Can This Startup Turn Politics into Profits?

Barack Obama and John McCain are about to accept the formal nominations at their respective conventions. But they didn't do it on their own -- they had the help of a startup called

The site was founded as a way for people to find local events and request that their favorite bands or comedians come to town. Seven million users are registered on the site, detailing where they live and their interests, signing up for e-mail newsletters to find local events among the 8 million posted on the site. People can also demand that their favorite performers come to town -- and about 50,000 bands use Eventful to decide where to tour.

But it's not just about bands and fans. In early 2007, John McCain started using the site to connect with his supporters. Soon thereafter, all the other Presidential frontrunners jumped on the site. The site allows the candidates to figure out what small towns they should add to their itinerary, and to alert their supporters if they're going to be in their area, if not their town.

And when a political candidate listens to a request, people feel such a sense of ownership, they really do show up -- and most of the time they bring a number of others with them.

Eventful doesn't charge the candidates, and it doesn't post ads on the e-mail reminders it sends out about political gatherings, so its political outreach doesn't actually earn it much. But over 60 percent of visitors who come to the site for information about candidates also register for other services. So the campaign ends up lifting its revenue streams.

The company makes most of its profits from ads on targeted e-mails: Eventful users provide a lot of information about themselves -- in addition to their zip code, gender, age, the types of events they're interested in. This allows the site to narrowly focus ads, and the more focused the ads, the more Eventful can charge advertisers, and the more compelling it is to users.

The company isn't profitable yet, but with its boost from politically-minded users, and its focused targeting, it's well on its way.

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