When we were first getting started, I kept wondering about the value of advisors. Every company proudly displays their advisors somewhere in their about us (and so do we). But I couldn’t quite understand what, exactly, advisors brought to the table. Were they primarily intended as a signaling mechanism? For introductions? For domain experience? After a couple of years, I have a tentative answer.
One thing is for sure: the signaling aspect isn’t worth very much. Future investors will judge you on your metrics, opportunity and team, not who you’ve convinced to sign a piece a paper in exchange for some equity–regardless of their byline.
However, the introductions and domain experience that advisors bring to the table can be game-changing. And helpful introductions are really an outgrowth of genuine domain experience.
To give an example, Denis Grosz has been invaluable in helping us devise and execute an SEO strategy. It’s not that there isn’t a ton of SEO information already out there–there’s more than you could ever process. The issue is that it’s incredibly hard to evaluate what’s important to focus on and what’s not. And there’s also the fact that SEO is a zero-sum game. The people at the top of the SERPs have no interest in giving away their insights to their competitors. Having Denis as an advisor helps us surmount the inherent selection bias that exists whenever you get advice on topics like SEO: people who really know don’t share, and people who share don’t really know.
Recruiting advisors who have relevant domain experience and giving them a vested interest in your future is the best way to get long-term, valuable and actionable advice. Equity is an incredible way to align incentives.
We’re used to seeing long-tail requests over here, but last week we had a request that surprised even us:
I am looking for a professional makeup artist to transform me and my friends into the blue Na’vi people from Avatar for the morning of the bay to breakers race. I’m guessing this will involve some sort of airbrush.
Bay to Breakers is a hallowed San Francisco tradition–think early morning drinking, metallic spandex, tutus and nudity and you’ll get a pretty good idea. Our user wanted to go as a character from Avatar–so without the budget for stereoscopic technology, he did the next best thing and posted his request on Thumbtack. He got a few bids, and ended up going with Oui, Three Queens Productions. Evan, the artist behind Oui, Three Queens, specializes in fantasy bodyart and did not disappoint.
Update: A follow-up from the Na’vi:
I wasn’t quite sure who to turn to when I needed to be painted blue in my apartment at 6am, so I posted on Thumbtack and within hours, I had a professional, well priced bid in my inbox. Communicating with the service provider was a breeze since Thumbtack’s messaging system is set up to synch with my email– allowing me to be in touch with the service providers without giving away my personal email contact info. Because thumbtack verifies all of its service providers, I received zero spam or “sketchball” emails that I might receive on other classified sites. The makeup artists went above and beyond expectations, and a fantastic time was had by all.
So here is a speculation: The time may come when most tax lawyers are replaced by expert systems software, but human beings are still needed–and well paid–for such truly difficult occupations as gardening, house cleaning, and the thousands of other services that will receive an ever-growing share of our expenditure as mere consumer goods become steadily cheaper.
From Technology’s Revenge, an article about technological change and income inequality.
It has always been harder to find the right person than the right fact. Human experience and expertise are the most valuable resources on the Internet — if we could find them.
I would go further and say that human experience and expertise are the most valuable resources our planet has, full stop.
Last night we were fortunate enough to be invited to pitch at Open Angel Forum‘s first San Francisco event. It was awesome.
Jason and Tyler did an incredible job vetting 100+ applications — the quality of the start-ups they invited was top-notch and spanned everything from a high-tech algorithmic photo-tagging company to novel iPhone controlled toys.
The angels that got invited (they had to apply too!) were completely engaged, making for a thoughtful and spirited Q&A session. Best of all, it was clearly a group of people that simply loves start-ups, and they seemed to be there as much for us as for themselves. I was blown away.
Matt Galigan of SimpleGeo had a great comment on Chris Dixon’s post on the “geo stack” the other day:
I definitely think that the price of venue data (much like the prices of apps in general) is going to be a very quick race to the bottom. There are very few “big” players in this space: InfoUSA, Acxiom, Localeze, Navteq and a few more. Each of these big guys charge an unbelievable amount of money (at least when it comes to getting developers to use it).
[...]
The truth is, anyone that has a slightly more crowdsourced (including Google) approach to this will get inherently better data. This coupled with the fact that the data itself might be free in the next few years spells potential doom for the “big guys”.
This is definitely what we’ve encountered in the local services space as well. One problem is that these databases often don’t have key data for travel area and licensing information. But the biggest drawback is that these directory resellers have a lot of data but no genuine connection to the business or provider behind the content. And it’s this relationship that is so valuable for building a vibrant ecosystem. That’s why Thumbtack is focused on crowdsourcing our information directly from those businesses — it gives us better data and a relationship with the owner.
IAC’s ServiceMagic reported today that it saw a 51 percent boost in 4Q revenue, growing from $25.3 million in 2008 to $38.2 million in 2009. The boost was accompanied by a 21 percent growth in the number of home and trade providers that pay for its leads; and a 46 percent gain in service requests.
[...]
Profits, however, were low at $1.2 million. They were held down by increased marketing efforts, including an expanded sales force and a major advertising campaign.
Consumers are clearly searching for and sourcing local services online more and more – here‘s one report pegging local searches as 1/4 of overall search volume — and ServiceMagic has done a great job capturing the home improvement slice of these leads. But who is going to aggregate the long-tail of services remains to be seen. This morning we got one more reminder as to just how big this market is when we generated a lead for this Farrier in Magnolia, Texas.
“I’m pretty certain that 70-80% of CL’s traffic is in the Personals section. And, I’m pretty certain they’re not all heading to the ”platonic” side of personals ”
To which I responded:
I think your comment about craigslist’s traffic being dominated by personals really highlights what they are best at: connecting people. But it’s worth noting that a lot of the categories they support are more specifically about completing transactions, not just connecting people. And I think that it’s this gulf that has created so much opportunity for new start-ups.
And then expanded:
Maybe ‘completing transactions’ was the wrong phrase to use as I see exchanging money to be just one part of what’s missing. Scheduling support is another. As is vetting the quality and trustworthiness of the service provider you’re hiring. And it’s not just an issue for consumers: a common complaint we hear from our service providers about Craigslist is that they are forced to compete solely on price due to the lack of a profile system for them to accrue and project reputation.
Most of the benefits that Craigslist has over traditional, newspaper classifieds come from the platform that it is built on rather than any improvements they’ve made to classified ads as a product–negligible costs of production & publication, ease of search, and genuine anonymity are all properties of the internet as a whole. That said, improving upon the product is just part of the challenge facing start-ups trying to carve out a niche for themselves. That Craigslist provides so much value is ultimately a testament to the power of network effects–and creating a vibrant community is the other enabling factor for sparking a truly viable alternative.
Trying to carve out a niche from Craigslist is no small feat.
Thumbtack is a community marketplace for you to list, discover and book local services. More than 200,000 small businesses and independent professionals have listed their skills on Thumbtack.
Need to book a local service? Tell us what you need done, and we'll e-mail you 3-5 quotes on your job within 24 hours.
We have service professionals in all 50 states in categories from home improvement to health & beauty to tutoring & lessons and much more! Whether you need a House Cleaner in Raleigh or an Ice Cream Truck in San Francisco, Thumbtack is the place to find & book local services.
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