Ning is a new’ish company with some recently released technology that will skyrocket this company into the stratosphere. 

It’s the first company that I’m aware of that has created an easy to use, drag and drop, easy configuration site for users to create their own Social Networking site.  Literally within minutes you can have your own Social networking site with video & picture functionality, forums and a host of other features that allow the non-tech savvy out there to potentially get in on the Social networking action.

Business Model:
Ning’s business model is simple:
1)  They add ‘Adsense’ to the right hand column of every Social networking site so as people promote their new networking site, it should, in principle create a multiple effect Ning’s ad revenue
2)  People who want to get the benefit of the Adsense on their own site can pay a monthly fee, currently standing at $19.95.  They can obviously stratify that later so the more popular sites have a rev share and the less popular pay the fee or take Ning’s ads and just get on with running their site

Some Core Functionality:

• Social Networking:  Invite, meet new people, privacy settings, address book importing
• Full Customization of Theme or take existing template and configure.  Add your own logos, photos and branding
• Photo sharing, video sharing, forums
• …and the list goes on. Not bad for FREE! 

Likes:
There are a number of reasons why Ning will sing from an investment perspective:

The user interface is VERY easy to use and intuitive, I set up a social networking site in under five minutes and was…with a shy smile…relatively happy with how my very own social networking site looked (Check out the results:  http://amateurs.ning.com/)

With a couple of hours – it would be possible to make the site really work as some of the existing sites within Ning show.

As people promote their site, they promote Ning, this gives them the magic fairy dust needed for companies like this to go from 2, 200, 200K in months.  Their adsense revenue should be pretty obscene soon. 

I am starting to wonder if people are starting to mentally phase out adsense and these ads become a almost invisible to the human eye. What do you think?

As members of Ning can seach the different Social Networks there’s the potential to pick up stray but interested members…not bad!

Dislikes:
OK, so I used Ning and built my site based on a crazy little idea I had a while ago.  Thanks guys…I have finally seen my idea live. 

I know Ning has done one side of the hard work for me…the tech side, but I still have alot of the hard work ahead.  How to get people onboard, especially the first few users.  With these kinds of sites, you need a few active members so that the shy and reticent don’t worry about joining too.  The more people onboard the more valuable the system, so you really do need those first few.

That works if the Social networking site is in an area that already relates to a space with which I’m involved…so for me, Startups.  But what if I’ve set up a site because of an idea I’ve had but where I have few contacts?  That is a big stumbling block for this to go viral with all social networking sites created.

I would imagine that 10% of the users sites will hit the volume big time, 20% will do pretty well and the rest will perhaps exist but in name only.  Just a guess! But if the 80/20 rule works here…the majority of adsense revenue will come from the large volumed 20% and those will be the ones that convert to the $19.95 monthly fee. They would be mad not too and where does the revenue come from then?

Also, if I do create a site that really starts to rock and roll…iId like to port it to my own server and do it for myself.  Arguably if I did that then I couldn’t take advantange of Ning’s new functionality releases but it would still be mine.  Ning does not seem to have that on their roadmap.  If they don’t someone will come along who will offer that.

It would be good if Ning could figure out a business model to allow that to happen and keep some of the revenue. Perhaps a premium service would be to host the site under a separate URL but share the revenue or charge a higher monthly fee.

Last point – how long until the Social networking site market is completely saturated?  When the point arrives (if it hasn’t already) then this functionality becomes a glorified Yahoo Group type service.  I guess that still gives them the potential to be acquired by Yahoo or Google sometime ahead so another reason for a big virtual investment.

My Virtual Investment:
With my virtual $1M, I would stop inviting all my friends to http://amateurs.ning.com/ to invest $500K in Ning.

http://www.ning.com/

Andrew
Founder
http://www.AdvisorGarage.com

Just after the last post ‘Geni: A $500K Virtual Investment’, Geni were kind enough to respond with the following:

“Geni JoAnne Feb 26th, 2007 at 4:46 pm Edit

Hi Andrew. Excellent blog. We are considering adding premium services to our site in the future–the basic service will remain free.”

JoAnne – Thank you for letting us know. It would be great to understand what Premium services Geni will be offering – but I’m sure they will be as value add and innovative as the core site itself.

Have your say here: http://www.andrewive.com/mdsg-forum/

Great job Geni!

Andrew
Founder
http://www.AdvisorGarage.com

Geni is a very interesting online service that leverages an easy to use flash interface and viral tools to create family trees.  One interesting concept to prove or disprove is that the whole world is related in one way or another. Could Geni be the solution to world peace?   

Business Model:
I have been unable to determine how Geni makes money but there are a number of obvious ways Geni can see the green as they quickly hit critical mass i.e. adsense, monthly subscriptions, follow on ‘pay for’ services and there is such a strong potential growth curve that this make sense as a ‘virtual’ investment:

Some Core Functionality:

• An easy to use interface asks you to add your name and email address.  You can update your profile now or later.
• You add your parent’s names, aunts, uncles, cousins and their email addresses and Geni begins to create a private access family tree. i.e. only visible to people invited to input into the family tree.
• Geni is ‘viral’ so any people you add to your family tree with an email will be able, in turn, to see and add to your family tree.

Likes:
There are a number of reasons why I think Geni will be going ganbusters in six months or less:

The user interface is VERY easy to use and intuitive, I find it hard to imagine that any user will not be able to instantly understand how to use ‘Geni’

Its one thing to be asked to join a ‘networking’ site via a friend, work colleague or distant contact – its quite another to be asked to ‘join’ by Auntie Flow or Cousin Rupert. There is also something immediately to be gained by participating…you get to find out about YOU! A subject at the center of everyone’s universe.  Can anyone really turn up their nose at such a site?  I think not!

Like most sites that go from zero to 180 miles per hour in 6 seconds or less, members only gain value if they bring others to the system.  Hence the reason why Match grew well but slowly (i.e. you could use the system without needing to ‘Add’ to the system) versus LinkedIn where its necessary to bring people onboard to gain value. Geni is the later…in a significant way!

As each person within the family tree has a profile, its also a good way to keep up with those relatives that you don’t get to see too often…now if it could only remind me to send a birthday card, life would be even better.

Dislikes:
What’s the revenue model? Yes, Geni will grow in leaps and bounds but how will they make cash?  Will we start seeing annoying addsense ads beside Grandpa Joe’s photos advertising denture cream?  It isn’t obvious at this point. The setup and tools within Geni will ensure the site will grow…no question!  But like many 2.0 companies – when and how they get to revenue is a question.  Without understanding the roadmap to revenue, I’d make a big bet on Geni based on how many users I think they will have by 2008.  There are always ways to monetize significant membership level.  So a big bet but not a huge bet until the revenue crystalball becomes less opaque.

A little nitpick – what about those people who do not email?  I know…I know…but my grandparent’s aren’t online.  So I potentially ‘lose’ that information unless I get on the phone and talk them through it.  May be worth it though…

My Virtual Investment:
With my virtual $1M, I would put the phone down on my Mother to invest $500K in Geni.

http://www.geni.com/tree

Andrew
Founder
http://www.AdvisorGarage.com