The Little Secret of Web Startups

This post is written by Marcelo Calbucci, the founder and CTO of Sampa, a personal homepage creator that will be shutting down this month. He’s writing a series of posts about the lessons learned from the venture.

“In the middle of 2008 we decide to do a qualitative analysis of our user base. People of all kinds were creating sites on Sampa.

There wasn’t an automated way to know if it was a baby site, a family site, a small business, a technology blog, etc. We looked at more than 300 sites, randomly selected and created a spreadsheet with the category, the demographic of the author (if we could figure out) and we plugged that into our own analytic system to split our averages and totals for each site category. The results sucked!

Just 20% of our users were on the target audience. That meant 80% were not building any kind of family or baby site. Ok, maybe we can live with that. But it turned out that more than 25% were by pre-teens.

There are two problems with that: First, It?s actually illegal in the US and most countries to allow a younger than 13-year-old to sign up to your service without parental consent. Second, pre-teens are not a great audience to build an advertising-based business model.

However the data showed an even worse picture. Pre-teens were a quick burning flame. They would come, upload lots of pictures, write lots of blog posts, bling their site, invite 20+ friends and they would be completely gone in a month.

That behavior skewed our data enough that once we looked at our growth, viral rates, and everything else, our business didn’t look so great.

We proactively removed pre-teens websites. They weren’t easy to find, but every time we found one, we would remove the website and notify the owner she was 12-years-old. They would be mad at us and tell that Jamie, Emily and Sally also have a website on Sampa, and we would say thank you and delete all their friends websites too.

We would also proactively delete porn websites. There is nothing wrong with porn. It’s not illegal or immoral in my view, but it didn’t go well with our family-oriented business proposition. Also, most UGC porn sites are infringing in someone else copyright and we just didn’t want to deal with DMCA or lawyers.

We also found criminal websites, from people trying to steal credit-card and passwords to the ugly side of online pedophilia. We had the FBI come over twice to collect evidence.

Pretty much every Social Network-builder, website builder or content sharing site deals with the same issues we dealt with.

A good number of entrepreneurs (and most investors) will be oblivious to those facts and just think that everything is going great and the growth is sustainable and proof they are creating great value and soon will be able to turn a huge profit or to sell for hundreds of millions of dollars, until someone takes the time to figure out what people are using their service for and finds out it?s really not what they thought it was.

Photo by Leeny.

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