Maybe even dating sites deserve to find a special someone at one point in their lives… it looks like Badoo, the UK-based dating site, has joined forces with rival Hot or Not.
The two have yet to issue a formal release of any kind, but Hotornot now boasts the same amount of registered users as Badoo (146 million+), and Hotornot now directly refers users to Badoo’s terms and conditions (pictured below). There have been a few observed signs from users, too… → Read More
Feedback is rolling in on our Scamville post last night. Even more people are coming forward to talk about their experiences getting ripped off by Offerpal and SuperRewards, or how they were pitched by these companies to add offers to their apps.
We’ve got a lot more to say about this before we’re done. And we’re hoping that Facebook and MySpace make the right decisions for users and begin to enforce their own rules on subscription and other scams. Even if it means a huge drop in advertising revenue from the apps that rely on scams to make money.
But in this post we’re going to let two other people make their points. In a comment to the post yesterday HotOrNot founder James Hong talks about how his company tried, and quickly removed, scammy offers from their site. He says “In a nutshell, the offers that monetize the best are the ones that scam/trick users.”
And PlentyOfFish founder Markus Frind talks about being pitched by companies like Offerpal and SuperRewards. He also follows up with a post on his own blog.
James Hong: → Read More
San Francisco based HotOrNot, founded by James Hong and Jim Young in October 2000, has been acquired, we’ve heard from multiple sources. The buyers are investors connected with Avid Life Media, and paid somewhere around $20 million for the site. Hong and and Young have been taking money out of the very profitable business all along the way – which we reported was another $20 million or in May 2007. HotOrNot never raised outside funding. The investors are creating a new company, called HotOrNot Media (new site coming soon), and they may be acquiring more properties as well. I spoke with Hong a few moments ago, who confirmed the acquisition, which closed on Friday, but not the price. He says he and Jim will not be affiliated with the business on a day to day basis going forward. “We’ve been working on HotOrNot for seven years now,” said Hong, adding “It’s time to break up with this girlfriend.” HotOrNot makes money from advertising, virtual flowers and a premium fee when users want to connect. They experimented briefly with a free model, but abandoned it last September in the face of overwhelming spam. Their annual revenue is estimated to be around $5 million, with $2 million in profit. According to Comscore, the site has around 5 million monthly unique visitors and 200 million page views. CrunchBase Information HOT or NOT Avid Life Media Information provided by CrunchBase → Read More
Social network Piczo has released a new feature into private beta: Piczo Zone. It’s being tested by a small group of users now and will be released generally in a few weeks. What is it? Product Evangelist Keith Crowell says its a way for users to decorate their profile pages in much the same way as teenagers decorate their rooms – with posters, music, etc. Users take (or create) images, videos, style sheets or just about anything else and then add it to their profile. Each content item also includes descriptive data and tags. When someone creates something (say an image showing a band or artist name), any other user can add it to their profile as well. All of the “stuff” created in the Piczo Zone will then spread virally as the more popular items gets added by more and more users. Users like this stuff – they can see what the popular kids (however defined) put on their profiles and then add the same things to their own. For now users can’t add stuff that they see directly from their friends’ profiles, but software engineer Devon Boyle says they’ll add that functionality shortly. Users Love This Stuff. But So Do Advertisers But there’s another reason this is important: user profiling for advertising. As users add artists/bands, popular movies and well known brands (nike, whatever) to their profiles they build an extremely detailed demographic and psychographic profile of themselves that can be used for far more targeted advertising. As an example, a music label could focus advertising around a new album release to users who’s added certain similar bands and artists to their profile. It’s highly likely that the advertising will be aimed at people who are likely to buy, and ad rates increase dramatically. The content can also be used to predict new trends far before traditional methods. Users will create their own images for a popular local indie band, for example. As more and more users add the image, someone with access to aggregate data will be able to see what’s going to become mainstream well before it actually does. Since Piczo’s users, mostly teenagers, are the trendsetters, it’s a particularly powerful tool. Piczo isn’t the first social network to experiment with something like this. In July we wrote about a similar product called HotLists released by HotOrNot. HotLists are made up only of images, but like → Read More
Hot or Not have abandoned their much publicized move to a free model. According to an email from Hot or Not’s founders, since moving to a free model the site had become inundated by spam: You also warned us that this would probably lead to more spammers and fake profiles. You were right, this is exactly what happened. The spammers got aggressive to the point where they were screwing up the system, even causing the “someone wants to meet you” emails to not be sent for periods as long as 5 days.” As before, Hot or Not will now have a free level of membership then a paid tier for sending messages to profiles. → Read More
Crunchyroll is a San Francisco based startup that is a sort of YouTube for anime and other mostly Asian video content. The three founders, who asked to remain anonymous, are all employees of HotOrNot and the company operates out of HotOrNot’s San Francisco offices (although HotOrNot has no financial interest in the company, according to the founders). The site launched in the summer of 2006 and has grown rapidly, particularly since March 2007. Worldwide comscore stats show 1.3 million unique visitors in July, up from 480,000 in March. The company also had nearly 100 million page views in July and is seeing 20% monthly page view growth. That growth was apparently enough to get the attention of at least one possible suitor, Viacom. A source tells us that the company was very close to selling to Viacom for $10 million earlier this year, but the deal fell through when Viacom realized that owning the site, which contains a lot of copyright infringing content, may have hurt their positioning in the billion dollar ongoing litigation with Google. Crunchyroll refused to comment on the deal. All video is uploaded by users and has advertising around it. Premium users who “donate” $6 per month to the site get an ad free version and higher quality video. Rumor has it the company is making $75k/month or so in revenue. Crunchyroll’s business model is unique in that users pay them to view high quality versions of the content, much of which is copyright infringing. That certainly weakens their reliance on the Digital Millennium Copyright safe harbor provision, which protects service providers from liability for content uploaded by users. The safe harbor provision only applies if the service provider “does not receive a financial benefit directly attributable to the infringing activity.” It is arguable as to whether advertising around copyrighted content is a direct financial benefit, but it is even more difficult to suggest that a direct subscription fee, even if it is classified as a “donation” doesn’t trip the clause. Either way, Crunchyroll is certainly pushing the envelope as to acceptable behavior under the DMCA. Stretching The Limits Is Often Lucrative What’s interesting is that some of the worst offenders when it comes to copyright law have ended up doing very well. ALLOfMP3 continues to stay in business despite being sued for $1.65 trillion by the RIAA. YouTube, the king of infringers, sold to Google → Read More
San Francisco based HotOrNot, a popular online dating site which has broken most of the de-facto rules of running a silicon valley startup, is shaking things up again. For the last several months they’ve been testing a new service called Hotlists, which lets users add a little brand bling to their profile and build out their identity through association. Co-founder James Hong writes about the new product on his blog today. I interviewed Hong last week in anticipation of this post – hear the podcast over on TalkCrunch. HotOrNot users have been able to add descriptive tags to their profiles for years (well before “tags” were made popular by sites like Technorati and Flickr). But Hong and co-founder Jim Young wanted to let people add a visual “tag” too, and even let social networks pop up around these tags. So they added quietly added “Hotlists” earlier this year, letting users add a brands, people, things, whatever to their profile along with a visual cue. Already, a significant portion of HotOrNot’s users have added things to their HotList, even though the site has not promoted the feature at all. People just see it on other profiles, then add it to their own, too. The profile above shows Hong’s Hotlist, which includes brands like Sprint, Nike and Apple, as well as the band Snow Patrol and others. Users can add anything at all to their Hotlist – if it doesn’t exist there is a simple process for creating it, adding an image and descriptive keywords. All users who then add it to their profile are linked in the service, and there is a dedicated page for each item that shows all users who’ve added it and lets people leave comments. The purpose of Hotlists, says Hong, are to bring people together who have similar interests, something the site has done a very good job at over the years (up to ten marriages per day occur between people who’ve met on the service). But it also happens to be a brilliant business strategy, too. Hotlists tell HotOrNot exactly what brands, bands, movies, TV shows and other cultural trends their users like. HotOrNot will learn over time to spot new trends (the hot new bands, for example), as they begin to rise in popularity in the Hotlists. And they will be able to market stuff to their users with a previously unheard of degree → Read More
Read this excellent post by James Hong, co-founder of the nearly seven year-old startup HotorNot. He talks about the history of the startup, and touches on where it might be going in the future. A lot of this I wrote about last month after interviewing Hong, but there’s lot of additional information that people will find fascinating. The company never raised venture capital, and was throwing off a significiant amount of cash early on. As free dating competitors emerged, however, the popularity of the site declined. They responded by going free as well (killing a $500,000/month revenue stream), and traffic has doubled to around 20 million daily page views. HotorNot is now looking more like a traditional startup – they’ve converted to a C corporation and are giving stock options to employees. That suggests a sale or venture financing might be coming up in the near future. Of course, the amount of fun that Hong and cofounder Jim Young are having. My favorite stat about HotorNot: Up to ten marriages per day can be tracked to couples who originally met at the site. → Read More
When James Hong and Jim Young founded HotorNot in October, 2000, they had no real plans for the service to be anything other than a fun site for a few friends. They turned a free low end computer they received for setting up an etrade account into a web server, launched the site from their house in Mountain View, California, and emailed 40 friends. By the end of the day, 40,000 people had visited the site, which now had 30 second load times. It wasn’t too long before the service was hosted at RackSpace and the users were flooding in to rate user-uploaded pictures of themselves on a scale of 1-10. In January 2001 they added a dead simple dating site. Instead of reading endless profiles and trying to find a connection, users just say yes or no to a given picture. If it’s a yes, the other person is shown your picture the next time they look through profiles. If they like you as well, a connection is made. The Money Rolls In Until last month, HotorNot was free until that last crucial stage when two people wanted to meet each other. At that point, one of the members (usually the man, Hong tells me) must have been a paid subscriber, which costs $6/month. Hong says their conversion rate was extremely high – 15% of active users eventually upgraded to premium accounts. The premium revenue, plus advertising and fees for virtual flowers, soon topped $600,000 per month. Nearly all of that was profit for the two founders, who reportedly pocketed $20 million or so between them over the years. The company has never raised any outside funding. Hong says they receive 2-3 emails per day telling them about marriages that resulted from an initial meeting on HotorNot. In the last year though a few competitors have popped up (see yesnomayb, a copy of the business model) and a number of free dating sites also started to eat away at traffic. Traffic started to drift sideways, and the developers were getting bored at doing little more than site maintenance. Going To A Free Model That’s when Hong and Young decided to rip apart their business model and remove the requirement for members to have premium accounts to talk to each other. A month ago, the requirement was turned off, and about $500k/month in revenue disappeared overnight. The founders also turned → Read More
San Francisco, CA
