When I first started my own business, I thought my ideas had to be complex. I thought the road to entrepreneurial success was a complex business plan. Maybe because I come from an engineering/scientific background this is why I thought this way. I thought the harder the idea was to execute, the harder for others to enter that same business. This barrier of entry would make my business more profitable.
Some of the startups I’ve worked for were very well funded VC startups and had some of the best and the brightest talent. Yet they failed anyways. One startup I worked for sold a very expensive B2B solution, with a 8 – 12 month sales cycle. Yes the payout could be huge, but if it didn’t sell a lot of human capital, money and time was wasted. Then, on top of that, the product required many months of customization and integration within the customer’s business process. So from the beginning of the sales process to completion was about two years in the making. The company was doing very well, until 2001 when the market collapsed. Their sales cycle slowed down to nothing, and they eventually went out of business two years later.
It’s not how great the business idea is, but how well its executed.
Take the Drudge Report for example. The web page design is circa 1995. Nothing is special about this site right? Love or hate the site, most people think it can’t be generating much income, right? You would be very wrong. 24/7 Wall Street estimates the site to be worth $48 Million.
From a technical standpoint, saying the site is unremarkable is putting it nicely. The web site is a simple static one page, no dynamically generated web pages, and is designed very poorly. The site design doesn’t try to optimize for search engines, or user optimization to get people to click on links. There’s no above the fold site design or site navigation.
The great thing about the Drudge Report is that most of the content isn’t written by them. It just summarizes the news from other web sites, with a slight slant. The Drudge Report is selling one thing. It’s selling a viewpoint that is missed by most of the mainstream media. By focusing on this angle and niche that other news outlets have missed, Matt Drudge has made out like a bandit.
A recent study found that the Drudge Report drives more traffic to a web site than Twitter or Facebook combined! I would believe that stat based upon my experience in dealing with referring Drudge Report traffic. This is simply profound for a little web site with no real social media strategy.
There are a total of three people that manage the web site, if you include Matt Drudge. In 2003, Business 2.0 magazine estimated the web site generated $3,500 daily. It is pretty safe to assume the web site makes at least double that today, if not more. So for a business that generates over $1 Million in annual profit, with very little overhead, I’ll take that business any day.