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Winning on the Internet is part skill, part luck. There’s no doubt that Google got lucky when they stumbled onto the cost per click model, and when Yahoo decided to basically give them their entire search results business. But Google has also been incredible smart and has made some absolutely brilliant decisions in their short ten years. But for every Google, there are ten or 100 companies that are dead or dying that either weren’t lucky, or weren’t smart. Here’s my list of the top ten companies that “should have been” but are now basically watching from the sidelines.
1. Salon.com. Before blogging was cool or content was monetizable, there was Salon.com, a site that drew millions of visitors with high-disposable income. Salon.com figured that the best way to make money off these visitors was to charge them a subscription fee. When that didn’t work, they decided to make visitors watch minute-long informercials before they could read any content. In both cases, visitors basically just decided to go elsewhere. Today Salon.com is worth about as much as a mildly-popular blog – the Company’s market cap is $425,000!
2. Productopia. You’ve probably never heard of this site, right? Well, at some point in 2001, it was about as popular as Dealtime, BizRate, Nextag, or any of the other nascent comparison shopping engines. When the bubble burst, however, the Company’s investors got scared and withdrew funding. Imagine if they had stayed afloat – considering their competitors all got sold for between $400 million and $1.6 billion, I think they would have been OK.
3. Classmates.com. I’ve mentioned this one before. Imagine a “social” Web site that “networks” you and your friends. Gee, that sounds like something Microsoft might value at $15 billion. Unfortunately, Classmates decided that the best way to make money was to charge users monthly for a crappy site and use misleading advertising to sign up new subscribers.
4. ValueAmerica. Back in 1998 or 1999, this company was basically an Amazon wanna-be. I actually ordered a stereo from this site and was pretty happy with it. The problem was, however, that they gave me a $100 coupon on a $150 stereo – not the most profitable customer acquisition strategy. The site ended up going bankrupt and a series of shareholder lawsuits and accusations against the CEO followed.
5. WebVan. Do I really need to mention this one? Great idea, happy customers, and one billion spent on infrastructure before they had enough business to support it.
6. AOL. Lots of customers, dominant marketshare. Terrible customer service, inability to innovate, bloated infrastructure. Today it’s basically a legacy domain name that is slowly fading into oblivion.
7. CRGazette.com. OK, this is a personal one for me. This is a great Iowa newspaper. At first, they offered all their news stories for free, but someone in upper management decided that they needed to restrict access to subscribers-only. So I stopped reading and found other sources for Hawkeye sports information. Later they changed their mind and they now offer free articles, but I’ve moved on.
8. Fark. OK, I guess this is still pretty popular, but really why isn’t Fark Digg and Digg non-existent? Probably because Fark was sort of a cult of personality and never bothered to use any technology to get better.
9. Internet.com. Imagine what you could do with a URL like this. Really the possibilities are endless. Instead, Jupiter Media seems to treat it like a parked domain. This site is currently barely in the top 5000 Internet sites. You own the URL and you can barely crack the top 5000. Wow, now that is pathetic.
10. Yahoo. The number one missed opportunity of all time. All hail the incompetent management at Yahoo. And yes, I still haven’t sold my stock yet . . .