Odds of Finding Sponsor/Investor for New Website


2

I recently launched a website for developers (blackbeltcoder.com ). It's a free site that will employ an advertising business model.

I'm very pleased with the rate of growth in the just over three months that the site has been live (although it's never fast enough). In fact, visits to the site doubled yesterday and am doing about the same today.

I love building something that is small enough that I have complete control, but I've depleted my resources. My biggest fear now is that I'll need to focus on consulting to earn a living and will lose some of the momentum I've achieved with the site.

My question is: What are the chances that I'd be able to find some sort of investment or sponsorship to where I could continue to spend my time building the site? And how might I be able to maximize those odds. I think the site will succeed either way, but it could take much longer and be much harder without some infusion of cash.

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asked Mar 24 '11 at 11:56
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Jonathan Wood
120 points
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4 Answers


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Unless you can get seed money from the 3 F's (Family, Friends, Fools) Chances are non-existent, unless you are able to prove user traction and retention. No one in his right mind will open his wallet for an idea. They want to see the idea take life and how the market reacts to it - and they want this proof to be financed by someone other than them.

Your challenge is double. You want to attract both investors AND advertisers. The good news is that the solution to both cases is with good user traction. Advertisers will no bother with your site unless it has good traffic. Sponsors/Investors will not bother with it unless you have a proven track record of good user traction and retention, and even then, most will walk away as you mouth the words: "My revenue comes from ads".

IF you believe in your idea, develop it, publish it any way you can and get good user traction. Without it, you'll be invisible to investors/advertisers. Also, it might be prudent to try and explore the possibility of revenue that doesn't come from ads.

Good luck.

answered Mar 24 '11 at 12:18
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Ron M.
4,224 points
  • Thanks, but I'm a little puzzled by your reply. Having launched the site over three months ago is more than just an idea. And, in fact, I already have advertisers. It's just that income from those ads are barely a trickle because I don't yet have enough traffic. But I can demonstrate very impressive growth in the short time the site has been live. Clearly, my approach to growing the site is right on track. – Jonathan Wood 8 years ago

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Why dilute now? IMO, it's just time to get your hustle on. Take the consulting jobs that keep the bills paid, and focus on building your site and its momentum. Set realistic and rigid milestone goals and MAKE IT HAPPEN. Really---you should be keeping all of the equity you can right now!

Only if that fails, which it shouldn't....I'd suggest going the friends/family route if possible. Would be even better if you could get someone with a complementary skill set to yours.

Caution: Make sure you know exactly how much money you need to get your project to the next milestone, and be very rigid about what that next milestone looks like. I've seen a lot of people in your situation take small investment after small investment just to "keep it going".

answered Mar 25 '11 at 00:58
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Andy Swan
1,656 points
  • I can certainly see the advantages of making it work without help and I've already started planning for that. But as I stated before, it's going to be much harder and take much longer if I'm spending my time on contract work. (BTW, I really think the site helps Microsoft as much as anyone and have put a lot of effort into trying to get sponsorship from them. My information suggests they may have written a check at one time but not in the current economic climate.) – Jonathan Wood 8 years ago

1

It's a nice site. At first glance, it's very like many Microsoft MVPs' blogs, and those are generally characterised as modest direct income earners, that primarily pay their way by consulting engagements generated.

But I think your aspirations are to be more of a magazine-style community site - asking for contributions from others. That's a steep hill to climb: there are plenty of high reputation sites and journals out there, and early growth doesn't guarantee you'll push past your rivals.

Whatever the site is, and wherever it's headed, you already know the two salient facts, that both point the same way:

First, it's pretty easy to obtain relevant ads from existing networks to place on your site, and you need high visitor volumes for that to add up to significant income.

Second, until you've got high visitor volumes, you'll find it hard to negotiate directly with advertisers or interest prospective investors.

High growth is exciting, and it is already multiplying the value of your site. But for advertisers and investors alike, it's all about volume achieved and sustained.

answered Mar 25 '11 at 06:13
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Jeremy Parsons
5,197 points
  • Thanks for the feedback. Although I am a Microsoft MVP, I don't quite share your view that this site is along the lines of an MVP blogs. This is not a good forum to go into details about what I think makes it unique, but I am, in fact, already earning money *directly* from advertisers. My 1-month Alexa rank went from NA to under 300K in only 3 months. So, yes, it isn't easy but I may be a bit more optimistic than you. Thanks again. – Jonathan Wood 8 years ago

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Fantastic vision for your site. I found it easy to navigate and I knew what you were up to quickly! That is always nice.

I wanted to add to the wonderful answers above -- boy I am using lots of up arrows today -- with a thought for you to consider.

The customer is the person who pays the bills. If the site revenue model is to generate revenue through advertisers then advertisers are the customer. They are the ones that pay the bill. So what are the advertisers buying? They are not buying your website -- or it's content. They are buying the profile of your sites visitors and users multiplied by the likelihood they are to click the advertising and become customers of theirs.

Your content? That is the bait. That is how you produce the product. The product is the user group.

So who IS your user group? What is their profile? How do you know? Can you prove it?
I am sure you can.

Now -- who wants that product? What is the UVP of your product? What is your sales process to go out and get the advertising/sponsorships that will make the site a viable venture to make your day job.

Just a slightly different way to think about the growth cycle.

answered Mar 25 '11 at 08:29
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Joseph Barisonzi
12,141 points
  • Thanks for the comments. About the only demographics I have is that provided by Alexa. One well-know person at Microsoft was nice enough to spend an hour on the phone with me. As he put it, I'm selling "eyes" to the advertisers. I think success will be brought about through a combination of content and SEO. I've thought a lot how my content will compete. Of course, I can go into much greater detail but there's hardly enough room here. :-) – Jonathan Wood 8 years ago

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