It's not so bad with Digg.com
Last week, former and current competitors of the well-known social site digg.com spread the information that the service was bought by the American media company BetaWorks for $ 500,000 - in other words, for an amount incomparable to the cost of Digg at the time of its heyday in 2008 when Kevin Rose (website creator) tried to sell it to Google for $ 200 million. Now, BetaWorks intends to combine the purchase with its little-known social service news.me and restart the project.
Digg.com, which appeared in the fall of 2004, was almost immediately recognized as one of the most promising projects of the year, and already in 2005 Kevin Rose and his colleagues Owen Byrne and Ron Gorodetsky managed to successfully complete a round of financing and get an investment of $ 2.8 million. "With a vote giving the illusion of power, contributed to a considerable increase in the popularity of the site, and Rose was already able to plan investments for a more significant period - in 2006 the site received almost $ 9 million. Almost immediately after this, Digg executive director Jay Adelson began eregovory with Google about buying his company's search giant for $ 200 million (about it as a fait accompli and was it Habré). However, some time later it became known that Google decided not to buy the site - according to rumors, allegedly due to the poor technical condition of the resource and its infrastructure. Nevertheless, even the very fact of a possible purchase of a news site by a search giant had a positive effect on investors' expectations, and Adelson successfully completed the third round of financing, receiving at his disposal another $ 29 million in venture capital.
The main mistake digg.com many call the notorious "fourth" version of the site. As a result of the mistakes made in programming and the “planned change of infrastructure”, the work of the resource turned out to be a lot of mistakes, moreover, the new site design caused criticism from many old-timers. Having received at the same time growing pressure on Facebook and Twitter by leaps and bounds, digg.com felt a serious outflow of users towards reddit.com - resource traffic in 2010 dropped to half of the number of visitors in 2008.
As a result, the BetaWorks deal, in which the new CEO of Digg.com, Matt Williams, acknowledged that the company presented the best option for reviving and developing the Digg brand, led to the fact that $ 500,000 digg.com was planning to turn back into a low-budget startup the team (however, none of the Digg employees worked for the new owner) and prompt and high-quality updates.
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However, for Digg.com owners, everything turned out to be financially relatively good. According to TechCrunch sources, Digg actually owns three companies at once: one of them is BetaWorks mentioned above, the second is the Washington Post, and finally the third is a social network for LinkedIn professionals. As a result, the total cost of the sold company was $ 16 million, which, of course, is extremely small compared to the price for which the site had previously tried to sell to Google, however, and not as bad as mentioned earlier - only $ 500,000.
If we compare the price and which assets each company bought, then the following can be noted: The Washington Post acquired the entire Digg team (developers, designers, editors), the social network LinkedIn for about $ 4 million (or less, taking into account the share of BetaWorks) for $ 12 million ) acquired a number of Digg patents, including a patent for the opportunity to vote for the material by clicking on the button (curiously, no patent lawsuits on this score were recorded, apparently).
Thus, it must be admitted that one of the pioneers of Web 2.0 was sold to different companies in parts and, most likely, against the background of powerful competitors like Reddit and Facebook, it’s unlikely that they could return to the market with Ken Rose’s brainchild. Still, the story of Digg.com and its team did not end too badly for a penny, but only its owners can be happy.
[ Source ]
Digg.com, which appeared in the fall of 2004, was almost immediately recognized as one of the most promising projects of the year, and already in 2005 Kevin Rose and his colleagues Owen Byrne and Ron Gorodetsky managed to successfully complete a round of financing and get an investment of $ 2.8 million. "With a vote giving the illusion of power, contributed to a considerable increase in the popularity of the site, and Rose was already able to plan investments for a more significant period - in 2006 the site received almost $ 9 million. Almost immediately after this, Digg executive director Jay Adelson began eregovory with Google about buying his company's search giant for $ 200 million (about it as a fait accompli and was it Habré). However, some time later it became known that Google decided not to buy the site - according to rumors, allegedly due to the poor technical condition of the resource and its infrastructure. Nevertheless, even the very fact of a possible purchase of a news site by a search giant had a positive effect on investors' expectations, and Adelson successfully completed the third round of financing, receiving at his disposal another $ 29 million in venture capital.
The main mistake digg.com many call the notorious "fourth" version of the site. As a result of the mistakes made in programming and the “planned change of infrastructure”, the work of the resource turned out to be a lot of mistakes, moreover, the new site design caused criticism from many old-timers. Having received at the same time growing pressure on Facebook and Twitter by leaps and bounds, digg.com felt a serious outflow of users towards reddit.com - resource traffic in 2010 dropped to half of the number of visitors in 2008.
As a result, the BetaWorks deal, in which the new CEO of Digg.com, Matt Williams, acknowledged that the company presented the best option for reviving and developing the Digg brand, led to the fact that $ 500,000 digg.com was planning to turn back into a low-budget startup the team (however, none of the Digg employees worked for the new owner) and prompt and high-quality updates.
')
However, for Digg.com owners, everything turned out to be financially relatively good. According to TechCrunch sources, Digg actually owns three companies at once: one of them is BetaWorks mentioned above, the second is the Washington Post, and finally the third is a social network for LinkedIn professionals. As a result, the total cost of the sold company was $ 16 million, which, of course, is extremely small compared to the price for which the site had previously tried to sell to Google, however, and not as bad as mentioned earlier - only $ 500,000.
If we compare the price and which assets each company bought, then the following can be noted: The Washington Post acquired the entire Digg team (developers, designers, editors), the social network LinkedIn for about $ 4 million (or less, taking into account the share of BetaWorks) for $ 12 million ) acquired a number of Digg patents, including a patent for the opportunity to vote for the material by clicking on the button (curiously, no patent lawsuits on this score were recorded, apparently).
Thus, it must be admitted that one of the pioneers of Web 2.0 was sold to different companies in parts and, most likely, against the background of powerful competitors like Reddit and Facebook, it’s unlikely that they could return to the market with Ken Rose’s brainchild. Still, the story of Digg.com and its team did not end too badly for a penny, but only its owners can be happy.
[ Source ]
Source: https://habr.com/ru/post/147845/
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