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Amazon had a business model from day 1. I don't think they really apply to this conversation. They weren't profitably early on, but that's way different from no
by fallentimes 18y ago
Amazon had a business model from day 1. I don't think they really apply to this conversation. They weren't profitably early on, but that's way different from not having business model.
"Among the biggest internet companies, most of them followed this strategy."
You could be right, but I honestly have no idea. What sources are you using? How are you measuring this?
"It paid back the purchase price in the first year!"
Wait, what? Revenue or profit? Revenue > Acquisition Cost != success.
"They are clear success stories for the founders though."
Definitely, which is probably the most important thing of all.
- emmett 18y agoFrom the Alexa top 20 global (http://www.alexa.com/site/ds/top_sites?ts_mode=global&lang=none http://www.alexa.com/site/ds/top_sites?ts_mode=global&la...): Yahoo - users before revenue, success Google - users before revenue, success YouTube - users before revenue, undecided Microsoft - revenue before users, although their internet properties consistently lose money. Not really an internet company. MySpace - users before revenue, success (MySpace is profitable already) Facebook - users before revenue, undecided Blogger - users before revenue, probably a success although google doesn't release numbers so it's hard to say how much money they make on it Orkut - same as Blogger RapidShare - users before revenue, success (very profitable freemium model) Baidu - I'm not sure. I presume they follow the same path as Google did, but with an obvious example of how to succeed already in place. QQ - users before revenue, success (virtual goods turn out to be a great way to monetize a free chat product in China) eBay - revenue before users; they didn't make auctions free Hi5 - users before revenue, undecided In addition to being the biggest internet companies, these are among the most profitable. Several of the top 20 were acquired by other companies, making it difficult to judge how successful they would be independently. Several are still so new it's hard to tell. There's exactly one which took money over user growth (eBay).
- fallentimes 18y agoNot sure it's statistically significant, but very insightful overview - thank you. One quick nitpick: I'd argue Rapidshare had a business model before users, even if it technically had users before revenue.
- dmoney 18y agoYour comment makes the page scroll horizontally. It's bad Feng Shui.