Famous angel investor Ron Conway’s investment focus on real time startups earned him the moniker “Real Time Ron” by his close friends. But he’s certainly not the only venture capitalist out there focusing on this space.
New York based betaworks, an incubator/VC, is also right in the thick of things. They invested early in Summize and gained a sizable chunk of Twitter stock when that company was acquired in 2008 to become Twitter Search.
betaworks’ list of investments is a who’s who of the real time world. Twitter, StockTwits, TweetDeck, Twitterfeed, Tumblr and bit.ly are examples. And they also own a piece of what may be my favorite content site on the Internet – someecards.
Anyway, things seem to be rocking at betaworks based on the email to investors from CEO John Borthwick and COO Andrew Weissmanthat was sent out a couple of weeks ago and forwarded to us. bit.ly, for example, now has a 50% share of the URL shortener market and 130 million weekly clicks on links.
The full email is below.
From: Borthwick John
Sent: Sunday, May 31, 2009 11:23 AM
To: Schilling Mathias; Thomas Blondet; Smith Richard; Jean-Charles Charki; Herbert Allen III; Vigil Hank; Tarek Abdel-Meguid (Terry) Meguid; Ellman Stuart; Jaffe Bruce; Lisa Belzberg; Gillian Munson; Pittman Bob; Dominic Becotte; Joshua Stylman; Peter Hershberg; Stan Pantowich; Ron Conway; David Singer; Cappuccio Paul; Jean Marie Messier; Heiferman Scott; Howard Lindzon; Peretsman Nancy; Brad Reifler; Peter Borish; Brian Gottlieb; Strauss Zelnick; Taavet Hinrikus; Eric Martineau-Fortin; Ted Barnett; Robin Transport; Jon Brod; Russell Andrew; Ken Lerer; Gordon Crovitz; Goldstein Seth; Hilary Bergman; Shen David; Armstrong Tim
Cc: Andrew Weissman
Subject: betaworks / quarterly investor update / June
Once again a busy quarter at betaworks — and a good one to boot. We now have 22 companies in the network. They are listed here http://bit.ly/beta-network. We are still in the early days of building betaworks into a new type of media company – one characterized by a loosely coupled network of companies. A network that is connected by shared data services matched with a bottoms up structure. Chris Anderson wrote last week that “the .. new economy, the one rising from the ashes of this latest meltdown, will favor the small … distributed-information networks would do the same outside the walls of a single company. The Web would be globalization taken to the extreme. Projects would be open to the best of breed anywhere, creating virtual flash firms of suppliers and workers that would come together for one product and then re-form for another. “Small pieces, loosely joined” was the mantra.” Its only eighteen months but this is betaworks. We did a revision to our web site and included a interactive presentation on what is betaworks and how we believe what we are building is in essence a new kind of media company. You can find it at http://betaworks.com On to the update. Over the past quarter we spun out our first project, took a majority stake in one company, made two new investments and made solid progress on our other internal product.
Eight weeks ago we spun bit.ly out of betaworks into bit.ly Inc, and raised a seed investment round led by OATV (O’Reilly Alpha Tech Ventures), Social Leverage, Ron Conway, TAG, Chris Sacca, Mitch Kapor and the Founders Fund.
bit.ly has been on a tear since we launched it last summer — let me sketch out what it is, why its useful and offer some data points on progress. bit.ly is on its surface a link or URL shortener, helping people take long and unwieldy links and make them short and easy to share via email, Twitter, Facebook etc. But once you shorten a link with bit.ly the fun begins. You can put a simple “+” on the end of any bit.ly link and see, real time, the pace at which that link is getting shared and clicked on as it moves around these social distribution networks. The pace of growth at bit.ly has been astounding to say the least. Its been a real lesson to us here at betaworks — when you hit a vein things can grow extremely fast. I have had the fortune to work with fast growth products before, bit.ly growth has been like walking up a wall. Some data points. We launched bit.ly late last summer. The growth curve below illustrates the trend. Nine weeks ago when we closed the funding of bit.ly approx. 18m bit.ly links we getting clicked on every week, about 3-4 m per week day (the chart below shows daily clicks through the first week of April). In a little over 6 months we managed to earn a 30% share in the URL shortening market via organic, viral growth.
By the first of May we were doing approx. 50m decodes a week. Last week 130m bit.ly links were clicked on. Three weeks ago we rolled out bit.ly as default within Twitter. Twitter has added 20-30% on top of the viral growth – a great partnership that holds a ton of potential. Closing in upon bit.ly’s nine month anniversary it has over 50% market share. The betaworks / bit.ly team has done a phenomenal job scaling the systems and making sure that not once has a bit.ly link been unavailable. And the real time metrics distinguishes bit.ly from all of its competition. Scaling real time metrics is a huge challenge — one of those things that you only hear about when you slip up. Please if you come by the office mention this to the team of ex AOL engineers who run bit.ly — they are doing a great job. Business model wise we are starting to figure out where the money is. My sense is that there should be some very interesting monetization opportunities we can un-pack.
Three new things …
Partnered with TAG, betaworks took a majority stake in Twitterfeed a content router for publishers to Twitter. Twitterfeed has 150k publishers pushing out a quarter of a million updates daily. It’s a very interesting business — for some background see http://bit.ly/U2QM3. And we did seed investments in two new companies — Uservoice and GDGT — two wonderful companies, both of whom fit right into the betaworks thesis.
Other updates …
- Tweetdeck is doing very very well. The most recent version, out for less than a month, has received approx. a million downloads. Over the past quarter Tweetdeck has continued to pull ahead of its competition. Tweetdeck is the preferred way to access the Twitter stream for over 14% of all users and they send more messages from Tweetdeck than from Twitter.com or any other service.
- Tipjoy opened up an API to power payments for social applications. User and payment growth have both been strong. This is the first social payments API we’ve seen, excited to see how it grows. Stocktwits is doing very well — premium (paid version) is getting rolled out and they closed a series A in the past quarter.
- IILWY — who we told you last time had hired a CEO — rebranded itself to OMG POP. The service is doing great, they closed its B round led by Bessemer.
- Some e Cards is rocking. Last October (@betaday) the announced break-even– they have been cash flow positive ever since then, sold out till the fall. They have approx. 600k followers on Twitter and as I outlined in an essay I wrote 2 weeks ago they, and other betaworks, are leading a transformation in distribution (see: http://bit.ly/UWNtS).
- Lastly, we launched Chartbeat in the spring — we now have 500 paying customers, modest but solid start. Phew — I said it was a busy quarter.
Business Week included in its round up of the Twitter ecosystem five betaworks companies:
GigaOm mused about how we could “upstage Digg” at http://bit.ly/3IfpUO (laying out an interesting roadmap for bitlynow). Jenna Wortham from the New York Times http://bit.ly/4fol1L, Chartbeat press: Better Homes ‘n Garden! http://bit.ly/11YCEz “chartbeat is metrics porn” http://bit.ly/f48j5 “I recently stumbled upon Chartbeat and I’m already addicted.” http://bit.ly/6empP
And someone @ the LA Times is loving our work product!
Thats it for the quarter, onward and best regards to you all
JB, AW and our small crew