Business Development 2.0

  Originally uploaded by Andrew & Nicole.

It used to be that web companies needed to hire one or more smart networkers and set them loose on all the other web companies in search of deals that bring traffic, users, additional functionality, revenue, and a host of other good things. Most of our companies have business development people and they are some of the most talented people in our companies.

But we have witnessed some interesting things happening in and around open apis, rss, search, crawling, embed code, widgets and mashups that suggests there’s a new way to do business development. Here are but a few of the interesting things we have noticed:

  • YouTube makes it flash video player available via embed code on MySpace and their traffic takes off.
  • TripAdvisor search engine optimizes its service and becomes one of the most popular travel services.
  • Technorati hits delicious’ api for its tags and builds the web’s most succesful tag search service.
  • Indeed crawls the Internet for jobs and builds a popular job service overnight.
  • Kayak crawls the Internet for flights, hotes, and cars, and builds a popular travel service overnight.
  • Qoop takes Flickr’s API and builds a Flickr printing service without ever engaging with Flickr’s team.
  • Netvibes takes a few RSS feeds and builds a start page that looks as complete as MyYahoo overnight.

You get the picture. These days it’s often better to just take what’s already freely available on the Internet to integrate with other web services. As Caternina explains in this post, the Flickr team didn’t really have enough time to focus on the multitude of companies wanting to offer a printing service. Qoop just built one and when Flickr looked at it, it was an easy decision to offer it to their customers.

We have noticed another thing happening. When you do get a business development deal with a leading web service, the implementation is everything and it often sucks. Witness the job search space. Indeed has a deal with the NY Times. SimplyHired has a deal with MySpace. I’ve looked at the media metrix numbers and neither jobs service (NY Times and MySpace) is delivering any real usage (0.1% of myspace users visit which is SimplyHired’s myspace service). Think of the time and energy that went into these deals. And to get 0.1% of the users to take up a service is so deflating. I think it might have been better to do some creative advertising deal that could have gotten done much quicker and might have delivered better results.

The bottom line is that web 2.0 offers a new way to get integration with leading web services and you don’t have to waste your time and the time of other busy people trying to craft deals that will probably work out badly anyway. As Caterina says, "Much, much better this way!"

#VC & Technology