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What would it take to create and then sell a very successful website?

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40hz:
I think the key issue is what value is being offered by the website.



There are thousands of great ideas. But not all of them are viable as businesses. That's why we have charitable organizations and government. Those are the institutions we've created to provide needed services that don't make sense from a business perspective.

About once a week somebody suggests to me that I really "need" to start offering in-home tech support for people without much technical knowledge or money. "There's an incredible NEED for somebody to provide that." I'm told. (That much I can agree with.) But then they show how little they understand business by concluding: "You could make millions doing that."

Hmm...let me see...I should start a business to provide onsite hand-holding to 'high maintenance' clients that don't have a lot of money to spend...


See the problem? It's a nice idea - and it addresses a genuine need - but here's no business there.

-------------
BTW: Don't be afraid of being the nay-sayer. The age old business questions will always remain, no matter what market you try to enter: Who is going to buy your product. Does anybody want it? Does it address a significant need? How will people pay for it? How can you protect your product from competition? yadda-yadda

Old joke:

Q: How do you make a small fortune on the Internet in just 90 days?

A: Buy our book - and start with a large fortune. :P

Dormouse:
You need to stop thinking that this is about a website. It is about a service provided through a website. So it depends on what the service is, how popular it gets etc. And since entry costs for most such services are very low, you can expect a lot of competition fairly soon after starting if it is seen to be popular: so it is important to do it better than all the rest. Myspace et al reached the level of market 'dominance' by having the image and perception and the market share - and that made entry costs very high for potential competitors; not that Facebook was held back by that.

I don't think the current state of the economy is a major factor. If a site becomes fashionable it can do that just as easily in a recession. People may be less keen to rush out to invest in it but it would be a good few years before something built up enough head of steam to attract really big bucks.

The real problem (possibly) is the seedcorn money. If the idea is for something initially more expensive to provide than any advertising income that can be raised (eg Youtube server farms etc) then the amounts of money looking for website homes are much smaller than they were. Money will certainly be needed to fund staffing etc if the business starts to grow fast, but there will always be investors interested in fast growing businesses. Though they may want a higher % stake than in the boom. And these investors will not be interested in buying the business, just funding expansion for a hefty share.

It is also an area where change is rapid so things have constantly to be driven forward to avoid going stale and income dropping like a stone (though usually this happens after being bought out rather than before).

40hz:
Of course there's also that tiny little detail about how to prevent others from just taking your idea and running with it if it proves viable. Especially if they have deep pockets.

I do think the era of Internet Cinderella stories is pretty much over. You have too many well-funded and technically adroit companies actively monitoring just about everything that's going on for there to be much opportunity to slip below their radar.

YouTube, Yahoo, and all the other success stories made their mark before the 'big boys' caught on. The Big Boys won't make that mistake again. Look at online movie delivery. All it would take to sink Hulu is for the movie studios and TV networks to decide they would only allow streaming from their own sites and Hulu and the rest of them are doomed.

I think you'd need to come up with something totally unique and unintuitive before you stood a chance of creating a new multimillion dollar web niche.

superboyac:
Of course there's also that tiny little detail about how to prevent others from just taking your idea and running with it if it proves viable. Especially if they have deep pockets.

I do think the era of Internet Cinderella stories is pretty much over. You have too many well-funded and technically adroit companies actively monitoring just about everything that's going on for there to be much opportunity to slip below their radar.

YouTube, Yahoo, and all the other success stories made their mark before the 'big boys' caught on. The Big Boys won't make that mistake again. Look at online movie delivery. All it would take to sink Hulu is for the movie studios and TV networks to decide they would only allow streaming from their own sites and Hulu and the rest of them are doomed.

I think you'd need to come up with something totally unique and unintuitive before you stood a chance of creating a new multimillion dollar web niche.
-40hz (March 23, 2009, 01:10 PM)
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I lean towards this view as well.  But like i said, I'm just pessimistic like that.  But, I've been proven right too many times to believe differently.

gary1095:
Hi, I am superboyac's "friend" with the idea, and I appreciate all the feedback and advice you guys have provided. I'd like to clarify a few things so you guys can tailor your advice.

1. The website does provide an unique service. There are websites that provide a similar service, but in a very general, somewhat helpful way. The idea is to provide more specific information and advice, and thus be more helpful.

2. The service is very closely correlated with the job search/career-development market, and since that market is going to be booming for the next couple of years, it seems its a good time to do it.

3. I already have a virtual private server that is of no cost to me. It will not require nearly the bandwidth facebook or youtube requires since most of the site is text, and a few small images.

4. Competitors, naturally, are an issue in any scenario. However, the first mover advantage is huge, and would take a lot for another company to catch up, since the content is mostly user-submitted.

Let me know what you guys think.

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