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Startups to watchIt's getting crowded on the Web 2.0 frontier, but there are still some startups that truly stand out. Business 2.0 Magazine identifies the ones most likely to strike gold in 2007.
Co-founder Garrett Camp (shown right), who totes around a mid-'80s Nikon F3 (yes, with actual film), came up with the idea as he was working on a master's in software engineering. Frustrated as he tried to indulge his hobby online - "There wasn't a good way to find the best photo sites," Camp says - he tapped his own background in clustering technology. With coding help from Justin LaFrance and Geoff Smith, he created an early version of StumbleUpon. Having nailed the photo problem, the team quickly saw how the technology could click with all sorts of media. In the same way that it matches users with like-minded websites, StumbleUpon's technology also pairs online ads with targeted demographics and interests. Now StumbleUpon is attempting to do the same for online video and video advertising. In December the startup launched StumbleVideo, a service that offers the closest thing to channelsurfing that you'll find on the Web. Tell us what you think about StumbleUpon's model: Is it the next MySpace? Funding: $1.5 million (Ron Conway, Mitch Kapor, Josh Kopelman, Brad O'Neill, Ram Shriram) Headquarters: San Francisco Employees: 12 Founded: 2001 Business model: Advertising, subscriptions Bragging rights: Cash flow positive Next up: New features like content controls and mobile video recommendations Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: Not disclosed (Peter Thiel, Vinod Khosla, others) Founder & CEO: Max Levchin (shown right) Headquarters: San Francisco Employees: 45 Founded: 2004 Business model: Advertising, subscription Bragging rights: Actor Jamie Foxx and Playboy founder Hugh Hefner use Slide on their MySpace pages. Next up: Doubling staff in 2007; expanding into Asia; adding mobile phone features Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Founders: Michael Birch (also CEO), Xochi Birch (shown right) Headquarters: San Francisco Employees: 28 Founded: 2005 Business model: Advertising Bragging rights: Profitable; advertisers include Disney, Alltel, Dawn and AOL) Next up: Promoting new Bebo Authors channel (launched Feb. 22); hiring in-house sales team Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $12.5 million (Draper Fisher, Jurvetson, Sequoia Capital) Founders: Sandy Jen, Seth Sternberg (also CEO), Elaine Wherry (shown right) Employees: 12 Business model: Advertising Bragging rights:: 5.3 million unique instant messenger IDs per month Next up: Doubling staff in 2007 Contact: Daniel Bernstein, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Launched in 2004, Wikia communities range from fans of 24 to politics junkies. Wikia is also working on an open-source, user-generated search engine. Funding: $4 million (Amazon.com, Marc Andreessen, Bessemer Venture Partners, others) Founders: Angela Beesley, Jimmy Wales (shown right) Headquarters: San Mateo, Calif. Employees: 33 Founded: 2004 Business model: Advertising Bragging rights: 500,000 articles in 45 languages Next up: Hiring; expanding into Japan; adding more languages; developing open-source search engine Contact: Angie Shelton, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
The duo behind peer-to-peer services Kazaa and Skype will officially launch Joost this spring, aiming to merge the best of TV with the best of the Net. The service provides more of a television-style experience than current online video sites, with channels you can flip through randomly or program yourself. Viewers can also share playlists of their favorite shows with friends or chat with them online while watching the same program. Joost will be free, supported by highly targeted ads based on people's actual watching habits, their friends' viewing patterns, and information they volunteer. Ad revenue will be split between Joost and the content owners. Joost can offload much of the heavy bandwidth and storage costs borne by Web video companies like YouTube because the service is a partial peer-to-peer system, with content distributed among viewers' computers. And to reassure Hollywood moguls who watched the music industry get burned by Kazaa's legions of illegal file sharers, all Joost video is streamed and encrypted. Tell us what you think about Joost: Will the Skype founders beat YouTube? Funding: Not disclosed Founders: Janus Friis, Niklas Zennstrom (shown above) Headquarters: Luxembourg Employees: 100 Founded: 2006 Business model: Advertising Bragging rights: 40,000 beta testers; just beat rival YouTube by signing major content deal with Viacom; other content providers include National Geographic, Warner Music Group, and Dutch TV production company Endemol Next up: Striking more content deals Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $750,000 (Hank Barry, Evan Williams, others) Founder & CEO: Mary Hodder (shown right) Headquarters: Berkeley, Calif. Employees: 11 Founded: 2005 Business model: Advertising Bragging rights: 12,000 registered users to date; partnerships with MySpace, YouTube, Grouper, Brightcove Next up: Hiring; a groups feature for users with similar interests to share video Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $20 million (Accel Partners, Benchmark Capital) CEO: Erick Hachenburg (shown right) Headquarters: Palo Alto, Calif. Employees: 65 Founded: 2003 Business model: Advertising Bragging rights: 17 million monthly users; revenues doubling each quarter Next up: Hiring 100 employees in 2007; partnering with movie studios, record labels and producers
Funding: $1 Million (Adelson, Marc Andreessen, Ron Conway, others) Cofounder & CEO: Jay Adelson (shown right) Headquarters: San Francisco Employees: 7 Founded: 2005 Business model: Advertising Bragging rights: 1.5 million monthly viewers; advertisers include Sony, IBM and Go Daddy Next up: Launching up to 4 new shows Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: Not disclosed (Ron Conway, Mark Gerson, Ken Lerer, Peter Thiel) Cofounders: Dina Kaplan, Mike Hudack (also CEO; shown right with Kaplan) Headquarters: New York City Employees: 12 Founded: 2005 Business model: Licensing, advertising Bragging rights: 45,000 content creators; key advertisers include Dove, Paltalk; licensors include CNN, Oxygen TV Next up: Doubling staff in 2007 Contact: Mike Hudack, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
But finding a Wi-Fi signal when you need one can be a problem - and a big opportunity for Fon, a Spanish company that's building a global community of hotspots one router at a time. The idea for Fon hit founder Martin Varsavsky in late 2005 while he was strolling through Paris with his PDA in search of a signal. Companies like T-Mobile were spending millions of dollars to build hotspot networks and charging dearly for access. Varsavsky, however, saw the potential for a worldwide Wi-Fi network in the home broadband connections already in place. All that was needed was a service to tie them together. Here's how it works: Fon sells a $30 wireless router to consumers. They hook it up, register their node, and agree to share their broadband with other "Foneros" for free. Those who want to charge outsiders for access can do so, and Fon gets a cut. Likewise, if someone wants to pay $2 or $3 to use the Fon network for a day, Fon takes a share of that revenue. Just over a year old, Fon's network boasts more than 70,000 hotspots. Initially focused on Europe and Asia, Fon plans a big push in the United States in the coming months. Tell us what you think about Fon: Is the company a Web 2.0 winner? Funding: $22 million (Google, Index Ventures, Sequoia Capital, Skype) Founder: Martin Varsavsky (shown above) Headquarters: Madrid, Spain Employees: 90 Founded: 2006 Business model: Subscription, router sales Bragging rights: 400,000 users (including 40,000 Americans added since October); signed as-yet unannounced deal with first major U.S. broadband service provider Next up: In deal talks with U.S. cellular service provider Contact: Faisal Galaria, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $5 million (New Enterprise Associates, Sequoia Capital) Founder & CEO: Sam Altman (shown right) Headquarters: Palo Alto, Calif. Employees: 18 Founded: 2005 Business model: Advertising, subscription Bragging rights: Partnership with Sprint Next up: Signing up sponsors; in talks with second U.S. carrier Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $9 million (InterWest) Founder & CEO: Ramneek Bhasin (shown right) Headquarters: Cupertino, Calif. Employees: 40 Founded: 2005 Business model: Advertising Bragging rights: Sprint and Cingular customers will be able to download widgets to their phones this spring; working with OpenTable, an online restaurant reservation service. Next up: Service launches Feb. 26 Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $2.8 million (Mohr Davidow Ventures) Founder & CEO: John Poisson (shown right) Headquarters: San Francisco Employees: 12 Founded: 2005 Business model: Sales of downloadable client, advertising Bragging rights: 55 percent monthly user growth; 500,000 videos and pictures swapped on network per month; SunCom Wireless plans to distribute Radar Next up: To have 1 million users by year-end; sign up more carriers; add premium subscription service Contact: Amanda Krantz, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $6 million (Clearstone Venture Partners, Intel Capital) Cofounder & CEO: Martin Frid-Nielsen (shown right) Headquarters: Campbell, Calif. Employees: 30 Founded: 2005 Business model: Subscriptions Bragging rights: Approx. 250,000 users; partnerships with Swisscom, WebEx Next up: Premium services Contact: Abbe Patterson, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Call it pay-per-play. To get started, advertisers first enter the prices they're willing to pay for various results - $5 for a sales lead, say, or $50 to $60 for a completed transaction. Next, they upload their text-or graphics-based display ads. Turn's software then analyzes the ads using more than 60 variables - including content, brand strength, and keywords - and determines the right publishers to serve up the ads. Turn splits the revenue (70-30, on average) with the publisher. Since launching in beta in November, the company has signed up more than 1,000 advertisers and cranked more than 5 million ads through its analysis engine. Twenty-five publishers are giving the system a tryout, according to Barnett, including a few large news sites and a big social network (which he declines to name). As for competitive threats, Google has been rumored to be working on its own version of the pay-per-play model. But Barnett says the $16 billion-a-year online ad industry is growing so fast that he doesn't worry about Turn's ability to carve out a lucrative niche: "These days marketers need to use all the targeting approaches they can find." Tell us what you think: Will Turn's pay-per-play model succeed? Funding: $17.5 million (Norwest Venture Partners, Shasta Ventures, Trident Capital) Cofounders: Jim Barrett (also CEO), John Ellis (shown above) Headquarters: San Mateo, Calif. Employees: 26 Founded: 2005 Business model: Advertising Bragging rights: 25 million unique viewers to date; 1,000 advertisers; 20 publishers Next up: Signing more publishers Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $8 million (Venrock Associates) Cofounder & CEO: Larry Braitman (shown right) Headquarters: San Bruno, Calif. Employees: 40 Founded: 2005 Business model: Advertising Bragging rights: 4,000 publishers have signed up, including The Washington Post; revenues doubling quarter-over-quarter Next up: Signing more publishers Contact: 877-462-3439
Funding: $4 million (Sequoia Capital) Founder & CEO: Omar Hamoui (shown right) Headquarters: San Mateo, Calif. Employees: 22 Founded: 2006 Business model: Advertising Bragging rights: 800 publishers, 250 advertisers Next up: Technology to deliver interactive ads to mobile phones Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $60 million (CBS, Interpublic Group, WPP) Cofounders: Nick Grouf (also CEO), David Waxman (shown right) Headquarters: Los Angeles Employees: 150 Founded: 2004 Business model: Advertising Bragging rights: Clients include Century 21, Coldwell Banker, Mozilla, and Warner Independent Pictures; partners include The Interpublic Group of Companies, WPP, CBS Next up: Extending the model to other media besides TV, possibly radio and the Internet Contact: 877-287-2793
Funding: $5 million (Comcast, Ron Conway, General Catalyst Partners, Turner Broadcasting) Founder & CEO: Reggie Bradford (shown right) Headquarters: Atlanta, Ga. Employees: 38 Founded: 2006 Business model: Advertising Bragging rights: 100,000 site users; site on VH1.com Next up: Developing new sites for youth-oriented media clients Contact: Maria Sanzone, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
They can. And when they actually work, watch out. SuccessFactors, a profitable five-year-old startup in San Mateo, Calif., takes in an estimated $100 million in annual revenue by selling a suite of simple Web-based tools that automate important but previously paper-driven management chores - performance reviews, succession planning, and compensation. Ultimately the service helps to match employee skills with company objectives. North Carolina-based Quintiles, a pharmaceutical services firm with 17,000 employees, deployed SuccessFactors last year to better pair worker aptitudes with jobs; its annual employee churn rate subsequently fell by nearly a third. CEO Lars Dalgaard claims that SuccessFactors has some 2 million users and more than doubled sales last year. Its customers, which pay an annual fee of $50 per user, range from small tech companies to corporate giants like ConAgra Foods. That kind of growth has not gone unnoticed among investment bankers, prompting talk of an IPO this year. Tell us what you think of SuccessFactors: Has the company created the ideal corporate tool? Funding: $45 million (Canaan Partners, Cardinal Venture Capital, Emergence Capital, others) Founder & CEO: Lars Dalgaard (shown above) Headquarters: San Mateo, Calif. Employees: Approx. 400 Founded: 2001 Business model: Subscriptions Bragging rights: 1,200 customers, including Wachovia, MasterCard, and Kimberly-Clark; 2 million users Next up: Expanding into Asia and Europe; developing web services tailored to specific industries, such as health care and retail Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $1 million (founders) Cofounder & CEO: Scott Kveton (shown right) Headquarters: Portland, Ore. Employees: 11 Founded: 2006 Business model: Advertising, subscriptions Bragging rights: 50,000 users (nearly double the number in December) Next up: Partnerships with bigger websites; new product rollout by summer Contact: Scott Kveton, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $16.8 million (Benchmark Capital, Highway 12, Shasta Ventures) Founder: Morgan Lynch (shown near right) CEO: Paul Brockbank (shown far right) Headquarters: Lindon, Utah Employees: 120 Founded: 2001 Business model: Fee-for-service Bragging rights: 65,000 customers to date, including Toyota and Pfizer Next up: Selling services to small businesses through big box retailers Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Funding: $100 million (American Express, Foundation Capital, Vinod Khosla, Burt McMurtry, Oak Investment Partners) Founder & CEO: Patrick Grady (shown right) Headquarters: Foster City, Calif. Employees: 155 Founded: 2000 Business model: Subscriptions Bragging rights: Approx. 200 customers; new partnership with American Express Next up: Expanding into the mobile market Contact: 877-778-2763
Funding: $5 million (Tom Iovino, Claude and Jan Nahum) Founder & CEO: James Siminoff (shown right) Headquarters: New York City Employees: 8 Founded: 2003 Business model: Subscriptions Bragging rights: 5,000 users Next up: Deal with major national carrier to be announced in April Contact: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it |
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