can build a newsletter system that is OK, but the bang for buck that MailChimp provides is greater and so we often recommend that to clients.
- dotBen 16y ago
  Also this is an example of where it is reasonable to build out a service that is itself a feature but a valuable one for a potential acquirer. If AOL, Microsoft, etc wanted to set up a url shortener, it might be worth their while simply obtaining the technical infrastructure, domain knowledge of the staff, business deals and of course all the existing links + data then to just start their own from scratch. (Mind you having taken $14m-$15m that does now make it an expensive aquisition. I'd have thought it a no brainer for the AOL/Microsoft/Yahoo's to pick up bit.ly for $20-$40m)
edash 16y ago
This is great PR. I'd be willing to bet this fundraising announcement was fast-tracked to counter the whole ".ly is unsafe" story from the past few days. http://news.ycombinator.com/item?id=1763431 http://news.ycombinator.com/item?id=1763431
ajkirwin 16y ago
"it could create relevant, topical ad units which themselves get inserted into the realtime stream in the form of Tweets, status updates or whatnot." Fuck RIGHT off.
justinchen 16y ago
Does anyone use bit.ly pro? Any other white-label url shorteners people recommend? http://shortswitch.com http://shortswitch.com looks pretty decent.
wave 16y ago
I run un-shortening service called http://unshort.me http://unshort.me which is getting about 200K API requests/day. Sample of 1,000,000 requests from the service: bit.ly 612,170 tinyurl.com 55,091 goo.gl 41,812 ow.ly 35,531 is.gd 29,533 t.co 26,043 j.mp 21,172 other 178,648
- techbio 16y ago
  From the horse's mouth--do you see an organic access pattern in the resolved URLs, as a shadow of the popularity? Or are most of the 200K API requests batch processes?
- adrianwaj 16y ago
  What shortener would you suggest others use?
- michaelbuckbee 16y ago
  The service in there that surprised me was Google's. While the chrome shortener extension has been out for a while it wasn't officially announced until last week. Given that the big value add (beyond white labeling) that is being provided by these services is analytics tracking I'd be deeply concerned about a new URL shortener run by the same company with the dominant web analytics package. It's only a matter of time until goo.gl stats are displayed within Google analytics and when that hits I wonder how many will stay with the current shortener services.
hristov 16y ago
Anybody know what it is about the pro account that makes it worth paying for?
krelian 16y ago
I would have only taken 1 million to tell them it's a bad investment. This whole URL shortening business is so pathetic. OK, so twitter decided to be SMS compatible and limit messages to 140 characters, so what? It's an arbitrary limit attached to a standard that has already reached it's peak and can only go down from here. With 3G and smartphones becoming ubiquitous less and less people are going to be using sms for their messaging and the need to limit messages to 140 characters will diminish. It's a waining market not a startup opportunity.
- rokhayakebe 16y ago
  It's the data that is valuable, what people are interested in.
shaggy 16y ago
I really don't understand how shortening URLs is a viable business model? $10 million dollars is an enourmous sum of money to invest for something that provides almost no substantive value. That money would be better invested in software that allows (forces would be better) to design sane and usable URI schemes.
- shin_lao 16y ago
  I agree. We built one as a proof-of-concept around our post-modern database engine. It costs orders of magnitude less than $ 10,000,000. I don't understand why they need that much money. We could probably monetize it (advertisement on the main page) to the point of not having it costs us money to run it, but since it's more a promotional platform than a business... (if you're curious: http://wrp.me/ http://wrp.me/).

40 points by aditya 16y ago

dmor 16y ago

does anyone know if they've made a public statement about how they'll deal with the whole .ly domain risk that people have been buzzing about lately?

aditya 16y ago
It's just noise: http://www.observer.com/2010/media/bitly-says-libya-scare-bunk-mitt-romney-shut-down-mittly http://www.observer.com/2010/media/bitly-says-libya-scare-bu...
- meatsock 16y ago
  the article says 'they've got nothing to worry about' in terms of being on a sexual mission but it doesnt rule out an evolution of .ly's opinion of it's stake in the deal, and it seems to me they'd have final say about it. The 'scare' was ly asserting what amounts to their territory, no?
- InclinedPlane 16y ago
  It's far from just noise. Any company betting its business on a ccTLD needs to have a sane and level-headed understanding of the risks involved. And .ly is one of the riskiest, because it's run by an anti-western, anti-US dictatorship. You may think that because the regime currently supports the continued existence of a particular web business today that they will forever, but the history of such regimes argues that there is a lot of risk in that assumption. The regime may change its mind based on arbitrary criteria. It may decide that bit.ly is no longer in its favors. It may decide to nationalize bit.ly, redirecting the domain to a Libyan owned copy of bit.ly, prepopulated with existing shortened urls gathered from searches. Or, the country may undergo a change of regime. What happens when (not if) Gaddaffi dies (he is already nearly 70)? What happens if the country undergoes another coup? What happens if the country renames itself and gets rid of the old TLD? This use/misuse of ccTLDs for commercial purposes (e.g. .tv, .ly, .it, .co, .to, etc.) is a relatively recent practice, there hasn't been enough time to decide if it's a safe practice or not. It'll likely take only one "disaster" to wake people up to the idea that there is indeed risk to basing your business on the cooperation of a country chosen solely because it has a catchy TLD abbreviation.
- dotBen 16y ago
  As one of the two (former) owners of vb.ly that got pulled, I'm sure bit.ly is concerned (and should be). Given he was having his investors sign contracts on a $10m Series B investment the same day, I'm not surprised John Borthwick said 'it was just noise' -- I'd have done the exact thing myself. It's what you do as an entrepreneur to get shit done. Doesn't mean it is just noise for them. The peanut gallery have gone to great lengths to tell us Libya is in its right to set whatever rules it likes about domains (and even content of sites), that it is reasonable for Libya to change those rules at any time and that it is even ok for Libya to interpret those laws differently on a case-by-case basis. (wow). So with that in mind, I'd be fairly concerned. Given the way things seem to be going over at NIC.ly I'd be interested to see what kind of arrangement NIC.ly propositions to Bit.ly if/when they decide they no longer like bit.ly linking to depictions of the prophet Mohammed (PBUH) or hardcore pornography. I'm sure they won't simply can the domain but come to some other arrangement (ie financial) to resolve this. And if I was bit.ly, with everything I have in play now, I'd accept rather than have my domain taken away from me and a significant part of my business shut down. It's just business (Internet = Serious Business)
  - evansolomon 16y ago
    This is a small point, but funding doesn't get announced on the day it closes ever. So no one was signing anything related to this deal once the .ly stuff started happening.
kno 16y ago
Personally I will not build a business at the mercy of the Libyan government.
- dmor 16y ago
  I own a pretty awesome .ly domain which I was holding onto for a future business, but I'm definitely reconsidering as well

nir 16y ago

Ask HN: How does growing # of URLs convert to growing business? I have a small app that does the opposite of bit.ly (converts shortened URL to the original ones, adding some info like page title etc). It's also "growing like crazy" - no big deal considering that millions of new URLs are created every day - but it just means more hosting costs for me. Any ideas on how to convert this to revenue instead? (The site is on http://therealurl.appspot.com/ http://therealurl.appspot.com/ )

mootothemax 16y ago
The article gives a couple of clues about how bit.ly makes money: Its first source of revenues comes from Bit.ly Pro accounts, which are used by 3,000 companies and another individual 1,000 power users. and The bigger opportunity for bit.ly is in all the data it is harvesting about which links people are sharing in realtime... If you think about it, bit.ly knows what news is breaking because everybody is sharing it. Interesting to think about moneytising the links in this way :-)
- pchristensen 16y ago
  Not to rain on their parade, but wasn't data mining supposed to make FoxMarks valuable too?
  - mediaman 16y ago
    There are many businesses for whom vague hand-waving about data mining is supposedly a monetization strategy. Most of them don't work, because people forget that not all data is valuable.
  - photon_off 16y ago
    My sentiments. I think that anybody who says "URL popularity data mining is valuable" is just repeating what somebody else said. There are probably 100 services right now that could tell you the hottest 1,000 URLs. Delicious, Google/Yahoo Buzz, any of the dozens of popular bookmarking and social media sites, AddThis.com and their ilk, Quantcast and their ilk, Twitter, any URL shortening service, your ISP, etc. URLs have been currency for a long time now. I hear about this information being valuable all the time, yet I've never once read about any of these companies profiting from knowing the popularity of URLs. I might just be ignorant, so please HN, tell me who is paying for a list of popular URLs?

iamjustlooking 16y ago

How do you even begin to make a return on this money? Put redirects in a frame and put an ad in? Charge for some sort of premium service and hope people don't go to one of many other url shortening services?

msbarnett 16y ago
Presumably they're hoping to monetize the data they're harvesting, with things like the mentioned social news site. How realistic it is that that will be a home run for them, I'm not sure.
- prawn 16y ago
  Plus white-labelled services.
  - msbarnett 16y ago
    I wonder how much money there is in that. For organizations that want a vanity shortener but have no in-house IT resources it might have some appeal, but it seems like it would be a very cheap, simple thing to do in house in all other cases.
    - prawn 16y ago
      I have a rudimentary shortener that I use for a couple of personal things (http://linky.com.au http://linky.com.au) and agree that, to some point, they're pretty trivial to create. But at some level of complexity in functionality, reporting, etc it'd have to be attractive to people to just make use of another service. e.g., we can build a newsletter system that is OK, but the bang for buck that MailChimp provides is greater and so we often recommend that to clients.
dotBen 16y ago
Also this is an example of where it is reasonable to build out a service that is itself a feature but a valuable one for a potential acquirer. If AOL, Microsoft, etc wanted to set up a url shortener, it might be worth their while simply obtaining the technical infrastructure, domain knowledge of the staff, business deals and of course all the existing links + data then to just start their own from scratch. (Mind you having taken $14m-$15m that does now make it an expensive aquisition. I'd have thought it a no brainer for the AOL/Microsoft/Yahoo's to pick up bit.ly for $20-$40m)

edash 16y ago

This is great PR. I'd be willing to bet this fundraising announcement was fast-tracked to counter the whole ".ly is unsafe" story from the past few days. http://news.ycombinator.com/item?id=1763431 http://news.ycombinator.com/item?id=1763431

ajkirwin 16y ago

"it could create relevant, topical ad units which themselves get inserted into the realtime stream in the form of Tweets, status updates or whatnot." Fuck RIGHT off.

justinchen 16y ago

Does anyone use bit.ly pro? Any other white-label url shorteners people recommend? http://shortswitch.com http://shortswitch.com looks pretty decent.

wave 16y ago

I run un-shortening service called http://unshort.me http://unshort.me which is getting about 200K API requests/day. Sample of 1,000,000 requests from the service: bit.ly 612,170 tinyurl.com 55,091 goo.gl 41,812 ow.ly 35,531 is.gd 29,533 t.co 26,043 j.mp 21,172 other 178,648

techbio 16y ago
From the horse's mouth--do you see an organic access pattern in the resolved URLs, as a shadow of the popularity? Or are most of the 200K API requests batch processes?
adrianwaj 16y ago
What shortener would you suggest others use?
michaelbuckbee 16y ago
The service in there that surprised me was Google's. While the chrome shortener extension has been out for a while it wasn't officially announced until last week. Given that the big value add (beyond white labeling) that is being provided by these services is analytics tracking I'd be deeply concerned about a new URL shortener run by the same company with the dominant web analytics package. It's only a matter of time until goo.gl stats are displayed within Google analytics and when that hits I wonder how many will stay with the current shortener services.

hristov 16y ago

Anybody know what it is about the pro account that makes it worth paying for?

krelian 16y ago

I would have only taken 1 million to tell them it's a bad investment. This whole URL shortening business is so pathetic. OK, so twitter decided to be SMS compatible and limit messages to 140 characters, so what? It's an arbitrary limit attached to a standard that has already reached it's peak and can only go down from here. With 3G and smartphones becoming ubiquitous less and less people are going to be using sms for their messaging and the need to limit messages to 140 characters will diminish. It's a waining market not a startup opportunity.

rokhayakebe 16y ago
It's the data that is valuable, what people are interested in.

shaggy 16y ago

I really don't understand how shortening URLs is a viable business model? $10 million dollars is an enourmous sum of money to invest for something that provides almost no substantive value. That money would be better invested in software that allows (forces would be better) to design sane and usable URI schemes.

shin_lao 16y ago
I agree. We built one as a proof-of-concept around our post-modern database engine. It costs orders of magnitude less than $ 10,000,000. I don't understand why they need that much money. We could probably monetize it (advertisement on the main page) to the point of not having it costs us money to run it, but since it's more a promotional platform than a business... (if you're curious: http://wrp.me/ http://wrp.me/).