While the 53,651 debate was raging and Mathew Ingram was putting geeks on a pedestal, I was meeting with a company called Picaboo. Like Josh Kopelman of First Round Capital, I don’t spend time in “the valley” and had the good fortune of getting a referral to look at Picaboo.
In meeting with the founders, there were two important things every start up person should think about as well as Mathew Ingram.
First, the notion of a “concept round” of funding. In short, the two founders took capital of their own, got some friends and family money for the express purpose of seeing if the idea had any legs. They really didn’t know and really had only a vague idea so prior to spending ‘seed’ or start up capital, they spent their own money trying to nail a plan. Straight up, no marketing spin, they called it straight. It was a great part of the Picaboo story.
Second, paying customers. Paying customer rule, Mathew, not geeks and the Picaboo guys started from day one with a single focus: Can we get customers to buy photo books? Can we get a predictable amount of revenue per customer? No eyeball nonsense; the target was revenue.
I’m not suggesting you ignore anybody who drops by your service or offering. What I am suggesting is to focus on who the customer is going to be and measure your results against that crowd. 53,651 ‘geeks’ who love free, don’t click on the ads, and generally expect more for less, may not be your target crowd.
This issue (who do you target/who do you design for) came up today at BarCamp Toronto. Albert Lai of Bubbleshare talked about his questioned long-view strategy of designing for his ultimate customer, Moms, and not for the early adopter geeks. This decision drove their development priorities, so, for example, they completed their audio captioning before tagging. Something geeks criticised them for, but, something their more mainstream target preferred.
Cheers .. Kate
Posted by: Kate | May 13, 2006 at 19:55
Hey I used to work with Josh Koppelman at Infonautics. I'm sure he had no idea who I was but he was the 2nd youngest employee there I think. I was the youngest at 16.
Anyway I'm glad to see that in this repeat of 1998 there are still some people that realize you need revenue to survive.
Posted by: Josh Einstein | May 13, 2006 at 21:55
rick,
so, did you invest? what's picaboo's competitive edge given the idea of photo books is not new? see you tuesday!
mark
Posted by: mark evans | May 14, 2006 at 08:07
See you Tuesday Mark. To answer your other questions, they have paying customers, growth, and I'm very impressed with being able to make money in a "not new" space. We've just started talking but the larger issue is not Picaboo rather the original starting point about what is important, or who is important.
>R<
Posted by: Rick Segal | May 14, 2006 at 10:08
I totally agree, Rick, particularly about the paying customers part -- which is why I mentioned Flickr (which Dare Obasanjo challenges me on in the comments). The title of the post was actually meant to be ironic, or sarcastic, or maybe both :-) See you at mesh.
Mathew
Posted by: Mathew Ingram | May 14, 2006 at 16:03
this is a great reality check for many of the startups i work with. The old we've got lots of interest -- read -- what kind of people -- my post last week about "will people pay for this" is where the rubber hits the road. I love the description of eyeballs vs. customers -- a good reminder to passionate inventors that someone may find what you're doing "interesting" -- but that's not them parting with their money -- that's a whole other level of interest.
Wendy
Posted by: Wendy Kennedy | May 15, 2006 at 05:10
"customer is going to be and measure your results against that crowd."
It looks like you forget Microsoft is showing the wrong signal by giving a lot of their software for free. Seeding, killing competitions, first piece of cockaine is free, you name it. How good is it for ISVs or Web 2.0 companies waiting customers to pay for products?
Posted by: Mike | May 15, 2006 at 05:11
The more eyeballs you get coming to your website, the higher you can charge for advertising dollars. I mean look at the sites such as MySpace, FaceBook... There rather trivial technologies but it's the eyeball count that has the valuations so high.
As in TV, the more eyeballs you have, the higher you can charge for ad sports.
But it also depends what kind of company you want to build and where you want your revenue streams to be generated from.
Posted by: JJ | May 17, 2006 at 23:39