Comments on: Question for FB app developers: How do you avoid becoming a 3rd-tier Slide.com? http://andrewchenblog.com/2008/02/08/question-for-fb-app-developers-how-do-you-avoid-becoming-a-3rd-tier-slidecom/ Essays on viral marketing, freemium, and social gaming Sun, 07 Mar 2010 15:07:14 -0700 http://wordpress.org/?v=2.9.2 hourly 1 By: jeremyliew http://andrewchenblog.com/2008/02/08/question-for-fb-app-developers-how-do-you-avoid-becoming-a-3rd-tier-slidecom/comment-page-1/#comment-385 jeremyliew Sun, 10 Feb 2008 01:50:07 +0000 http://andrewchenblog.com/2008/02/08/question-for-fb-app-developers-how-do-you-avoid-becoming-a-3rd-tier-slidecom/#comment-385 <p>I spoke to the Stanford Facebook class on exactly this topic. Link here:</p> <p><a href="http://lsvp.wordpress.com/2007/11/16/business-models-for-apps-and-widgets/" rel="nofollow">http://lsvp.wordpress.com/2007/11/16/business-models-for-apps-and-widgets/</a></p> <p>At the time, I concluded that there were two winning strategies:</p> <p>1. Be an "at scale" portfolio of broadly focused apps (like Rockyou and Slide). [Disclosure: Rockyou is a Lightspeed portfolio company]<br /> 2. Pick a vertical with a double digit CPM opportunity (typically something with endemic advertisers and high budgets like movies, fashion, auto, health etc) and drive a deep, highly engaging app. [Disclosure: I'm an investor in Flixster]</p> <p>Note that I don't hold these points of view because of the investments, but rather I made these investments because of these points of view.</p> <p>Since then, I've concluded that there are also opportunities in social games since they have the combination to drive both viral growth and high engagement, and open up the possibility for digital goods business models. Link here:</p> <p><a href="http://lsvp.wordpress.com/2007/12/20/games-20-social-gaming-on-facebook/" rel="nofollow">http://lsvp.wordpress.com/2007/12/20/games-20-social-gaming-on-facebook/</a></p> <p>This isn't to say that small teams can't make a good living out of building good engaging apps. They can make very nice lifestyle businesses. But they may run into trouble if they try to build very large, valuable companies for the reasons that you outlined</p> I spoke to the Stanford Facebook class on exactly this topic. Link here:

http://lsvp.wordpress.com/2007/11/16/business-models-for-apps-and-widgets/

At the time, I concluded that there were two winning strategies:

1. Be an “at scale” portfolio of broadly focused apps (like Rockyou and Slide). [Disclosure: Rockyou is a Lightspeed portfolio company]
2. Pick a vertical with a double digit CPM opportunity (typically something with endemic advertisers and high budgets like movies, fashion, auto, health etc) and drive a deep, highly engaging app. [Disclosure: I'm an investor in Flixster]

Note that I don’t hold these points of view because of the investments, but rather I made these investments because of these points of view.

Since then, I’ve concluded that there are also opportunities in social games since they have the combination to drive both viral growth and high engagement, and open up the possibility for digital goods business models. Link here:

http://lsvp.wordpress.com/2007/12/20/games-20-social-gaming-on-facebook/

This isn’t to say that small teams can’t make a good living out of building good engaging apps. They can make very nice lifestyle businesses. But they may run into trouble if they try to build very large, valuable companies for the reasons that you outlined

]]> By: Martin http://andrewchenblog.com/2008/02/08/question-for-fb-app-developers-how-do-you-avoid-becoming-a-3rd-tier-slidecom/comment-page-1/#comment-384 Martin Sat, 09 Feb 2008 19:45:49 +0000 http://andrewchenblog.com/2008/02/08/question-for-fb-app-developers-how-do-you-avoid-becoming-a-3rd-tier-slidecom/#comment-384 <p>Build something relevant and engaging. </p> <p>Don't try re-inventing the wheel (aka don't make yourself a "me too"). You don't need tons of cash to achieve this; you only need some good ideas, launch quick, test and make it a continuous improvement process.</p> <p>Also don't try to be everything for everyone. In other words, focus. Whether it's for a vertical, a media type, a demographic or something else. If you find a winning combination then build on it (user growth and make it defensible).</p> Build something relevant and engaging.

Don’t try re-inventing the wheel (aka don’t make yourself a “me too”). You don’t need tons of cash to achieve this; you only need some good ideas, launch quick, test and make it a continuous improvement process.

Also don’t try to be everything for everyone. In other words, focus. Whether it’s for a vertical, a media type, a demographic or something else. If you find a winning combination then build on it (user growth and make it defensible).

]]> By: Kavin Stewart http://andrewchenblog.com/2008/02/08/question-for-fb-app-developers-how-do-you-avoid-becoming-a-3rd-tier-slidecom/comment-page-1/#comment-383 Kavin Stewart Fri, 08 Feb 2008 23:40:49 +0000 http://andrewchenblog.com/2008/02/08/question-for-fb-app-developers-how-do-you-avoid-becoming-a-3rd-tier-slidecom/#comment-383 <p>Hey Andrew, it was nice meeting you at lunch today. I think you bring up some good points, but their reach is more like 4x that of some of the larger independents. At least on Facebook.</p> <p>I'm going by the number of installs listed on adonomics -- same holds true for other relevant stats.</p> <p>Drop me a line, I'd love to continue this debate :).</p> <p>Kavin</p> Hey Andrew, it was nice meeting you at lunch today. I think you bring up some good points, but their reach is more like 4x that of some of the larger independents. At least on Facebook.

I’m going by the number of installs listed on adonomics — same holds true for other relevant stats.

Drop me a line, I’d love to continue this debate :) .

Kavin

]]> By: CG http://andrewchenblog.com/2008/02/08/question-for-fb-app-developers-how-do-you-avoid-becoming-a-3rd-tier-slidecom/comment-page-1/#comment-382 CG Fri, 08 Feb 2008 23:15:42 +0000 http://andrewchenblog.com/2008/02/08/question-for-fb-app-developers-how-do-you-avoid-becoming-a-3rd-tier-slidecom/#comment-382 <p>Since these companies only build lame, meaningless apps (superpoke, funwall, glitter text, etc), focusing on something that actually builds some real value should prove to be defensible ;). Do they only use virality as their criteria for new "products"?</p> <p>If you're a small team who can focus on building something that isn't incremental to a slide, rockyou, et al. app, I wouldn't worry about them being that fast to follow. A couple of Facebook developers are to Slide as a start-up is to an established tech company; same points of advantage.</p> Since these companies only build lame, meaningless apps (superpoke, funwall, glitter text, etc), focusing on something that actually builds some real value should prove to be defensible ;) . Do they only use virality as their criteria for new “products”?

If you’re a small team who can focus on building something that isn’t incremental to a slide, rockyou, et al. app, I wouldn’t worry about them being that fast to follow. A couple of Facebook developers are to Slide as a start-up is to an established tech company; same points of advantage.

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