Why is #moonfruit trending on Twitter? It's the rebirth of a startup

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It’s not often that Internet companies last 10 years, but Moonfruit in the UK has proved pretty resilient. It survived the dotcom boom the first time round, launching with VC-backing, growing to 65 staff and cutting back to two staff in the space of a couple of years. It’s a wonder why they didn’t exit in the most recent boom, but here they are still, plugging away. And their resilience is proving to be an asset as their 10-years old web site building business comes back into fashion, even as more recent competitors like Weebly, Yola, MyDragnDrop and Webnode, and many others, try to capture the market for people who want to build simple web sites.

So what’s the best way to re-invigorate an internet brand after 10 long years? Get trending on Twitter, that’s how. So Moonfruit has been giving away 10 Macbooks for every year of their operation, beginning this week. The result is that it has become the top trending term on Twitter three days in a row, as all people need to do is add the hashtag #moonfruit to their tweet. An algorithm is randomly choosing a winner. There are five days left. By the second day this week it had reached 2.5% of all twitter traffic. But could the stunt backfire as fast as it worked?

Using hashtags in this way can also be a double edged sword. Plenty of people are wondering about the bizarre #moonfruit phrase and searching on the term. Plenty of others might well be annoyed by the hastag suddenly filling their stream as their friends rush to try and win a free Macbook. So the campaign could end up having diminishing returns.

A similar tactic was used by Lenovo to run a discount promotion offering a big discount off a new laptop. But these tactics raise the issue of hashtag spam – something Twitter is probably going to have to address soon with some kind of feature for people to vote something as hashtag spam.

However, the Moonfruit promo not putting everyone off. London-based twitterer @gecko84 won the first Macbook and the Moonfruit hashtag doesn’t look like going away.

That’s one way to breath new life into a web site concept – easy to build web pages a Flash interface – which has come back into fashion recently.

Webnode and Jimdo are more recent startup entrants, but they use an Ajax interface for users to build sites. Indeed, I recall writing a piece trashing Moonfruit 10 years ago for it’s – at the time – heavy-weight download interface for web site building. Flash was used to make their websites more design focused but it wasn’t ubiquitous in those days and not enough people had broadband. However it has proved to be a USP today, as the site has a drag and drop interface because of Flash and Flex. Moonfruit users tend to be ‘design aspirers’ and want to customise their own site styles. Clearly they were 10 years ahead of their time – again, another double edged sword.

Moonfruit also had some pretty damn patient investors. At its height the now defunct Europ@web, part of LVMH, had a portfolio of 52 startups during the dotcom boom. With a couple of decent exits, and the rest closed, they continued to back Moonfruit and then gave the founders the choice of buying the site back and managing ongoing customer liabilities. Other investors Macromedia and Bainlab supported this move too.

Moonfruit’s Weny Tan White and co-founder/CTO Eirik Pettersen were tenacious entrepreneurs. They cut the staff from 65 to just them, ran the site from a garret in Soho and hired freelancers.

In the early days of Moonfruit it was ad-supported but with the dotcom crash they had to be open with customers and ask them to pay. A loyal base said yes – and that’s pretty much kept them going since. Moonfruit also has a sister company, domain registrar Gandi.net, run by Stephan Ramoin (CEO), Joe White (Tan’s husband) and lead designer Kevin Foster.

What of the competition? Weebly and Yola (recently rebranded from Synthasite) are their main US competitors. While Moonfruit has been profitable for 6 years on a subscription model, these competitors have entered the market more recently and focused on a free, no ads model. Sound familiar?

But with the latest downturn they’ve tried to monetise with premium features, even as Moonfruit is moving in the opposite direction towards a freemium model of its own, with a premium upgrade path for users. For instance Weebly recently added storefronts – something Moonfruit has had for some time.

So where now from here? Tan says Moonfruit has grown 70% since last year and the build rate has increased by 40% since a new software release recently. That Twitter promotion should help.

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