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Closure

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83 pointsdmor17 comments

Slightly confused. Here: http://www.daniellemorrill.com/2013/03/zombie-startups/ they had ~130k "active monthly users" yet in that post they say they had ~15k? Not trying to be snarky, just curious what they are using to define the two groups.

No problem, only about 5% of our active users are contributors (this is pretty typical of user generated content sites as I understand it, although we always tried to make it higher). The rest are readers/subscribers

Makes sense, thanks!

1.2 Million page views, and $33k in revenue. That is a $30 CPM. Wow.

I wonder if they tried buying traffic for some of best performing articles. Probably not cost effective, but not far off.

462,291/372,195 = $1.24 => Spend Per Visitor

33,883/462,291 * 100 = 7.30% => Commission Rate

33,883/372,195 * 100 = 9.10c => Value of Incoming Click

33,883/3,356,379 * 100 = 1.00c => Value of Outgoing Click

Required middleman amplification ratio: 9.1 => Hard but workable.

33,883/10 = $3883 => Monthly income => Not workable.

I don't understand why a sudden closure. They were successful and were giving a tough competition to Amazon affiliates. Then why start an online magazine? They were receiving a massive amount of traffic just because they could earn better than Amazon affiliates. I might be wrong but were people writing articles? I mean who wants to be a paid freelancer when they can earn better thought a blog? Also, this Paid Freelance Contributor Program is kind of weird. We already have that!!

I'm proud to be in a community this transparent. Best of luck with the next one.

Pay attention, this is how you handle the public aspects of a pivot.

I don't understand that sentence. What is a pivot?

A pivot is when a company (usually a smaller company) decides that their current business model/idea isn't working, and "pivots" to another idea. Though to be fair, I arrived at this definition only by seeing it enough times on HN and defining it via context.

The word originally came from Eric Ries and the Lean Startup (I think). Pivot does indeed mean changing to another idea, though the emphasis is on "change direction with one foot on the ground", ie, not just scrapping everything to do something completely new. Though nowadays it seems pivot can mean everything from "slight change in direction" to "completely give up".

Squidoo 2.0

Not that it's a good or bad thing. Just noting the similarities of two ideas pushed through by two strong personalities--love you, mean it, dmor--that approached the editorial process with a means of monetization.

I believe the trick, as Mahalo learned early, is that you need a lot of traffic to draw from for this kind of model to ramp up and then work out a win for everyone with their fingers in the pie.

For my own startup junkie datapoint would any Amazon engineer please dish about lessons learned while productizing of, and the lack thereof, Amazon wishlists or tangentially Amazon Vine?

With a massive database of products, reviews, actions, tastes, recommendations, and traffic, that's a great nexus to apply a referral model to.

No offense taken, we looked to learn from Squidoo a great deal and Seth sent me a couple supportive notes along the way that meant a lot to me.

I still believe cost-per-action is the future of indirect revenue on the Internet and as fraud continues to climb in display and even CPC advertising I think things will head in this direction. But not yet.

It seems difficult to make good money with affiliate marketing. Example Amazon books: say I earn 1$ per book sale - that is about the same as for 10 clicks on an adwords ad on my site. If 10 people have clicked on an Amazon link, I haven't earned anything yet. So how can such things make sense? I guess you have to sell more expensive stuff, but I think Amazon has also capped the max affiliate reward now?

A pity, because I'd prefer to refer handpicked things to unpredictable AdWords on my site, but can't see it working.

Absolutely love the transparency. It's nice for founders to know that everyone else (even some of the best!) aren't always crushing it...but I'm betting you'll crush it next time around :) Good luck!

This is a beautiful way to show everyone that you guys know what you're doing and to build brand loyalty. Best of luck!

Man, startups are hard. B2C startups are really hard. Best of luck with the pivot!

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