Looking for the Web's Next Star
I had the unusual opportunity to emcee Silicon Valley's first Technology Policy Summit last week in San Jose, an awesome collection of policymakers, investors, CEOs, nonprofit reps and academics. But one of the most fascinating panels included the co-founders of three of the web's most exciting start-ups. And I had the chance to interview them exclusively about the potential of their sites, and the prospects for a bigtime payday.
It's true that CNBC tends to focus only on publicly traded companies. To wit, investors may want to keep an eye on these three companies to see who, if anyone, snaps them up, giving that big company a key leg-up in some of the hottest growth opportunities online.
And venture capitalists are, flocking to the scene, which may be a sign that the trend is peaking. Nonetheless, VCs have poured a staggering $500 million into 79 internet startups in 2006, double the pace from a year earlier.
Why focus on these companies now? Remember that mySpacewent from nothing to a $600 million payday in under a year when
it was gobbled up by News Corp . YouTube did much the same thing in 18 months with a nearly $1.6 billion dollar buy-out by Google. And rumors are the up-and-coming Facebook has already turned down a $1 billion buy-out offer from Yahoo.
So now, as the social networking craze continues to rage (look no further than Cisco Systems and its curious stamp of approval of the trend by buying Tribe.com, which follows its recent acquisition of Five Across, a social networking design firm), three startups may be the next card-carrying members of the Web Winners' Club!
They are digg.com (as in digging a hole) whose CEO Jay Adelson (the co-founder of Equinix which carries a $2.39 billion marketcap on Nasdaq) tells me, "Our front page of our newspaper looks different every time you see it." Digg, started by a former colleague of mine at TechTV Kevin Rose (but it's not like we ever hung out together -- which is really too bad, for me!) is a kind of hybrid site of social networking meets the news business with community members ranking, and then determining, which news stories the rest of the community gets to read.
"Right now we are about 15 million unique visitors a month which is a strong number for the internet," says Adelson. "As the user becomes more accepting, digg becomes an even more popular site for them."
There's LinkedIn.com from pioneer Reid Hoffman who made his initial fortune as an early