Investing Strategy in the Wacky World of Web 2.0

Dead 2.0 takes a sad and hilarious look at the announcement by Mr. Web 2.0 that he is an investor in Dogster.  It’s a great read for anyone who thinks Web 2.0 business is the same as non-Web 2.0 business.  Among my favorite quotes from the story is this one (quoting the wonderfully named Bambi Francisco):

A smaller number pay roughly $20 a year, to get storage for videos, and photos, and the ability to IM other members on the site, using their pets as avatars.

I honestly don’t know if that’s true or not.  I actually hope it isn’t true, but you can never tell.

I had a flying squirrel as a pet when I was a kid.  I’m looking forward to Flyingsquirrelster.  Other of my childhood pets would hang out at Duckster, Owlster, Rabbitster, Greensnakester, Tadpolester (later that one would graduate to Bullfrogster) and, of course, my pet Ben would spend his time at Crawfishster.

I will say that at least Dogster has a targeted demographic that should make ad buys appealing to pet food makers, pet supply stores, the Hallmark Channel, etc.  And Peter Lynch made a fortune for himself and others by investing in things he liked.

The problem I have with Dogster is the problem I have with a lot of the Web 2.0 companies de jour- the play dough doctrine.  The apparent approach of so many of these companies is summed up nicely by The Stalwart:

It only reinforces my conviction that few people have any idea of what will work and what won’t.  There’s a lot of spaghetti throwing in business, just to see what noodles stick.

The exposure from Mr. Web 2.0 will likely quadruple the prospects of Dogster, so maybe in a year or so it will be an internet juggernaut (or bought by Petco).

In the wacky world of Web 2.0, anything is possible.

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