Engage Brain Open Mind: 3 Traits of the Most Compelling Internet Companies

Tuesday, May 3, 2011

3 Traits of the Most Compelling Internet Companies

3 Traits of the Most Compelling Internet Companies

via Mashable! by Alex Taussig on 5/2/11

Alex Taussig is a principal at Highland Capital Partners, where he invests in early stage technology companies. He blogs frequently at infinitetoventure, and you can find him on Twitter at @ataussig.
I probably spend too much time on the Internet. And because I work in venture capital, I get to see Internet products in their rawest form.
The primordial ooze of a consumer Internet product can be a beautiful thing. With the window dressing stripped away, one can often see the core aspects of what will make that product successful. Over time, I’ve begun to see a few patterns emerge.
Here are three key characteristics of those that often do become a success.

1. Photos: The Root of Online Ego

I didn’t think Facebook was a big deal — that is, until photos became more prominent. Facebook photos became the outlet for the ego of a college student. “Look at this cool Halloween costume!” “No way, you were at that party too?” “OMG, I can’t believe you did THAT in the dining hall!”

I’ve gotten older, and so have my friends, but not much has changed. Fred Wilson recently called Facebook “a photo sharing site with some chat attached.” Photos — the most ego-expressive form of media — still dominate my personal usage of Facebook. And, besides social gaming (yes, your farm is an expression of your ego), no other feature has really caught on in the same way.

Perhaps we’re seeing the second turn of the photo-ego phenomenon with Instagram, Picplz, Pixable, Path and now Color. The human desire to share mementos of life with close friends (or, in Color’s case, complete strangers) is powerful and will always be the low hanging fruit for Internet products to pick.

2. Immediate and Unexpected Value

When was the last time you really got that “OMG, yes!” feeling from an Internet product? It doesn’t happen that often. Decent products do exactly what they promise they’ll do. Great products give you something you couldn’t otherwise anticipate.

Take Quora as an example. I answered the question, “As a co-founder and CEO of a startup, should I hedge my position? If so, how?” Almost instantly, I had 25 up-votes and four comments. The engagement itself wasn’t unexpected, but its immediacy was. The fervent, yet qualified pace of information curation on Quora was like nothing I’d ever experienced. It made the process of answering questions addictive, as I knew a good answer would become visible quickly.

This kind of added value works in ecommerce as well. While I’ll personally never know the joys of RentTheRunway, I know many women “get it” when they realize they can order multiple dress sizes send back whatever doesn’t fit, all with free shipping both ways. In the early days of Zipcar, I remember moving to a new apartment and “magically” finding that there was a car in the parking lot next door via their online map tool. Very cool.

3. Familiarity Fosters Engagement

An old biblical phrase also rings true for technology: “There is nothing new under the sun.” The Internet of the 1990s attempted to bring the physical world online, and mostly failed, in my opinion. The 2000s focused on making Internet products easy to use for everyone, not just early adopters and “digital natives.” The 2010s will continue to improve those products by making them social, mobile and location-aware.

The essence of what these products do, however, will remain similar to their predecessors. And that’s OK. Novelty is great for early adopters, but the masses want familiarity. They want to find something they already know in a product.

The best example of a new product with undeniable familiarity is the iPad. In the iPad’s original TV campaign, Apple coined a brilliant marketing line: “You already know how to use it.”

Dropbox is another great example. It’s a folder that sits on your desktop and acts like every other folder you already know how to use. Never once mentioned is the word “cloud” or any other jargon used by the tech in-crowd.

You can usually find a hint of ego, serendipity and familiarity if you dig around a bit in the primordial ooze of a compelling Internet product. True success requires hundreds of other things to go right, but at least you’re on your way!

Disclosure: The author is an investor in Pixable and RentTheRunway.