Just Another Yuppie Drug Deal?
We're in Palo Alto, it's 7:30 am and overcast with low costal fog and a multitude of other early morning atmospherics. I'm wearing my best sandals and enjoying a Kool Filter King in the open air with some measure of hypnagogic hangover bliss. I adjust my reflector wraparounds, and we silently continue to search for the hotel room. No, this isn't a yuppie drug deal, this is the Churchill Club's Breakfast with Craig Newmark, the 'craig' of craiglist.org, that 10 year old overnight internet success story ...
... But it's Early. Damn Early ...
... More black coffee, STAT! A tiny question incessantly chirps in the recesses of my semi-conscious morning mind ... "Does menthol qualify as a food group?" Then another tiny question percolates to the surface ... "What if the caffeine has no significant effect?" Fear and Loathing in Palo Alto? Hey, nobody said this was going to be 'pretty' ... but at least we can maintain our professionalism(?) Well, ok, maybe not ...
3 Questions for Craig Newmark
Mark Calvey from the San Francisco Business Times moderated the event and voiced questions that were quite similar to our prior submissions, so let's just use those for starters since they're handy:
Question 1: Regarding the eBay 2004 transaction, reportedly for a 25% stake in craigslist, what went right and what went wrong? How has craigslist's mission been affected, if at all?
Answer: Turns out that ebay bought the 25% stake through a former craigslist employee. What went right was that ebay was considerate enough to consult with Craig before purchasing the shares. Not sure anything actually went wrong, but hey, it's still early ain't it? Craig recursively states that the biggest effect of the ebay purchase on craigslist has been that he must repeatedly answer questions on what the biggest effect of the ebay purchase on craigslist has been. Yeah, this guy was an IBM Java programmer alright ...
Question 2: With craigslist coverage in 45 cities, 1 billion page views per month & 5 million unique visitors (2004), please describe plans for the next phase of growth. How will eBay be involved?
Answer: craigslist grows city by city, based on community requests and critical mass. What a remarkably sensible way to manage growth! Perhaps common sense is a 'disruptive technology' ... It seems like ebay would like to learn more about the dynamics of informal online "flea markets" (craig's own term) like craigslist where more spontaneous social networking just happens. ebay is also a very sensible company.
Question 3: What types of revenue does craigslist generate (adverts/promotions, listing fees, search fees, etc.) and what are the revenue growth projections/timeframes for these categories? Or, put more tersely, "How do you make money?"
Answer: The craiglist model is simple, instead of using MBA-fabricated business models, they just ask the craigslist community "what is moral to charge for?" and then take heed of the responses. By using this technique, it seems that craiglist generates tens of millions USD in revenues from job listing fees and real estate broker fees, in multiple U.S. cities. Difficult to verify this data unless you have access to craigsbooks, but it's hard for any service to stay online for a decade without SOME sort of revenue generating business model instead of just another nasty-ass sock puppet ad campaign ... or the like.
Moral Compass: IPO? Just Say No!
The term "moral compass" was used repeatedly, so much so that I began to feel vaguely uncomfortable for no apparent reason ... Ah well, must be the menthol & caffeine combo breakfast ... By moral compass, I believe Craig means integrity and a strong sense of moral values that's part of the company's DNA. For example, when asked about going IPO, Craig just says no ... why ruin a good thing i.e. lifestyle with the machinations of a public corporation? Going IPO is not central to the craigslist mission. Nor are banner ads from Microsoft, for that matter. Instead, Craig is simply trying to instill a sense of community and neighborhood via the Internet.
Nerd Values: Customer Service Representative & Founder
On Craig's business card, his title is "customer service representative & founder." Craig's basic core values are nerd values: "make enough money to live comfortably, then make a difference" ... to affect social change.
To that end, he has created craigslist foundation: a set of resources for other non-profits & a platform for social philantropy, and I'm pretty sure it's open source :-) "... We produce events and online resources to help grassroots organizations get off the ground and contribute real value to our community ..."
Working the "George Costanza" Thing
During his remarks, Craig compared his appeal to that of Larry David's character, "George Costanza" on the U.S. TV sitcom Seinfeld. Craig says the "net is about including people" yet also mentions the importance of the "Circle of Trust" within the craigslist community. To understand this better, you must visit 24hoursofcraigslist.com and make sure you view some trailers.
The Biggest Mistake
Oscar Wilde said something about, "If you want to tell people the truth make them laugh otherwise they'll kill you." So right now, the art Craig is most interested in is comedy. "... It seems to be the only way to tell the truth about politics, that's why the most trusted name in news is John Stewart ..." And Craig's self-described Biggest Mistake was, "I didn't trust my instincts."
However, these days it seems like Craig's instincts are just fine ... and he trusts them implicitly.
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