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Comment by rizzom5000 | Hacker News Reader

Pinterest, Instagram, Groupon, Zynga, and "in some cases billions of revenue"? Unless I'm looking in the wrong places, that is a factual error.

While getting hundreds of millions of users is great, it's not quite the same as getting to profitability. If you're using Zynga and Groupon as success stories, your business model might very well consist of, "looking for the next big fad and hoping to find a way to monetize before it fizzles".

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"some" in this case was Groupon & Zynga, not Pinterest or Instagram. while perhaps not the best cases of getting to sustainable profitability, nevertheless both Groupon & Zynga did phenomenally well in customer acquisition and revenue... what they have failed at is long-term retention.

regardless, the argument Fred seemed to be making was that distribution and customer acquisition is getting "harder"... this is not the case.

both Groupon & Zynga did phenomenally well in customer acquisition and revenue... what they have failed at is long-term retention.

So, in other words, a great pump and dump scheme?

You make it sound as if their business models should have changed at some point in order to achieve both. Do you believe this is genuinely possible?

If the number of people on the internet isn't growing (and it has pretty much plateaued in the US, at least), and there are more competitors, then yes, I would say consumer is "getting harder." Good ideas will always buck the trend, of course, but I think there is going to be some consolidation in this space.

check the stats for both time online & online spend -- I'm sure both are still growing; even in the US. then add in the # of young / old people on smart phones and tablets that weren't online 3-5 years ago, and you could say that even raw # users in US is also growing.

Which, let's be honest, all worked out very well for the early investors.

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