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And the overpaying continues

edited October 2005 in Vanilla 1.0 Help
A site I visit pretty often, Digg, just got VC funding of 2.8 MILLION. Are you kidding me? 2.8 million? What were they smoking?

http://www.siliconvalley.com/mld/siliconvalley/business/financial_markets/venture_capital/13019053.htm

Comments

  • Crazy....the site looks useless, and like a lot of others I have seen lately. Looks cloned... I dont understand how websites like that get $2.8mill. Take MySpace for example. Its worth something like what $5million? Ever been there? Sure it is a great idea..but that site is a piece of shit. Works like shit, looks like shit, runs like shit. Its a heaping pile of shit. You would think a site worth $5m would be a little fscking better.
  • I want VC money :( Come on rich boys shell out some dough for a playboy wannabe!
  • MarkMark Vanilla Staff
    I could go for some VC money. Anyone care to spot me a few mil?
  • edited October 2005
    You guys really don't realise how much money is behind a lot of the internet. Internet advertising is a growing industry and a site like Digg makes a fortune. They get 500,000+ visitors a day, fyi, and digg is an original idea from the sites creator. That's why it's so popular. I'm really not at all surprised, Weblogs, Inc. (owners of Engadget, Joystiq, etc.) just sold to AOL for $20 million. For digg, I would call $2.8 million fair. Kevin Rose, the site's creator, came up with an extremely original and very popular concept.
  • Digg mainly targeted the Slashdot crowd, appeasing their enormous egos with a vote-based user moderation system. Unsurprisingly, it worked. I usually check both, because a lot of news doesn't get past the slashdot moderators, but the items that do are usually better-written than digg. I guess the big worry about web ads is that they tend to create an unstable system. As long as most of the ads point to sites that sell products, the system works fine. Once enough sites start making money purely off pageviews (like digg), they start advertising their own sites, and pretty soon you have a bunch of sites sending money back and forth between each other and thinking it's actual revenue. This attracts venture capitalists, who pour more money into the system, which everybody mistakes for enormous growth.
  • edited October 2005
    Bergamot: Thankfully, however, 99% of websites that actually pay for advertising are selling a product or service. Buying ads for a site that makes all it's profit from ads is a bit ridiculous, if not down right stupid financially speaking. You brought up an important point, though. The internet as an industry is set up for another bubble burst. While $2.8 million for digg isn't too bad, a few BILLION for skype show that we're headed for yet another dot com disaster. Once again, VC's are pouring money into a market that just isn't there. Oh well, life goes on. Get in and get is what I say. Good for digg.
  • MarkMark Vanilla Staff
    I would hardly call skype, a technology that has the potential to replace telephones and long distance charges and revolutionize the world, a market that "isn't there".
  • a few BILLION for skype show that we're headed for yet another dot com disaster

    Sorry, have to disagree with you there, Skype has completely changed the way I make phone calls and communicate online, I personally think eBay got a bit of a bargain.
  • Why is it that when you capitalize "million" or "billion", it runts it into milliln" and 'billiln"?
  • edited October 2005
    BILLION
    woah. wierd.
  • lechlech Chicagoland
    I would hardly call skype, a technology that has the potential to replace telephones and long distance charges and revolutionize the world, a market that "isn't there".

    One use I can see Skype trumping up the phone system is when WiFi spots become so prevalent and saturate areas, that you can walk around with a pocket PC and have it double as a phone. All in all, it's free, pretty damn easy. It's either paying out the ass for long distance charges, or using skype over your internet connection and not paying any extra. Sure it's nothing new, but it's useful :)
  • myspace was $5mil, I thought I heard that it was $500 mil, but then again that was on the internet that I heard it.
  • I await the next big internet crash.

    Hopefully by then I will have sold my utterly wothless site through clever hype and marketing. Then I can retire and live out my days doing fuck all. Bliss.
  • Something weird is going on with capital letters, I thought I was going mad yesterday when I posted an extension code and HeadScript became HeadPcript, but billion, and one in this post have been altered, bizarre.
  • NickENickE New
    edited October 2005
    Oh hell, I see what's the matter. The P in the HTML formatter fix should be S and the L needs to be O That's why all 'ON's and 'Scripts' turned into 'LN's and 'Pcripts'. I'll alert mark to my dumb mistake...
  • thank god, I really thought I was suffering premature dementia.
  • edited October 2005
    Stuart, you miss the point. Skype's anual revenue is less than $30 million...and what does eBay have to do with a VoIP company? There's a market for skype, it's just not that big, and eBay has nothing to do with it. So, when eBay pays a few billion for a company that its services can't really benefit from, it left many people quite puzzled. Skype, no matter how you look at it, is not worth billions. BTW, when you 'use' skype, are you paying for it? Are you making skype-to-telephone calls? I think cell phones have replaced traditional phones, skype is still a long way off. Until I can use skype from my cell, I don't intend on paying for it anytime soon.
  • Shadow > Yes, its $30M now, but the potential growth for a company like skype is enormous. It might not be related to eBays current line of services, but diversification is a great way of growing your business. I use skype for both skype>skype calls, FIXED LINE>skype and skype>FIXED LINE calls, I do pay for it, and it's a great service.
This discussion has been closed.