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September 19, 2005
Barney moderating a panel on Vertical Search: Show Me The Money
I'll be moderating a panel discussing Business Models in Vertical Search at the MIT Stanford Venture Lab event happening tomorrow, Tuesday September 20th, at Stanford University.
From the event announcement:
Remember the heydays of the first generation Internet search engines like InfoSeek and AltaVista and then of course, our darling Google? Vertical Search is now one of the hot new topics buzzing around the Internet industry and the investment community today. It refers to specialized search technologies that focus on narrow niches like a specific industry such as travel or health or new Web-based communication tools like blogs. Users can much more effectively find what they are looking for - be it cheap plane tickets or to find out what the investor community thinks about a certain technology. Businesses have much more effective way to reach their target customers. But the big question, as with first generation search, is Where is the Money? Though there is no question that there is value for vertical search, who is willing to pay for it? At the September 20th VLAB event, Scott Rafer, CEO of Feedster, will present how his company is building a business around providing vertical search for listings, news, and blogs, followed by a panel discussion moderated by Barney Pell, Entrepreneur in Residence at the Mayfield.
I was originally invited to participate as a panelist on this topic, with Wired Magazine's Chris Anderson moderating. But within a day of my accepting, the organizers told me that Chris had to cancel and they asked if I would be willing to moderate. This came at a really busy time for me as I was just about to leave for Burning Man, followed by two conferences, but given a topic so close to my interests I found it hard to decline.
At a broad level, I think the business models for vertical search are not particularly challenging. Search is typically supported by advertising, and vertical information services are typically supported by advertising, subscriptions, and commerce. Hence these are all natural revenue models for vertical search.
For any given vertical search business, the specific choices and mix of revenue in these categories will depend on the value of the vertical content to specific customer segments, the features of the user interface, and the integration into workflow and transaction streams. All this is modulated by the uniqueness of the offering and the corresponding reality or threat of competition.
I think we have an exciting group of panelists assembled:
- Scott Rafer is sure to stir up some controversy, as he did at the Vertical Leap event a couple months ago. In addition, as he has recently stepped down from CEO of Feedster, I hope he will share some candid lessons learned and advice for new players in the space.
- Reid Hoffman has much to say about people search in social networks and all the verticals that stem from this. One business model challenge in monetizing social networks (and other services with network effects) is that you often defer revenue while maximizing growth, and then monetize later. This causes cash-flow challenges for the early business, and user expectation challenges when you start charging them later. Reid has been through this now several times, so I think his perspectives will be valuable.
- Dion Lim's resume reads like a tour through vertical internet businesses, including finance, shopping, and currently jobs. Since SimplyHired and LinkedIn have partnered, we might also get Dion's perspective on how to build value through partnerships with other vertical search companies.
- I haven't yet met Paul Flaherty, but I expect he has a lot to talk about, based on his experiences as founder of Altavista and then as a corporate strategist. I am personally looking forward to meeting him.
If you have specific questions you'd like us to cover during the panel (before the general audience Q&A), please send me your thoughts or post them here as comments.
If you couldn't have planned to attend the event otherwise but want to go as my guest, send me a note and I'll try to put you on the guest list.
Posted by barney at September 19, 2005 9:21 PM
This entry was posted in the following categories: Search
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