Re: Building Financial Plans

From: Carmen Paulino <>
Date: Fri 7 Apr 2000 09:23:28 -0700

> I am creating a very large content web site that will
> serve as a portal to a targeted population. This web
> site's revenue comes strictly from advertising.

> A warning from an ad-skeptic: I have worked with
> multiple investors on up-and-coming sites this year,
> and I can tell you that investors get mighty
> uncomfortable when you base 100% of your revenue on
> banner ads. They just do. The ad market has gone down
> and competition gets fierce - the more targeting &
> reporting you offer, the more everyone else does. And
> the number of sites with ads continues to increase
> faster than the number of paying advertisers. In a
> highly unpredictable market like the web, investors are
> reassured by revenue backup plans, like having banner
> ads, email ads, commerce, licensing & partnerships,
> etc.

Kim Brooks - you rock! But I've known that for a while
having read your very authoritative ClickZ article on
viral marketing, <Pitfall or Windfall> when it was
first published. Regarding your mention of InfoSpace's
revenue model -

> they are quite profitable and have been from the
> start - because they are flexible, with eggs in lots of
> baskets.

We look at this same idea from a slightly different
position, but it boils down to the same thing, I
believe. The way we put it is that during strategic
planning, envision yourself as a commodities or
securities broker. Each gets his/her share from both
the buyer and the seller - an enviable position. On the
Web, we can add the vendor, the consumer/viewer, and
all of the other stakeholders. Think about how each can
help you to subsidize your costs and to improve your
bottom line in return for first-rate service, products,
and information. It's ying-yang, debit-credit dynamics
at work.

Carmen Paulino
Interactive Advertising

Received on Fri Apr 07 2000 - 11:23:28 CDT


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