If anyone ever questions the value of the idea versus the value of execution, use this as a cuationary tale. Here's my post outlining this very idea from 2 years ago:
2 years. I even registered the domain my3words.com.
What did I do with it? Not much. I have no idea if Mark saw my post or not. I kind of hope he did, so that I can feel a little better about not executing. That maybe I inspired him.
However, that doesn't change the bottom line. He executed. Worth-ful. I had the idea, but didn't execute. Worthless.
Wow. That is definitely a wake up call to execute. Motivates me to finish some hanging ideas. I'd love to see Mark's comment on this.
Nice work on phone 7 btw. I really enjoy it. I just wish scrolling performance wasn't so damn hard to get right. Since I wouldn't normally get your attention how do you go about getting an app featured in the marketplace? [whoring] My latest app isn't the most awesome thing ever but it's fun for kids and it tombstones correctly. http://wp7.apphab.com/sticker-draw-by-ideaindustries-net/ [/whoring]
Agreed. I picked up twentytwelve.net a couple of years ago (I was surprised to find it completely unregistered at the time) and have several ideas for making a bit of side-money out of it - but having ideas and making plans is worth nothing if you don't find the time and enthusiasm to actually implement something and support it afterwards.
Maybe at some point this year I'll pull my finger out and find time to do something meaningful with it, before the window of relevance runs out...
1) building a prototype (which, knowing Mark, I'd say took him at most 2 days)
and
2) sticking with it for several years and making it profitable, through the thick and thin, the emotional roller coaster, and all that.
It took me a year to complete stage (1) and I'm still on stage (2), three years later.
My web app (a casual MMO game) had the same wave of organic growth in the beginning that Mark's had, was mentioned on top blogs in the game industry, played by news anchors on live local TV news half a country away, etc., (this list goes on and on). Yet my site never got drooled over on Hacker News or Tech Crunch (possibly because I never submitted it to either), and I never had all these people telling me how great I am, how awesome my idea was, and sounding so sure that it will make me rich.
My site has 10x more users than threewords.me, been cloned by many developers in various countries around the globe, and still retains the top spot among those competitors. In fact, it seems that I actually invented a new genre of games with my idea (how many people get to say they invented Tetris, FPS, RTS, RPG, or MMO?)
All this, and yet I'm still barely making more from the site than I could be making from working at McDonald's. Yet I persist. It's been my full-time job for the past 3 years (the web app, not McDonalds :)), ever since I parted ways with my well-salaried software engineering job.
If anyone is tempted to call me stupid or lazy for not making millions from my idea, I'll be the first to admit that maybe I am. I didn't do any marketing or emailing Arrington, or any of the like. Instead I've been focused on building what my users want, developing features, fighting fires, and talking to users (many of whom constantly criticize me for not pushing out new feature fast enough).
Not a single real user ever said to me "Wow, this will make you rich," it's always more like "Wow, I LOVE your game! Please add features X, Y, and Z. They are super important! Hope to see X, Y, and Z working soon!"
Therefore, I sometimes think the startup community needs a dose of sanity. Not every tiny app is going to make millions. The web economy seems like a gold rush for many. If threewords.me makes any real money from this sale, it will be due to the exposure it's received to people participating in that gold rush.
In conclusion, I'd like to say that my comments are not intended just for criticism. If any of you think you know how you could make tons of money from threewords.me or from a casual MMO game (that doesn't have any virtual goods to sell), then I hope you can tell us how you would do it, rather than making assumptions that somehow anyone can get rich by building a free app and getting several hundred thousand people to sign up for it.
(P.S. Mark, I think you're a great guy and your app is very nice, so please don't take my comments the wrong way - I'm just trying to add some perspective to this discussion.)
I prefer to stay anonymous on here, but I can be reached by this same username on Gmail if anyone wants to know more.
I'll just say that it's a very simple skill-based, text-based multiplayer race-against-others game (something like a multiplayer speed Scrabble). It has almost no graphics and uses AJAX.
how is it not earning a livable wage with 2 million users?
It's livable if you have very low expenses, but in my limited experience, 2 million users just aren't enough for a free website to make good money. Maybe I'm hugely under-monetizing the site somehow, but I don't really see a good source of revenue other than from ads.
Most of us have plenty of ideas and not enough time to execute most of them. So we're more impressed when someone shows us something cool that's actually usable rather than another article about how someone had a vague idea for a cool thing that's supposed to become practical in another 10 years, but which we doubt will ever actually get produced.
In short, it's a lot easier to come up with an idea when you don't have to actually do the work to make it feasible. See also: "I have an idea, I just need a programmer or two."
Have you considered going to a larger company/brand like Dove and getting them to buy it? Your audience seems right in line with their audience and they probably already have a budget for "social media marketing". A good way to reach them might be a big-brand social media consultant like VaynerMedia.com. They could facilitate the sale and make a commission on the amount. I know someone who knows Gary over at Vayner so if you're interested, I could try to make the connection.
Alternatively, I can connect you with an investment banker who specializes in selling internet based businesses, though I'm not sure if he'll be interested since he typically deals in the 7-figures range... but I could run it by him if you want.
I just think having a simple private auction without attracting the right parties to the table might not get you the maximum the site could get. Just my thought.
Anyway, congrats on the success so far and good luck with things. My email is in my profile.
Hey Melvin — thanks for the suggestions! The only thing I'm not sure about is why a general brand would want a threewords.me-like property under them. What's a brand's motive for acquiring properties such as mine?
Good question. The motives for various brands will likely be different.
I had Dove in mind specific because it seemed like a good fit. Take a look at this video: http://www.youtube.com/watch?v=iYhCn0jf46U. It summarizes Doves message in a nutshell I think. They might be interested in your thing because it helps position their brand in front of their key audience (which I suspect are young women and your quantcast data shows a major of your audience were also young women) in a way that supports their message without the repulsiveness of commercials or banner ads.
In addition, the social media managers of these brands would love the opportunity to increase engagement with their audience. On a personal level for the managers, it would give them specific metrics they could reference when talking about how their social media efforts are going. On a company-wide level, the more deeply they connect with their customers, the more products they'll sell.
If you did go down the road of talking to brands, I'd position your product as similar to the OldSpice man campaign but a different tact.
I just think having a simple private auction without attracting the right parties to the table might not get you the maximum the site could get. Just my thought.
Obviously this is true, but it's arguably the quickest.
If Mark wants to flip it quickly to focus on other projects, getting drawn into a negotiation with commission-earning middlemen and lawyers who probably need to respect some formalized DD process, is probably counter-productive.
Yeah, I'm working on way too much stuff, and threewords.me started up as a side project that I didn't have any interest in continuing it long-term (more interested in developing http://supportbreeze.com and others).
The press curve has slowed, but a lot of users are still hitting the site (new and returning) — every new feature I get is hugely adopted within minutes.
Hey, one quick thing I noticed about supportbreeze.
I noticed a lack of clear confirmation when hovering the button "Get started for free" I can tell a faint color change however there is no clear indication of my selection.
Whereas hovering other links gives a visual mouse indication and a visual indication over the link.
Yeah, one of the things that I'm still trying to figure out is the exact amount of visual feedback that hovered elements should have... too much is gaudy, too little is not feedback-y enough. That button fell into the latter category, but I haven't had the time to rework it. Thanks for dropping me a note :)
Well, I take it that /he's/ promising not to spam. The same that I can promise that no crimes will happen in my home- it's only as good as long as it's _my_ home, not someone else's, and I can reasonably manage things.
Even with a friendly-reading T&C he'd be free to break it any time, as would any future purchaser. I'm not a laywer but I'd believe T&Cs exist more to protect a site than its users, presenting the general terms and conditions the users can expect a site to be presented under, not a guarantee of of the same.
Pre-existing contracts may be binding on someone who purchases a business. So the buyer of a web site might be bound by the TOS. Thus, a promise to customers could survive the company changing hands. (I can't speak to the particulars of this case, though.)
The flip side is that TOSs typically have some provision for amendment. Such provisions might be invoked by a company's new management. However, the management has to be careful even then, because of this: http://en.wikipedia.org/wiki/Standard_form_contract
Again, I'm not suggesting that any of this would necessarily apply to threewords.me. This is just my understanding of how it works in general.
BTW, I couldn't find a link to the TOS for threewords.me.
I'm genuinely curious why you suggest the growth curve on this is exponential at this point? I saw this thread on HN when he originally posted it, and while it wasn't something I would personally be interested in I imagined it might fit a certain demographic. The question for me was always the staying power with a quick hit site like this.
Now having seen a wider window of stats on the site from quantcast, all arrows are pointing down and to the right. I agree that he's smart to try to sell it, but only because the longer he holds onto it the less opportunity there will be to capitalize on the original spike.
If I was a digital agency/consultancy, I'd snap this up. I think it would be fairly easy to fork and customize for big brands that want to do Facebook promotions, reviews, focus groups, etc.
"Tell us your 3 favorite items at Applebee's ..."
"Thanks for trying the new filet mignon chalupa at Taco Bell. Describe it in 3 words ... "
"What 3 things are most important when choosing your next car? ..."
(I'm sure someone more creative could do better, but you get the idea)
I also did a test for using sentiment analysis as a monetization point, using the Amazon Kindle (question was, "What do you think of the Amazon Kindle?") which was displayed on top of the dashboard for all users, and it got something like 7,000 responses. The responses weren't amazing, but it is possible to improve them. There was zero targeting on whether or not the "sponsored listing" was displayed, whereas Smashing Mag's results are clean since the only people submitting words are people that know what Smashing Magazine is.
I only see spams from most of the msg. I think you are doing a right thing trying to capitalize while the hype is there. Based on alexa, it is dying out already.
How much revenue is generated from Threewords.me? Is it even profitable?
Also, I'm wondering how the process of transferring the actual website would go? Will the buyer usually take over the servers which the seller has setup?
Haha, hey everyone this guy thinks profitability with this matters! Everyone point and laugh!
I highly doubt even Mark thinks this product has legs with monetisation, it's a fad at best. He's clever for cashing in now, it'll be dead soon unless the new owner works out how to expand.
Let's just for a second pretend that I'd be an interested party (I won't be bidding).
I would assume that most of the people bidding are not 'players', I'd assume that they would just try to get it for a song and a bit, the equivalent of buying Manhattan from the Indians because they're not aware of what it's worth.
Mark is a smart guy so he won't be going for that.
The second group of potential buyers would be more savvy and would bid higher, they'd be outbidding each other bit by bit, probably in increments of 1,000 $US until they ran out of steam.
With the last moment of the bidding already announced the real players would wait until the very last moment and would then bid based on what the highest of the second group has bid using that as a way to guide their decision, in the hope that nobody else would be bidding a similar amount.
In a 'blind' bid like this, assuming a party really wants to get their hands on it they will have to decide what it's worth to them to get it, rather than to let the market do their valuation work for them. This may very well lead to substantially higher bids.
If I were Mark I'd add two things (if he decides to make the bidding public, which I would not advise him to do):
- Extend the bidding with 15 or 30 minutes after every new highest bid
- keep the identity of the bidders secret, just show the highest bid
Since he's already under way and it is difficult to change the rules once the game has started I don't think that is a viable option any longer anyway.
Sometimes the market works against you -- if the public bids stall out at a certain level, then one big buyer knows exactly what to pay. Private bid makes buyers guess against an idealized competitor.
This would probably help to increase the bid amount. Otherwise you're going to have a lot of people bidding the same things, or lower than the current highest bid. This will include a lot more email correspondence than required. Although, that might be better because it allows you to arbitrarily inflate the "current bid" on a per-bidder basis. So you can kind of inflate the bid behind the scenes too.
Disagree with public bids in this case. Perhaps the right approach for something that will be priced based on fundamentals or intrinsic value, but in this case the value will come from finding a visionary/strategic buyer. By definition these will be outliers thus public bids would put downward pressure on perceived value.
Does anyone know how much the 253,000 email addresses (userbase of threewords) could be worth to a company that runs another social platform?
I imagine that, regardless of whether threewords continues to grow, a related service (like formspring) could add threewords functionality to their own service, then email the threewords userbase letting them know what's up, and re-engaging them..
Is the response rate for those kind of emails pretty good, or would that not be a huge factor in the sale price?
OMG. Don't sell work it!! Work on it. You've gotten people to tag other people. Think of the possibilities.
So much better than a support system (done and done) IMHO.
Of course, if you have no interest in working with social space stuff, then okay, I can't argue with that. But the fact you launched this product means there's something there you want to do.
I'm not sure of how big the bids are so far but have you thought of open sourcing it?! The traffic is exhibiting decay as time goes by and only would be a while before it hits the graveyard. Might as well give others a chance to learn something from this project and tweak it to their ideas and relaunch it in some form.
I understand you have time constraints and other things on your plate, but it seems to me that you created an entirely new form of social interaction. I think your site is in the same league as http://formspring.me (which has $24m in funding).
I would hate for you to sell for 5 figures only to see a much higher valuation in only a couple of years.
Your concept is well executed and if you have traffic, you should be able to monetize without being too innovative. I like the idea of surveys or branded pages.
Thanks for your thoughts! I can't really say I'm having second thoughts, but more like 1.5nd thoughts... I just don't know where to expand from here. The concept is great and the virality is really cool, but... something just isn't there.
Something just isn't there, but only because you haven't added it yet...Your idea works as a concept, it just needs to be tweaked.
If you don't get a price you like, keep the site, add advertisements and collect data. As people's profiles fill up with qualities, you may be able to determine what kind of ads people are likely to click on.
I also like the idea of selling companies a spot where people can comment on their brand or different ideas. The site could evolve into a kind of instant survey for concepts and ideas (from brands). I.E. They post an image of a new design and the users can describe in 3 words what they think. It would allow a company to get instant feedback and know if they have a homerun or not before something is produced or fully developed.
Please don't take offense to this, Mark, but if you only have 30 minutes to work on this, then your priorities are very much in the wrong place.
You're talking about doing something that could make you real-world money that goes in the bank. Spend all of your time selling threewords, then use the money from that to fund your other ideas. Being "too busy" means that you're doing something wrong.
I'm sorry, I had a duplicate comment and deleted the wrong one before I saw yours. Thank you very much for these, hopefully my new projects won't look like mulch.
It's hard to estimate a reasonable price for this if you don't have any revenues. Whereas you could usually discount future cash flows, in this case you would need to estimate the goodwill - which probably means what you're willing to pay for maintaining this site as a hobby.
BTW. does this page still get a lot of hits? I've seen on my past projects (albeit on a much smaller scale) that those services usually spike for a few days and then quickly die off - what are the current usage statistics?
He always has the option to go to Flippa later if he doesn't get the value he wants here. From my limited experience, Flippa is kind of a liquidation market more than a source for competitive bids. Your mileage may vary.
probably because he wants to make more than $1K from the auction. Nothing wrong with Flippa...and I know from time to time they have a big value site listed...but as a rule...it's almost always complete crap
I think this is a great way to monetize your cool idea. Your site went viral in a few days and still has this potential. Please let us know how this went. We all have to think about monetizing our ideas this or other ways.
http://www.manyniches.com/n00b-notes/my3words/
2 years. I even registered the domain my3words.com.
What did I do with it? Not much. I have no idea if Mark saw my post or not. I kind of hope he did, so that I can feel a little better about not executing. That maybe I inspired him.
However, that doesn't change the bottom line. He executed. Worth-ful. I had the idea, but didn't execute. Worthless.
Hats off to Mark.