8 ms·

Betaworks has acquired the core assets of Digg

251 points by mikerice 14y ago

uptown 14y ago
From WSJ: "The price was just $500,000, three people familiar with the matter said—a pittance for a company that raised $45 million from prominent investors including LinkedIn founder Reid Hoffman and Marc Andreessen." http://online.wsj.com/article/SB10001424052702304373804577523181002565776.html?mod=wsj_share_tweet http://online.wsj.com/article/SB1000142405270230437380457752...
- samstave 14y ago
  WOW That is nothing! I am installing cisco switch gear as we speak that s worth more than that!
  - slig 14y ago
    For a 4-letter domain I say it's quite a bit.
    - majorlazer 14y ago
      Digg is ranked 192 on Alexa. Its Google Page Rank is 8. And the name is very popular and it used to have a huge following. Once the media get's a hold of this story (well it already has), tons of people will visit it just to see what they do with it. Plus, they still have a ton of traffic, of course not as much as they used to.
    - samstave 14y ago
      True, I hadn't thought of the domain acquisition, but thats because digg is effectively dead to me. I can't think of any service that could be built out that will benefit from that domain name though, s even for a four letter domain - I think they threw $500K down the tubes.
- akanster 14y ago
  That WSJ article attributes Digg's fall from grace to "rivals like Facebook Inc. and Twitter Inc." and makes no mention of the Digg v4 redesign disaster. That was what did them in more than anything. EDIT: The story has been updated with a new paragraph, "A series of redesigns..."
  - speg 14y ago
    It was going downhill long before v4 IMO.
    - BiWinning 14y ago
      There was point, years before the v4 redesign, where 90% of the content hitting the front-page was supplied by 100 or so so-called "power users". Of that 90%, probably 40% was supplied by Mr. Baby Man himself. Hitting the frontpage was an impossibility unless you went around friending other users and building up your network. A worthwhile investment if you were doing social media professionally but for the average user they had no voice except in a comments section. After I realized this I moved onto reddit and never looked back. Of course reddit has suffered it's own unique set of consequences from becoming the kid on the block.
    - michaelhoffman 14y ago
      Agreed, but for many (including myself), the Digg v4 fiasco was the last straw, and there was an organized exodus of users at that point.
    - mcbutterbunz 14y ago
      Yes it was. Remember the digg bar? http://en.wikipedia.org/wiki/Digg#Digg_Bar http://en.wikipedia.org/wiki/Digg#Digg_Bar
  - jshen 14y ago
    digg had reached a local maximum prior to v4 that wasn't sufficient for the amount of money they had raised.
- lbarrow 14y ago
  The WSJ's failure to mention reddit speaks to how little they know about the situation beyond the numbers.
  - Stenerson 14y ago
    "Newer social news website such as Reddit Inc. also stole some of Digg's thunder. Last December, Reddit drew more visitors than Digg for the first time, according to comScore, and since then it has maintained that lead."
- landonhowell 14y ago
  $500K? I cant still remember the first time I saw this cover: http://workbench.cadenhead.org/media/businessweek-kevin-rose-digg-cover.png http://workbench.cadenhead.org/media/businessweek-kevin-rose...
- blo 14y ago
  $500K is a steal for a well-known brand, and 2M-4M monthly US visitors (funny how Compete reports higher traffic vs. Reddit while Quantcast reports 1/4x the traffic of Reddit)
- runn1ng 14y ago
  "None of Digg's remaining employees will join Betaworks as part of the acquisition." what did they acually buy? The know how? The technology? None of that is revolutionary today. And there is no community on digg right now whatsoever (unlike /. which still lives its own life). Maybe the name is worth something, but I don't really think that it matters that much.
  - fasouto 14y ago
    Well, Digg still have a lot of visitors, is a well-known page with high PageRank (8). So for only 500.000, I consider it a good deal.
  - ig1 14y ago
    7 million uniques a month disagree.
  - unreal37 14y ago
    The domain name and brand recognition. For $500K, cheap.
    - vaksel 14y ago
      yeah, something shady must be going on. My guess is that you'll find similar people on Digg's and News.me boards. And this was just a way to a) write off Digg as a permanent loss off the books and b) transfer those assets cheaply to the other company, which might boost them from being a loser to being a winner Noone sells Digg for $500K...not unless they are millions and millions in debt
- lifeisstillgood 14y ago
  Just to clarify - they raised 45m So either they spent 45m in past 4 years, or they did not draw down all of it or someone paid 1/2m for 10m in the bank? Or am I fundamentally missing something obvious
  - adventureful 14y ago
    I'd wager they spent it. Crunchbase reports they had 60 employees at some update in the past, so it was probably higher than that at the peak. 60 employees alone probably cost them $6 to $8 million per year depending on all the perks. You could easily vaporize $25 to $35 million over four years in San Francisco on 60 employees. But keep in mind that $45 million wasn't raised in the past four years. On 9/08 they raised $28.7 million, and then another $5 million on 7/11. So they've raised $33.7m over the last four years.
- tptacek 14y ago
  It "feels" like a reasonable shorthand for company outcomes is: an outcome is either (a) a categorical success for the investor, or (b) might as well be written off entirely. With that feeling in mind, the fact that the acquisition was for $500k and not $1MM or $10MM or $40MM is irrelevant: any number falling outside bucket (a) is a loss. And you don't get into venture capital without being able to metabolize a loss. The people that plowed money into Digg had a charter to put ~$45MM at risk. That was their job: find a place for $45MM to live and, probably, die. One major investment in 10 generates a win that pays for the other 9. So: fuck it, right?
fein 14y ago
I am incredibly skeptical about the plausibility of resurrecting Digg, but for 500k I sure hope they do. It was my first social media home and it would be nice to be able to go back to what it was; not a marketing front end for corporate prostitution. Fingers crossed, but betaworks seems to want to take Digg in the direction it should have gone during the v2->v3 upgrade.
- samstave 14y ago
  Not a hope. And the fact that they are going to fold it into news.me to send links of articles that others are reading sounds retarded.
  - fein 14y ago
    Oh damn, if they integrate that into news.me, they've shot themselves with a $500,000 proverbial bullet in the proverbial foot. At this point Reddit can probably not be killed. The only hope that betaworks could have at success is a vanilla relaunch of Digg, minus the gaming problems and "advertising for hire" functionality. Remember Digg when Dragon Age: Origins came out?
CubicleNinjas 14y ago
How the mighty have fallen...
zinssmeister 14y ago
the german Digg clone Yigg.de also sold today. Funny how that timing works out. (http://yigg.de/nachrichten/2012/07/12/ekaabo-uebernimmt-yigg http://yigg.de/nachrichten/2012/07/12/ekaabo-uebernimmt-yigg)
PaulHoule 14y ago
the trouble is that fixing Digg means getting rid of the existing user base
- SwellJoe 14y ago
  What existing user base?
  - PaulHoule 14y ago
    the people that vote up lots of awful content I can't stand looking at
    - SwellJoe 14y ago
      Spammers spamming spammers.
- underdown 14y ago
  Ya, Kevin & Jay tried that back in 2006 - worked out real well for them.
  - PaulHoule 14y ago
    they gotta get them to sign a statement that they'll click on ads
jgroome 14y ago
> The News.me team will take Digg back to its essence: the best place to find, read and share the stories the internet is talking about. Right now. With my cynicism hat on nice and tight, it seems a bit late for that. Digg WAS, in its heyday, the best place to find and share online content. But as the management undertook on iffy decision after another, and as imitators sprung up left right and centre, it lost its place in the online world. Sad. We have plenty of content aggregators now. The kind of people Digg 5.0 (?!) will target are probably more than happy finding their entertainment through Twitter, Facebook, and dare I say it, Reddit. Having said that, I for one wish the new team all the luck in the world in trying to get the site back to its former glory, and I look forward to trying it out.
- sharkweek 14y ago
  I've got my reddit page nice and customized so I see exactly what I'm interested in appear on the front page every morning through specific subreddits I come to HN for a bit more focused conversation on industry related stuff I don't think Digg really has a place anywhere between those two
- citricsquid 14y ago
  There is always room for a better content aggregator, reddit etc. all have their own set of flaws and problems. If the Betaworks team have the ideas to make a great content aggregator then purchasing the Digg brand is absolutely brilliant. The hard part of launching a new site is traction, if they can launch with "the new Digg" (and the site is impressive) that $500k will be the best $500k they could possibly spend on marketing. Techcrunch, Mashable, Reddit... it would be the front page of everywhere, "Digg crashed and burned and after being bought for $500k it's back and it's amazing!", hell maybe even CNN and the BBC would cover it. Not only that they have the entire userbase of Digg to market their new site to. A social news site biggest problem is getting users; this solves that problem (and them some) If we assume that instead of the thought process being "We can have Digg for $500k... should we do it?" the thought process was actually: "We have this brilliant idea for content aggregation, how can we most effectively implement and market this?" then it sounds like a much safer and sensible thing to do.
- hello_asdf 14y ago
adventureful 14y ago
The only reason it's $500k and not $0 is to save a small amount of face. Digg is losing money, and has never made money in its entire history, so it's going to cost Betaworks a lot more than $500k to take it over.
- SwellJoe 14y ago
  Digg bleeds money because they're overstaffed for what they do. Reddit ate their lunch with five paid people, while Digg was employing dozens. I think they had over 100 people on staff at their peak. Even now, when reddit has an order of magnitude more traffic than Digg ever had (1 billion+ pageviews a month), reddit runs with a staff of about 10 people. Digg probably still has a whole lot of dead weight, even at this point when the whole thing is only worth two and a half good developers salaries.
  - adventureful 14y ago
    Absolutely agree. Digg should be run by 3 to 5 people tops at its current size. It'll still cost more than $500k to transition the service to whatever it is they have in mind. It'll probably cost more than $500k just to trim Digg down to size.
  - earl 14y ago
    Yeah, but reddit appears to have been staffed with employees who worked all hours of the night and day for a salary; see blog posts from before reddit gold. That's not sustainable and unless you have a line on a set of really smart suckers who want to work way too much for the same money then can get elsewhere working half the hours or on call... you need more employees.
    - SwellJoe 14y ago
      Two points: 1. I don't think that people, working all hours, are actually significantly more productive than those working regular hours. In fact, in knowledge work, there's good evidence that you only get two or three hours of real productivity per day, no matter how long you keep banging your head on the keyboard. 2. Even if reddit developers and staff were twice as productive as Digg folks, that only indicates that Digg had five times too many people (instead of ten times too many).
spinchange 14y ago
I used to love digg in the early days. People point to the v4 revision as being the final nail, but they started wavering and losing the magic literal years before that. FWIW, Pligg (the digg clone CMS) looks like it's getting a twitter bootstrap upgrade. I've been wanting to roll my own "digg/reddit/HN" for ages. Maybe now's the time. http://www.pligg.com/demo/ http://www.pligg.com/demo/
- Osiris 14y ago
  I had a pligg site setup a while back for 'sci-fi' news. It was a fairly poorly implemented PHP application at the time and not nearly as clean and neat as Digg. However, that demo shows that they have been putting a lot of work into it since then.
- dreadsword 14y ago
  FYI: Reddit is open source. You don't have to roll your own, just go git it: https://github.com/reddit/ https://github.com/reddit/
  - Angostura 14y ago
    FWIW, I found Pligg a lot easier to configure and set up when I needed to create a quick intranet news portal last year.
    - dreadsword 14y ago
      Fair enough - I've played with Pligg too, and found it really easy. I've never tried to deploy reddit, though. I imagine it to be much more robust & therefore complicated...
- underdown 14y ago
  hey Chris - how ya been? for me the problem with digg started when they took down th leader board. It was what a few months later that "gamification" was the buzz word. Digg just effed that one up.
untog 14y ago
I don't doubt that something can be done with it, but I'm dubious of Digg as a brand these days. Similar to MySpace, it's lost all the credibility it once had.
cantbecool 14y ago
The first iteration of digg looks awfully like reddit. http://web.archive.org/web/20041230012732/http://digg.com/ http://web.archive.org/web/20041230012732/http://digg.com/
- stuartmemo 14y ago
  Those stories have more diggs on them than the front page of digg today.
- deleted 14y ago
  [deleted]
bitwize 14y ago
Why? Reddit is like Digg 2 now. Back in the day Digg was for dudebros who wanted to swap girls gone wild links while Reddit was the "isn't Haskell grand?" place. But since about 2008 or so when Reddit rubbed up against Digg and 4chan and a big chunk of their user base rubbed off and clung to it, Digg has been made wholly redundant.
chimi 14y ago
Sorry for my ignorance. I've been searching for exactly what went wrong with the Digg redesign, but I can't find anything that really spells it out. Something with side-by-side comparisons or a deeper analysis than "Users leave in drove after Digg redesign that alienates user base." How did it alienate those users? Of course I was aware that it happened, but because I wasn't part of the community, I never understood what it was, exactly. Also, is this an example that illustrates why craigslist refuses to redesign their site? A redesign really could spell the end of craiglist like digg.
- grassclip 14y ago
  http://en.wikipedia.org/wiki/Digg#Digg_v4 http://en.wikipedia.org/wiki/Digg#Digg_v4 I believe there were "sponsored" posts as well.
- Tobu 14y ago
  "redesign" here means something more radical. Sponsored stories from partnered news outlets got auto-pushed to the front page, hand-made tweaks to the secret-sauce algorithm were used to suppress a very noticeable user protest (links to outside discussion of the redesign, and a lot of links to reddit), which turned into a revolt. All comments were lost (a very small subset was restored from somewhere, but there was no proper backup discipline). A week or so after that, someone who visited the front page would only see posts with a few hundred upvotes, and sponsored posts. Digg was ailing before that (as I recall, the Digg Patriots and the clique dynamics were a factor), but traffic took an abrupt dive at that point. Artistic rendering of the debacle: https://secure.flickr.com/photos/25036088@N06/3424896427/sizes/o/in/set-72157615924666317/ https://secure.flickr.com/photos/25036088@N06/3424896427/siz... https://secure.flickr.com/photos/25036088@N06/4192738180/sizes/o/in/set-72157615924666317/ https://secure.flickr.com/photos/25036088@N06/4192738180/siz... https://secure.flickr.com/photos/25036088@N06/6642064613/sizes/o/in/set-72157615924666317/ https://secure.flickr.com/photos/25036088@N06/6642064613/siz...
- gamble 14y ago
  The Digg redesign had any number of problems, most of them inherent in any project to completely reimplement a complex piece of software that already has a large user base. Bugs, missing features, etc. IMO, the larger problem was one of philosophy. Was the site primarily designed for people generating the traffic or those receiving it? How do you deal with people gaming the system? Digg chose to side with the people gaming the system, presumably because it was a more obvious path to profitability. (Digg had a large staff and ridiculously high burn rate) Prior to the v4 redesign, however, there was at least the illusion that regular users' submissions and voting mattered. Digg v4 simply eliminated the roundabout of gaming the system by making votes almost irrelevant; publishers and marketeers could simply pipe all of their content directly to the top of the frontpage by gathering a sufficiently large number of followers. It made the site little more than a pseudo-RSS frontend for content farms. Reddit has been successful by fighting a vigorous, if behind-the-scenes, war against spamming and gaming. It may be regressing toward the mean, but at least it's a mean defined by the users rather than a spammer.
dreadsword 14y ago
$500k: hard to tell if they've over- or under- paid. What's the Digg Balance Sheet look like? How about the last year of cash flow statements? Without those, its impossible to evaluate the worthiness of the deal.
- brc 14y ago
  Note it's 'acquiring the assets' rather than 'acquiring the company'. In general this means the steaming wreck of a company will be left behind, asset stripped. In other words, if Digg owes you money, you're not going to be able to ask the new owners for it. It also means it's up to them which employees (if any) they take on. This is a sale of brand name, domain name, IP and probably very little else.
Tobu 14y ago
Digg is a shadow of an online community, but its fall gave us War, a three-part social media epic by ncomment: https://secure.flickr.com/photos/25036088@N06/3424896427/sizes/o/in/set-72157615924666317/ https://secure.flickr.com/photos/25036088@N06/3424896427/siz...
alaskamiller 14y ago
Reddit won the game, slow and steady. Reddit now literally powers the generation of news cycles across the blogerverse. BuzzFeed? HuffPo? Gawker? TheDaily? Reddit, yesterday. First thing first is rescue the culture. Digg engineering already fled, the peanut gallery in the valley keeps squawking with delight about your failure, and all you have left is some nicely designed pages showing double digit gains on stale links that's a shade away from being as if they were spun up by a Russian spam squad. Save yourself, redo the logo, redo the color scheme, don't let legacy drag you down. Second thing is do some soul searching, figuring out what layer Digg wants to play in. Links aggregation? Community building and content creation? Traffic? Attention? Engagement? That elusive ad sharing model for content creators? After that figure out for who. Reddit's core is dying, and eventually it'll be fully crowded out by the mainstreaming of rage comics, aww pics, and counter-Tumblr-pseudo-nerdy programming. Do you target those people, the walking wounded much like Slashdot? Or do you go after the youths, the ones addicted to Instagrams, 9gag, imgur, but bored of their Facebook feeds? Then play the waiting game. New is everything old, after all. The game's so different now from 2005. All the majors have feeds now. All the majors have figured out sharing, commenting, and extracting action on a story item. On top of that you're competing against mobile guys like Flipboard. This is one of those situations where execution is easier than creating an idea. What is Digg's $1MM idea? Good luck with that because Digg needs to be futuristic but also really lucky twice being at the right place, the right time, with the right idea. Once you're lucky, twice you're good, right? I bet this kind of flame out, this one thing keeps Mark Zuckerberg from sleeping.
- SquareWheel 14y ago
  Reddit now literally powers the generation of news cycles across the blogerverse. I didn't know Reddit had their own power plant.
  - lazugod 14y ago
    Is that a joke, or are you unfamiliar with the many definitions of power?
    - 14y ago
marknutter 14y ago
This is a case of a company having delusions of grandeur. Instead of humming along with 10 or so employees raking in cash hand-over fist, they tried to grow as fast and as large as possible to try to revolutionize news. Instead, Reddit did the former and is stable and profitable; it never pretends to be something it's not. Not all companies are going to change the world, nor should they. I see Facebook and Twitter making the same mistakes. Perhaps Facebook is a great place to keep in touch with friends but nothing more. Perhaps Twitter is simply a great replacement for blogging, nothing more. Instead of filling their niches and quietly making a small number of employees very wealthy, they try to become these massive institutions that are reliant on very fickle user bases. It's a house of cards.
- Tobu 14y ago
  It's the nature of venture capital: shower founders with money, now they're burning through it and they are in your debt. Either they find a way to make it big, or the startup is driven to the ground.
- codexon 14y ago
  As someone who used Digg and Reddit from their infancy I have been able to observe when and how Digg fell from #1. I don't think they failed because they were having delusions of grandeur. The 1st mistake that Digg made was the introduction of power users. As a power user your stories were artificially boosted to the front page. After this happened, I noticed a huge decline in quality where the front page became mostly populated by articles from cracked and huffingtonpost. This quote from another user summed up the situation. In version 3 around 100 diggers ran 80% of the front page – to get on the front page you had to cover Kevin getting a blow job from Stallman, or get a power user to submit your story. At that point Digg was not a democracy at all, but a curated list by paid Digg pros who shilled for hire. If you were a nice guy, or a tech publisher, you had power digger friends who would submit your stuff for you for free. Then there is the 2nd mistake that everyone knows about. Digg 4.0, the last mistake that finally made Reddit bigger than Digg. Large domains Engadget and Mashable flooded the front page with their auto-submitted stories. It was then that Kevin Rose betrayed the power users for large publishers, just as he had betrayed the regular users for power users many years ago. If Digg had not done any of this, there would have been a very good chance that they would still have been the largest aggregator today.
anewguy 14y ago
How much do you think it would cost to buy reddit?
- arn 14y ago
  Problem with buying Reddit is that you would still never really own reddit. If digg's fall has taught us anything, it's that heavily community-driven sites are owned by the community. Try to make any major/unpopular changes in direction or business, and the entire site may come crumbling down.
  - deleted 14y ago
    [deleted]
synack 14y ago
I imagine it'll end up costing them quite a bit more than $500k when the dust settles... Digg probably has quite a bit of debt racked up by now.
ruhsler 14y ago
news.me + digg could be good
saurik 14y ago
I wonder what they consider the "core assets" to be; some specific items I'm curious about: domain name, codebase, hosting contracts, Aeron chairs, employees.
- larrys 14y ago
  For example: http://www.domainnamenews.com/domain-sales/diggcom-acquires-wefollowcom-domain-side-story/6351 http://www.domainnamenews.com/domain-sales/diggcom-acquires-...
paulbjensen 14y ago
This should be a film, the story has everything: business press coverage, the BluRay code event, death threats to the founder, a near-deal with Google, the exit of the CEO, the 4.0 debacle, the company downsizes, the founder leaves, the company struggles, then the company sells it's shell. I hope BusinessWeek does a piece on this.
dr_ 14y ago
From techcrunch: "Betaworks, says Digg, will soon unveil a new “cloud-based version of Digg” that will complement News.me’s iPhone and iPad apps" Not sure what this means, Digg was never a desktop client. It's betaworks using lingo that will grab the attention of non tech readers to suggest something interesting is going on. But it isn't. Just like with a lot of their other stuff. Bitly is a simple concept which has been done many times. News.me is nothing interesting at all, just an attempt to rip off Flipboard. Chartbeat is just another way to visualize data that's available by so many other means. Nothing original with betaworks.

251 points by mikerice 14y ago

From WSJ: "The price was just $500,000, three people familiar with the matter said—a pittance for a company that raised $45 million from prominent investors including LinkedIn founder Reid Hoffman and Marc Andreessen." http://online.wsj.com/article/SB10001424052702304373804577523181002565776.html?mod=wsj_share_tweet http://online.wsj.com/article/SB1000142405270230437380457752...

samstave 14y ago
WOW That is nothing! I am installing cisco switch gear as we speak that s worth more than that!
- slig 14y ago
  For a 4-letter domain I say it's quite a bit.
  - majorlazer 14y ago
    Digg is ranked 192 on Alexa. Its Google Page Rank is 8. And the name is very popular and it used to have a huge following. Once the media get's a hold of this story (well it already has), tons of people will visit it just to see what they do with it. Plus, they still have a ton of traffic, of course not as much as they used to.
  - samstave 14y ago
    True, I hadn't thought of the domain acquisition, but thats because digg is effectively dead to me. I can't think of any service that could be built out that will benefit from that domain name though, s even for a four letter domain - I think they threw $500K down the tubes.
akanster 14y ago
That WSJ article attributes Digg's fall from grace to "rivals like Facebook Inc. and Twitter Inc." and makes no mention of the Digg v4 redesign disaster. That was what did them in more than anything. EDIT: The story has been updated with a new paragraph, "A series of redesigns..."
- speg 14y ago
  It was going downhill long before v4 IMO.
  - BiWinning 14y ago
    There was point, years before the v4 redesign, where 90% of the content hitting the front-page was supplied by 100 or so so-called "power users". Of that 90%, probably 40% was supplied by Mr. Baby Man himself. Hitting the frontpage was an impossibility unless you went around friending other users and building up your network. A worthwhile investment if you were doing social media professionally but for the average user they had no voice except in a comments section. After I realized this I moved onto reddit and never looked back. Of course reddit has suffered it's own unique set of consequences from becoming the kid on the block.
  - michaelhoffman 14y ago
    Agreed, but for many (including myself), the Digg v4 fiasco was the last straw, and there was an organized exodus of users at that point.
  - mcbutterbunz 14y ago
    Yes it was. Remember the digg bar? http://en.wikipedia.org/wiki/Digg#Digg_Bar http://en.wikipedia.org/wiki/Digg#Digg_Bar
- jshen 14y ago
  digg had reached a local maximum prior to v4 that wasn't sufficient for the amount of money they had raised.
lbarrow 14y ago
The WSJ's failure to mention reddit speaks to how little they know about the situation beyond the numbers.
- Stenerson 14y ago
  "Newer social news website such as Reddit Inc. also stole some of Digg's thunder. Last December, Reddit drew more visitors than Digg for the first time, according to comScore, and since then it has maintained that lead."
landonhowell 14y ago
$500K? I cant still remember the first time I saw this cover: http://workbench.cadenhead.org/media/businessweek-kevin-rose-digg-cover.png http://workbench.cadenhead.org/media/businessweek-kevin-rose...
blo 14y ago
$500K is a steal for a well-known brand, and 2M-4M monthly US visitors (funny how Compete reports higher traffic vs. Reddit while Quantcast reports 1/4x the traffic of Reddit)
runn1ng 14y ago
"None of Digg's remaining employees will join Betaworks as part of the acquisition." what did they acually buy? The know how? The technology? None of that is revolutionary today. And there is no community on digg right now whatsoever (unlike /. which still lives its own life). Maybe the name is worth something, but I don't really think that it matters that much.
- fasouto 14y ago
  Well, Digg still have a lot of visitors, is a well-known page with high PageRank (8). So for only 500.000, I consider it a good deal.
- ig1 14y ago
  7 million uniques a month disagree.
- unreal37 14y ago
  The domain name and brand recognition. For $500K, cheap.
  - vaksel 14y ago
    yeah, something shady must be going on. My guess is that you'll find similar people on Digg's and News.me boards. And this was just a way to a) write off Digg as a permanent loss off the books and b) transfer those assets cheaply to the other company, which might boost them from being a loser to being a winner Noone sells Digg for $500K...not unless they are millions and millions in debt
lifeisstillgood 14y ago
Just to clarify - they raised 45m So either they spent 45m in past 4 years, or they did not draw down all of it or someone paid 1/2m for 10m in the bank? Or am I fundamentally missing something obvious
- adventureful 14y ago
  I'd wager they spent it. Crunchbase reports they had 60 employees at some update in the past, so it was probably higher than that at the peak. 60 employees alone probably cost them $6 to $8 million per year depending on all the perks. You could easily vaporize $25 to $35 million over four years in San Francisco on 60 employees. But keep in mind that $45 million wasn't raised in the past four years. On 9/08 they raised $28.7 million, and then another $5 million on 7/11. So they've raised $33.7m over the last four years.
tptacek 14y ago
It "feels" like a reasonable shorthand for company outcomes is: an outcome is either (a) a categorical success for the investor, or (b) might as well be written off entirely. With that feeling in mind, the fact that the acquisition was for $500k and not $1MM or $10MM or $40MM is irrelevant: any number falling outside bucket (a) is a loss. And you don't get into venture capital without being able to metabolize a loss. The people that plowed money into Digg had a charter to put ~$45MM at risk. That was their job: find a place for $45MM to live and, probably, die. One major investment in 10 generates a win that pays for the other 9. So: fuck it, right?

fein 14y ago

I am incredibly skeptical about the plausibility of resurrecting Digg, but for 500k I sure hope they do. It was my first social media home and it would be nice to be able to go back to what it was; not a marketing front end for corporate prostitution. Fingers crossed, but betaworks seems to want to take Digg in the direction it should have gone during the v2->v3 upgrade.

samstave 14y ago
Not a hope. And the fact that they are going to fold it into news.me to send links of articles that others are reading sounds retarded.
- fein 14y ago
  Oh damn, if they integrate that into news.me, they've shot themselves with a $500,000 proverbial bullet in the proverbial foot. At this point Reddit can probably not be killed. The only hope that betaworks could have at success is a vanilla relaunch of Digg, minus the gaming problems and "advertising for hire" functionality. Remember Digg when Dragon Age: Origins came out?

CubicleNinjas 14y ago

How the mighty have fallen...

zinssmeister 14y ago

the german Digg clone Yigg.de also sold today. Funny how that timing works out. (http://yigg.de/nachrichten/2012/07/12/ekaabo-uebernimmt-yigg http://yigg.de/nachrichten/2012/07/12/ekaabo-uebernimmt-yigg)

PaulHoule 14y ago

the trouble is that fixing Digg means getting rid of the existing user base

SwellJoe 14y ago
What existing user base?
- PaulHoule 14y ago
  the people that vote up lots of awful content I can't stand looking at
  - SwellJoe 14y ago
    Spammers spamming spammers.
underdown 14y ago
Ya, Kevin & Jay tried that back in 2006 - worked out real well for them.
- PaulHoule 14y ago
  they gotta get them to sign a statement that they'll click on ads

jgroome 14y ago

> The News.me team will take Digg back to its essence: the best place to find, read and share the stories the internet is talking about. Right now. With my cynicism hat on nice and tight, it seems a bit late for that. Digg WAS, in its heyday, the best place to find and share online content. But as the management undertook on iffy decision after another, and as imitators sprung up left right and centre, it lost its place in the online world. Sad. We have plenty of content aggregators now. The kind of people Digg 5.0 (?!) will target are probably more than happy finding their entertainment through Twitter, Facebook, and dare I say it, Reddit. Having said that, I for one wish the new team all the luck in the world in trying to get the site back to its former glory, and I look forward to trying it out.

sharkweek 14y ago
I've got my reddit page nice and customized so I see exactly what I'm interested in appear on the front page every morning through specific subreddits I come to HN for a bit more focused conversation on industry related stuff I don't think Digg really has a place anywhere between those two
citricsquid 14y ago
There is always room for a better content aggregator, reddit etc. all have their own set of flaws and problems. If the Betaworks team have the ideas to make a great content aggregator then purchasing the Digg brand is absolutely brilliant. The hard part of launching a new site is traction, if they can launch with "the new Digg" (and the site is impressive) that $500k will be the best $500k they could possibly spend on marketing. Techcrunch, Mashable, Reddit... it would be the front page of everywhere, "Digg crashed and burned and after being bought for $500k it's back and it's amazing!", hell maybe even CNN and the BBC would cover it. Not only that they have the entire userbase of Digg to market their new site to. A social news site biggest problem is getting users; this solves that problem (and them some) If we assume that instead of the thought process being "We can have Digg for $500k... should we do it?" the thought process was actually: "We have this brilliant idea for content aggregation, how can we most effectively implement and market this?" then it sounds like a much safer and sensible thing to do.
hello_asdf 14y ago

adventureful 14y ago

The only reason it's $500k and not $0 is to save a small amount of face. Digg is losing money, and has never made money in its entire history, so it's going to cost Betaworks a lot more than $500k to take it over.

SwellJoe 14y ago
Digg bleeds money because they're overstaffed for what they do. Reddit ate their lunch with five paid people, while Digg was employing dozens. I think they had over 100 people on staff at their peak. Even now, when reddit has an order of magnitude more traffic than Digg ever had (1 billion+ pageviews a month), reddit runs with a staff of about 10 people. Digg probably still has a whole lot of dead weight, even at this point when the whole thing is only worth two and a half good developers salaries.
- adventureful 14y ago
  Absolutely agree. Digg should be run by 3 to 5 people tops at its current size. It'll still cost more than $500k to transition the service to whatever it is they have in mind. It'll probably cost more than $500k just to trim Digg down to size.
- earl 14y ago
  Yeah, but reddit appears to have been staffed with employees who worked all hours of the night and day for a salary; see blog posts from before reddit gold. That's not sustainable and unless you have a line on a set of really smart suckers who want to work way too much for the same money then can get elsewhere working half the hours or on call... you need more employees.
  - SwellJoe 14y ago
    Two points: 1. I don't think that people, working all hours, are actually significantly more productive than those working regular hours. In fact, in knowledge work, there's good evidence that you only get two or three hours of real productivity per day, no matter how long you keep banging your head on the keyboard. 2. Even if reddit developers and staff were twice as productive as Digg folks, that only indicates that Digg had five times too many people (instead of ten times too many).

spinchange 14y ago

I used to love digg in the early days. People point to the v4 revision as being the final nail, but they started wavering and losing the magic literal years before that. FWIW, Pligg (the digg clone CMS) looks like it's getting a twitter bootstrap upgrade. I've been wanting to roll my own "digg/reddit/HN" for ages. Maybe now's the time. http://www.pligg.com/demo/ http://www.pligg.com/demo/

Osiris 14y ago
I had a pligg site setup a while back for 'sci-fi' news. It was a fairly poorly implemented PHP application at the time and not nearly as clean and neat as Digg. However, that demo shows that they have been putting a lot of work into it since then.
dreadsword 14y ago
FYI: Reddit is open source. You don't have to roll your own, just go git it: https://github.com/reddit/ https://github.com/reddit/
- Angostura 14y ago
  FWIW, I found Pligg a lot easier to configure and set up when I needed to create a quick intranet news portal last year.
  - dreadsword 14y ago
    Fair enough - I've played with Pligg too, and found it really easy. I've never tried to deploy reddit, though. I imagine it to be much more robust & therefore complicated...
underdown 14y ago
hey Chris - how ya been? for me the problem with digg started when they took down th leader board. It was what a few months later that "gamification" was the buzz word. Digg just effed that one up.

untog 14y ago

I don't doubt that something can be done with it, but I'm dubious of Digg as a brand these days. Similar to MySpace, it's lost all the credibility it once had.

cantbecool 14y ago

The first iteration of digg looks awfully like reddit. http://web.archive.org/web/20041230012732/http://digg.com/ http://web.archive.org/web/20041230012732/http://digg.com/

stuartmemo 14y ago
Those stories have more diggs on them than the front page of digg today.
deleted 14y ago
[deleted]

bitwize 14y ago

Why? Reddit is like Digg 2 now. Back in the day Digg was for dudebros who wanted to swap girls gone wild links while Reddit was the "isn't Haskell grand?" place. But since about 2008 or so when Reddit rubbed up against Digg and 4chan and a big chunk of their user base rubbed off and clung to it, Digg has been made wholly redundant.

chimi 14y ago

Sorry for my ignorance. I've been searching for exactly what went wrong with the Digg redesign, but I can't find anything that really spells it out. Something with side-by-side comparisons or a deeper analysis than "Users leave in drove after Digg redesign that alienates user base." How did it alienate those users? Of course I was aware that it happened, but because I wasn't part of the community, I never understood what it was, exactly. Also, is this an example that illustrates why craigslist refuses to redesign their site? A redesign really could spell the end of craiglist like digg.

grassclip 14y ago
http://en.wikipedia.org/wiki/Digg#Digg_v4 http://en.wikipedia.org/wiki/Digg#Digg_v4 I believe there were "sponsored" posts as well.
Tobu 14y ago
"redesign" here means something more radical. Sponsored stories from partnered news outlets got auto-pushed to the front page, hand-made tweaks to the secret-sauce algorithm were used to suppress a very noticeable user protest (links to outside discussion of the redesign, and a lot of links to reddit), which turned into a revolt. All comments were lost (a very small subset was restored from somewhere, but there was no proper backup discipline). A week or so after that, someone who visited the front page would only see posts with a few hundred upvotes, and sponsored posts. Digg was ailing before that (as I recall, the Digg Patriots and the clique dynamics were a factor), but traffic took an abrupt dive at that point. Artistic rendering of the debacle: https://secure.flickr.com/photos/25036088@N06/3424896427/sizes/o/in/set-72157615924666317/ https://secure.flickr.com/photos/25036088@N06/3424896427/siz... https://secure.flickr.com/photos/25036088@N06/4192738180/sizes/o/in/set-72157615924666317/ https://secure.flickr.com/photos/25036088@N06/4192738180/siz... https://secure.flickr.com/photos/25036088@N06/6642064613/sizes/o/in/set-72157615924666317/ https://secure.flickr.com/photos/25036088@N06/6642064613/siz...
gamble 14y ago
The Digg redesign had any number of problems, most of them inherent in any project to completely reimplement a complex piece of software that already has a large user base. Bugs, missing features, etc. IMO, the larger problem was one of philosophy. Was the site primarily designed for people generating the traffic or those receiving it? How do you deal with people gaming the system? Digg chose to side with the people gaming the system, presumably because it was a more obvious path to profitability. (Digg had a large staff and ridiculously high burn rate) Prior to the v4 redesign, however, there was at least the illusion that regular users' submissions and voting mattered. Digg v4 simply eliminated the roundabout of gaming the system by making votes almost irrelevant; publishers and marketeers could simply pipe all of their content directly to the top of the frontpage by gathering a sufficiently large number of followers. It made the site little more than a pseudo-RSS frontend for content farms. Reddit has been successful by fighting a vigorous, if behind-the-scenes, war against spamming and gaming. It may be regressing toward the mean, but at least it's a mean defined by the users rather than a spammer.

dreadsword 14y ago

$500k: hard to tell if they've over- or under- paid. What's the Digg Balance Sheet look like? How about the last year of cash flow statements? Without those, its impossible to evaluate the worthiness of the deal.

brc 14y ago
Note it's 'acquiring the assets' rather than 'acquiring the company'. In general this means the steaming wreck of a company will be left behind, asset stripped. In other words, if Digg owes you money, you're not going to be able to ask the new owners for it. It also means it's up to them which employees (if any) they take on. This is a sale of brand name, domain name, IP and probably very little else.

Tobu 14y ago

Digg is a shadow of an online community, but its fall gave us War, a three-part social media epic by ncomment: https://secure.flickr.com/photos/25036088@N06/3424896427/sizes/o/in/set-72157615924666317/ https://secure.flickr.com/photos/25036088@N06/3424896427/siz...

alaskamiller 14y ago

Reddit won the game, slow and steady. Reddit now literally powers the generation of news cycles across the blogerverse. BuzzFeed? HuffPo? Gawker? TheDaily? Reddit, yesterday. First thing first is rescue the culture. Digg engineering already fled, the peanut gallery in the valley keeps squawking with delight about your failure, and all you have left is some nicely designed pages showing double digit gains on stale links that's a shade away from being as if they were spun up by a Russian spam squad. Save yourself, redo the logo, redo the color scheme, don't let legacy drag you down. Second thing is do some soul searching, figuring out what layer Digg wants to play in. Links aggregation? Community building and content creation? Traffic? Attention? Engagement? That elusive ad sharing model for content creators? After that figure out for who. Reddit's core is dying, and eventually it'll be fully crowded out by the mainstreaming of rage comics, aww pics, and counter-Tumblr-pseudo-nerdy programming. Do you target those people, the walking wounded much like Slashdot? Or do you go after the youths, the ones addicted to Instagrams, 9gag, imgur, but bored of their Facebook feeds? Then play the waiting game. New is everything old, after all. The game's so different now from 2005. All the majors have feeds now. All the majors have figured out sharing, commenting, and extracting action on a story item. On top of that you're competing against mobile guys like Flipboard. This is one of those situations where execution is easier than creating an idea. What is Digg's $1MM idea? Good luck with that because Digg needs to be futuristic but also really lucky twice being at the right place, the right time, with the right idea. Once you're lucky, twice you're good, right? I bet this kind of flame out, this one thing keeps Mark Zuckerberg from sleeping.

SquareWheel 14y ago
Reddit now literally powers the generation of news cycles across the blogerverse. I didn't know Reddit had their own power plant.
- lazugod 14y ago
  Is that a joke, or are you unfamiliar with the many definitions of power?
  - 14y ago

marknutter 14y ago

This is a case of a company having delusions of grandeur. Instead of humming along with 10 or so employees raking in cash hand-over fist, they tried to grow as fast and as large as possible to try to revolutionize news. Instead, Reddit did the former and is stable and profitable; it never pretends to be something it's not. Not all companies are going to change the world, nor should they. I see Facebook and Twitter making the same mistakes. Perhaps Facebook is a great place to keep in touch with friends but nothing more. Perhaps Twitter is simply a great replacement for blogging, nothing more. Instead of filling their niches and quietly making a small number of employees very wealthy, they try to become these massive institutions that are reliant on very fickle user bases. It's a house of cards.

Tobu 14y ago
It's the nature of venture capital: shower founders with money, now they're burning through it and they are in your debt. Either they find a way to make it big, or the startup is driven to the ground.
codexon 14y ago
As someone who used Digg and Reddit from their infancy I have been able to observe when and how Digg fell from #1. I don't think they failed because they were having delusions of grandeur. The 1st mistake that Digg made was the introduction of power users. As a power user your stories were artificially boosted to the front page. After this happened, I noticed a huge decline in quality where the front page became mostly populated by articles from cracked and huffingtonpost. This quote from another user summed up the situation. In version 3 around 100 diggers ran 80% of the front page – to get on the front page you had to cover Kevin getting a blow job from Stallman, or get a power user to submit your story. At that point Digg was not a democracy at all, but a curated list by paid Digg pros who shilled for hire. If you were a nice guy, or a tech publisher, you had power digger friends who would submit your stuff for you for free. Then there is the 2nd mistake that everyone knows about. Digg 4.0, the last mistake that finally made Reddit bigger than Digg. Large domains Engadget and Mashable flooded the front page with their auto-submitted stories. It was then that Kevin Rose betrayed the power users for large publishers, just as he had betrayed the regular users for power users many years ago. If Digg had not done any of this, there would have been a very good chance that they would still have been the largest aggregator today.

anewguy 14y ago

How much do you think it would cost to buy reddit?

arn 14y ago
Problem with buying Reddit is that you would still never really own reddit. If digg's fall has taught us anything, it's that heavily community-driven sites are owned by the community. Try to make any major/unpopular changes in direction or business, and the entire site may come crumbling down.
- deleted 14y ago
  [deleted]

synack 14y ago

I imagine it'll end up costing them quite a bit more than $500k when the dust settles... Digg probably has quite a bit of debt racked up by now.

ruhsler 14y ago

news.me + digg could be good

saurik 14y ago

I wonder what they consider the "core assets" to be; some specific items I'm curious about: domain name, codebase, hosting contracts, Aeron chairs, employees.

larrys 14y ago
For example: http://www.domainnamenews.com/domain-sales/diggcom-acquires-wefollowcom-domain-side-story/6351 http://www.domainnamenews.com/domain-sales/diggcom-acquires-...

paulbjensen 14y ago

This should be a film, the story has everything: business press coverage, the BluRay code event, death threats to the founder, a near-deal with Google, the exit of the CEO, the 4.0 debacle, the company downsizes, the founder leaves, the company struggles, then the company sells it's shell. I hope BusinessWeek does a piece on this.

dr_ 14y ago

From techcrunch: "Betaworks, says Digg, will soon unveil a new “cloud-based version of Digg” that will complement News.me’s iPhone and iPad apps" Not sure what this means, Digg was never a desktop client. It's betaworks using lingo that will grab the attention of non tech readers to suggest something interesting is going on. But it isn't. Just like with a lot of their other stuff. Bitly is a simple concept which has been done many times. News.me is nothing interesting at all, just an attempt to rip off Flipboard. Chartbeat is just another way to visualize data that's available by so many other means. Nothing original with betaworks.