Archive for March, 2006
Buenos Aires Real State Boom
A couple of weeks ago there was an interesting article in El Pais
about the booming property market in Buenos Aires. Now that house
prices have slowed down in Europe and the US, it might make sense to
look at other options abroad that can provide higher returns and a
little adventure. Buying a house in Argentina is incredibly cheap and
simple and that is why the country is flooded with foreigners buying
properties (including myself).
El PaisHace cuatro años, cuando la devaluación del peso
abarató los activos de Argentina, representaban sólo un 3%, según
Rodrigo Fernández Prieto, director comercial de la empresa. “Antes de
la crisis, las compras de extranjeros eran insignificantes y ahora en
Puerto Madero llegan al 30%, incluyendo argentinos en el exterior, y la
incidencia también es alta en otros barrios caros como Recoleta, Barrio
Norte y Palermo”
Dypsa,
vendió más de la mitad de los apartamentos de las dos torres que tiene
en el nuevo Puerto Madero -donde se encuentra el metro cuadrado más
valioso de Buenos Aires- a residentes en el exterior, entre ellos
españoles -por eso abrió oficina en Madrid-, alemanes, británicos,
norteamericanos, chinos y japoneses.
El Pais: Compre un piso en Buenos Aires
BBC: Argentine slump spells property boom
(This BBC article was written by a friend who came to visit me in 2003)
ADOOS Argentina: Real Estate listings (Find a house to buy here).
Here are a few pictures of Buenos Aires. More pictures at Google Images
Adsense Free Fall
Hey Mr. Google, what’s up with Adsense!! CPMs have gone free fall
over the past few months. What is happening? Ad matching issues? Are
users now blinded to the Adsense format?
Luckily we no longer depend on Adsense anymore. In February we rolled out new premium ads at 10 Euros per ad. Premium ads appear on the classified list highlighted in bold and with a thumbnail.
Adsense
has been great at replacing the angel investor in the initial phases of
the project but, we are now in the process of breaking all dependency
from Google both in terms of revenue generation and traffic generation.
Here
is a chart of the Adsense CPM evolution over the last 6 months.
Unfortunately we can’t show you the actual values for strategic and
contractual reasons.
Adsense CPM Trend (Oct 05 to Mar 06)
Startup Tips: Get Ready To Be Poor
Today I’ve read an interesting post at Technologica about launching a startup. Scott Lake has been involved in three startups, here is what he thinks:
Get ready to be poor!
The one thing that holds most people back from starting a company
is that they don’t want to spend their own money to do it. The days of
free money are long gone so for the most part you have to spend some
money to get things going. The best way to be able to deal with this
fact is to get ready to be poor. By this I mean get ready to have the
mindset of not spending money. Also if you are serious about starting
something, start saving now because it generally takes 6 months to a
year of unpaid work before you can even show your product to a VC or
angel. Once you are in the mindset of not spending money you soon
realize you don’t actually need that much money to live or start a
company. If you can make that mental leap, you’ll realize that you can
save on everything and after a while it becomes fun stretch every
dollar.
Paul Graham is another guy who writes excellent stuff about launching startups. Here are some more tips:
Three things to succeed:
You need three things to create a successful startup: to start with
good people, to make something customers actually want, and to spend as
little money as possible. Most startups that fail do it because they
fail at one of these. A startup that does all three will probably
succeed.
Everyone works for stock. Rent your servers.
You don’t pay salaries at these levels of funding. Everyone works
for stock. The main costs end up being hardware and hosting (and
possibly development if you outsource some stuff to eLance or another
service). I took different approaches to hardware with ONElist and
Bloglines. WIth ONElist, I rented machines from Digital Nation. With
Bloglines, I purchased the machines and hosted them at a local co-lo.
The advantages of renting machines are that you have a lower up front
cost and you don’t need as much sysadmin experience, because they will
handle a bunch of the work for you. The advantages of purchasing are
that it’s cheaper in the long term and you’re not limited in your
hardware selection. Now that I have experience with both approaches, in
general I’d probably go with renting. Renting saves a lot of effort
(configuring and racking machines is work), and costs less in the
beginning. This lets you get your start-up out the door more quickly
and cheaply. And that’s a good thing.
If you like these tips, you are going to love his essays:
-> Ideas for Startups
-> How to Fund a Startup
-> The Venture Capital Squeeze
-> Hiring is Obsolete
-> A Unified Theory of VC Suckage
McKinsey Quarterly – Classified Ads
There is an article about the classifieds industry in the last McKinsey Quarterly edition. The article can be viewed here but you will need to register in order to view the full text.
Here are a couple of interesting quotes:
Newspapers are having difficulty raising advertising rates to make up for sagging volume, since online competitors offer advertisers an inexpensive (and inexhaustible) supply of ad space in local and national markets. In some cities, newspapers find that they must offer small advertisers general classified ads free of charge.
Strong competition characterizes real-estate advertising too, though the housing boom of the past five years has softened the impact.
Lines of employment ads in newspapers now stand at about half the level we would have expected given prior trends (View Exhibit). US newspapers earned $5.8 billion from employment classifieds in 1996 but only $4.8 billion in 2004, including $300 million from the newspapers’ own online operations. Most of the loss can be traced to price destruction wreaked by the newspapers’ online competitors, which earned some $400 million.
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I agree with the author that price destruction
has been dramatic in the classifieds industry, but this is not
necessarily a bad thing. Web users now have access to a free ad
marketplace and they can post as many ads as they like, consequently
the liquidity of the marketplace significantly improves.
The
reality is that free online classified websites are putting downward
pressure on the price of newspaper classifieds in a similar way that
Skype brings down long distance calling prices. If newspapers want to
compete, they will have to will drop prices and change pricing schemes,
like performance-based pricing and auction-based sales similar to
AdWords.
Web 2.0 Companies
A month ago someone collected a giant heap of web 2.0 logos, and put
together a collage of US startups. Now we have a Spanish version from Loogic.
I
recognise the logo of 28 US companies and 15 Spanish. Most of these
have AJAX interfaces but, do they have a business model? Are we
approaching web 2.0 bubble?
Here are my favourites:
Favorite logo: Blogger
Favourite company: Wikipedia (actually a foundation)
Favourite service: Gmail
WEB 2.0 HISPANIC STARTUPS:
WEB 2.0 US STARTUPS:
Building Up Critical Mass
Launching a classifieds website is all about building up critical
mass until you reach a tipping point where it starts to become
economically viable to invest in marketing campaigns. Essentially
creating an information marketplace that is viable to serve ads against
that traffic.
It sounds easy but it’s extremely hard to
reach that tipping point, it can take from 6 months to 1 year of hard
work. Unless of course you accelerate timings by burning money on
pre-tipping point marketing campaigns.
Habitamos.com critical tipping point
The chart shows the critical point for Habitamos.com (May 05). It
also shows the growth of the Italian, Mexican, Argentinean and
Brazilian sites which are approaching their respective tipping point.
Our internal studies show that the tipping point is approximately around 10,000 active ads and 100,000 unique visitors. No big secret given away, its all common sense!
SEM/SEO Salaries in the US
Reading OjoBuscador today I find an interesting article about salaries in the search marketing industry in the US.
These
figures make me think that I sold some of my SEO/SEM consulting
services too cheap a couple of years ago. Then again.. this side of the
Atlantic things are always different.
Based on information gleaned from the few firms that publish salary
ranges in their job openings, several compensation trends appear. An
entry-level SEM position tends to range from $30,000 to $45,000, for
example. I did come across one firm, though, that sought an SEM
marketing analyst for $10 an hour. You had to answer the phones, too.
If you possess three- to five-years experience in the
industry, salaries range from $50,000 to $75,000. This includes the
majority of the salary information published for online marketing
account managers. More tenured, expert-level paid and organic search
optimization specialists can garner $75,000 to $90,000 a year.
Senior management salaries tend to range from $70,000
to $120,000, while SEM directors can earn $95,000 to $150, 000. Of the
few VP-level positions that post salary ranges, the most common
offering is from $100,000 to $200,000 a year.
Google´s Revenue per Search 12 cents
You may not know it, but every time you search on Google, the company makes 12 cents in revenue.
That may not sound like much but it all adds up when
you realise that Americans alone did more than 2.7 billion searches via
Google in January 2006, according to figures gathered by
Nielsen/NetRatings.
Red Herring: The Wi-Fi Revolution
5This week Red Herring talks about Free Wi Fi and FON
If
anything keeps executives of old-line phone companies up at night, it’s
probably telecommunications upstarts like FON. The Google-backed
company and others like it are looking to allow people to communicate
more cheaply using the Internet.
Wireless mesh
technology, which links individual access points and effectively turns
them into a larger network, could represent the future of Internet
broadband.
Red Herring: The Wi-Fi Revolution (subscription)
