I’m in a very cynical and nasty mood today – perhaps related to the DDOS attack that’s happening against one of my websites right now. I think I’ve got it handled though (if you target me at the domain level, i’m just going to re-route all that traffic back to you :))
anyway… I’ve been looking at the TechCruch50 and it seems that most of the companies fail from the same thing most startups fail from: they don’t solve a problem and they have no path to revenue.
let’s take a few examples:
blah girls sounds like nothing more than a comic or a cartoon. How is this new? This is nothing special.
Tweegee is aimed at “tweens” which tells me 2 things: actual tweens will want nothing to do with it, and they won’t get more than $0.25 CPM for any ads on it. Tweens don’t have money, and as MySpace has proven, they don’t click ads or buy stuff from them. They also don’t want to be tweens, they want to do what the older kids are doing. All this will do is drive more people toward MySpace and Facebook.
Banking for kids? You’re kidding me right? Kids don’t have jobs or money. My middle school tried this once, and it failed miserably – despite them even giving us $5 and a free pencil for opening an account.
hangout should go hang out with Tweegee (and maybe even Shyrk too) so they can all fail miserably together. Of course I haven’t seen it yet, but it looks like a SecondLife ripoff. They’re claiming without privacy fears and what not, but come on can you really tie into social sites and eliminate privacy concerns? That’s a bigger oxymoron than “Microsoft Works” or “Airline Food.”
I’m not really sure what LiveHit does, but they use cool words like “velocity-based tracking and dynamic-predictive modeling.” It’d be nice if they told us what they actually do, but I know how some VCs have a tendency to favor fancy words and powerpoint presentations over actual business models – so hey, take your money now while you can.
Quant the News is another one of those companies that “was formed to develop and deploy advanced textual sentiment analysis applications that leverage its unique, AI-based natural language processing and data mining technology.” Again, some great fancy words that don’t tell me a damn thing about what you do.
Seriously, every time Techcrunch50 and Demo roll around I feel like starting a bunch of companies based around a nonsensical domain name and a few social APIs and seeing how much money I can get. Somebody else’s API + Adsense is NOT a business model. When are we going to see something that actually does something useful.
Here’s the questions I’d like to see them all answer:
1.) What unique unsolved problem are you solving?
2.) What’s your path to revenue (and you can’t say adsense.)
If you’re thinking of investing in some of these companies I have a better offer for you. Give me the money, and in 12 months I’ll give you back 1/2 of what you gave me. I guarantee you’ll get more ROI with my plan.