SXSW is pretty incredible. At its most idealized, it’s a grass-roots, “let’s do something we love with the community we love”-type festival that has grown up for all the right reasons. You (or I) can argue that, but that’s not my point here…
Over the years, it’s expanded from just music to include film and interactive. Gone are the halcyon days where “interactive” meant “I have a cool, probably obscure-looking web site with odd navigation” or “we secured common.com and $50MM in venture capital.” Today, “interactive” is a juicy combination of start-ups, established companies, and big names wanted to keep themselves in the minds (and wallets) of everyone else.
Of course, one common thread between the dot-com boom days and today: seeing business as a popularity contest. One of the things that exacerbates this is the “entreporn” (as coined by Amy Hoy) of our day: of course Facebook has more users than anyone, and Twitter exploded at SXSW (and has subsequently received [estimated] hundreds of millions in funding). There are tons of smaller examples as well.
Walking around SXSW Interactive, you hear buzz about page views and members connecting “socially”. “How many ‘likes’ can you get?” “Create word-of-mouth with Twitter, so that you can garner a lot of members” … and most disturbingly: a trend to assume you can get a ton of users and figure out how to monetize later.[captionpix imgsrc=http://imgs.xkcd.com/comics/networking.png captiontext=”Our company is agile and lean with a focus on the long tail. OK, our company is actually a polecat I found in our backyard.!” align=left alt=”Our company” width=500]
Can that be done? Sure. Google and Amazon have both been successful with that strategy.
Can you do it? It’s highly unlikely. As in, while you’re going for it be sure to purchase a Mega Millions ticket each week as well, that will more than double your chances of making it rich.
If your passion is to make the Worlds Most Popular Social Site for Dogs, then have at it. But if your strategy for making a sustainable, profitable business – even one you wish to sell later – is page views, social network popularity, and lots of unpaid members, forgetaboutit. Pursuing “market share” with the idea that the cash will start pouring in once you have a million (ten million? one hundred million?) users isn’t a strategy, and it isn’t wise.
Find a market need – a pain point, or an opportunity to “grease” a business operation. Address it. Well. Charge money. Lather, rinse, repeat.
And profit.