Already a Bloomberg.com user?
Sign in with the same account.
Eons and TeeBeeDee both court the over-50 crowd, but their diverging paths illustrate the differences between Web 1.0 and Web 2.0
In the summer of 2006 my inbox was flooded with pitches from new Web companies hoping to bring some of the MySpace (NWS) magic to the largest and most neglected demographic on the Web: baby boomers. Makes perfect sense. Boomers represent a huge market, and more than 65% of Americans between the ages of 50 and 70 use the Internet. Many would feel out of place on MySpace or Facebook, though they'd still like to connect online. And advertisers who use the online medium would certainly like to reach them.
A year later, many boomer-focused sites are discovering it's a lot harder than they thought to build a MySpace for adults. There are plenty of contenders, including Gather and BoomJ. But the duo that most interests me is last year's glitziest entrant, Eons.com, and a scrappy newcomer, TeeBeeDee, standing for both "the boomer demographic" and "to be determined," a reference to the options open to people in the postkids and retirement stage of life.
Eons and TeeBeeDee are a study in the contrasts between Webs 1.0 and 2.0 and how each generation of companies views—and tries to conquer—its respective corner of the world.
A Portal for All Things Boomer
Reminiscent of an earlier Web era, Eons has pedigree, cash, and eyeballs: Founder Jeff Taylor previously founded Monster Worldwide (MNST); Eons has raised $32 million from Sequoia Capital and General Catalyst Partners; and it gets about 600,000 unique visitors a month, according to comScore (SCOR).
Headquartered in Boston, Eons launched with fanfare, issuing press releases about its cash, early advertisers, and how Taylor—a few years shy of 50—left a cushy job to start this new venture. Reporters ate it up (BusinessWeek.com, 10/16/07). And since free press only gets you so far, Eons began spending hundreds of thousands of dollars a month on marketing.
Taylor also did copious market research and found that virtually none of his focus group participants wanted anything to do with social networking. So Eons began as more of a portal for all things boomer, with a staff writing articles about life-changing topics boomers face. Taylor soon discovered his focus was wrong. An article on how to quit smoking would get a paltry 30 page views, while a posting from a user who hadn't smoked in 51 hours but said he was tempted to have a cigarette would get 300 comments. "It was clear people wanted to talk to each other, not get talked to," Taylor says.
Indeed, much of the early Eons approach was out of step. Credentials, lavish spending, even large audiences—all of it was paramount in the 1990s, when entrepreneurs dreamed more of huge brands than useful sites, and getting to market first was more important than getting to market right. Spending millions of dollars—including on TV commercials—to buy traffic, as Eons did, is now anathema to many who lived through the excesses of 1999 and 2000 and paid dearly when it all crashed. Better to invest in engineers who can build a product so indispensable it spreads on its own.
Authenticity Over Market Research
Compare all of this to TeeBeeDee, begun by Parenting magazine and CNET Networks (CNET) veteran Robin Wolaner. The company has put out a grand total of two press releases and spent a few thousand dollars on marketing. It has raised a modest $7.5 million from Shasta Ventures, Monitor Ventures, and several angel investors including Ron Conway. Wolaner has hired just 19 people. TBD did some modest market research but ignored most of it. Wolaner says she learned to distrust research after working in Penthouse magazine's promotion department, where she used market research to "prove" to advertisers that people bought the magazine for the articles, not the pictures.
Instead, her team mostly built what they would like to see online and figured they'd iterate from there. That's much the way some of the most successful Web 2.0 startups, including Yelp, Digg, and Facebook, were born. TBD is a lot like those companies in other key ways: It's housed in a dingy, anonymous building in San Francisco's South of Market district. Desks are scattered around a wide open space, there's a buzz of activity, and everyone is dressed casually, many in TeeBeeDee T-shirts. The only difference: Almost everyone working there is over 40.
Which underscores another key Web 2.0 hallmark: authenticity. Every great social networking site was built by someone the community can trust and relate to. Early on, college kids and recent graduates could identify with Facebook founder Mark Zuckerberg. And what early MySpace hipsters didn't have a little affinity for the ubiquitous, automatic first "friend," MySpace co-founder Tom Anderson, even if he was lying about his age? Building a site by listening to hundreds of thousands of vocal members is hard work, but the more a site is built for you and your peers, the easier it is to understand what they have to say.
What to Do Next
Since Taylor, 47, can't even join his own site, which bars anyone under 50, Eons is breaking the cardinal rule of the Web 2.0 handbook from the get-go. Wolaner's site, on the other hand, has no such restrictions, because it's focused less on that pivotal birthday and more on the stage of life when you start to see more wrinkles, your career may be less important, your kids are out of the house, and you're figuring out what comes next. It's her stage of life. Wolaner, 53, knows well the feeling of getting that first AARP mailing at 50. It's not "Oh, great, I get a discount!" she says. Instead, it's "Ew, am I really old enough for this?"
To its credit, Eons has adapted well to at least one Web 2.0 way of doing business: iteration. The site has learned from early mistakes and reacted swiftly, recasting itself as a social network. Eons has slashed marketing and hopes to take off through word-of-mouth instead. The feisty Taylor is coming around to the benefits of a small but loyal community, over a mass torrent of clickers who don't stick around. "Everything about me is saying we need to get this business to grow, but I am learning to do things differently this time," he says.
Capital Can't Buy Community
As a result, the distinctions between the sites now are diminished. Both recognize that boomers want a site that will help them meet new people and organize around common interests. Both understand they have to be simple and intuitive so they lure more than just early adopters. And, Eon's early missteps aside, both realize listening to users will get them there.
So who will win? Part of that answer depends on what each company counts as success. Expanding to 600,000 users in a year clearly wasn't enough to support Eons' original business model, prompting layoffs of 35% of its staff. But TBD, with its lean staff and expenses, would be thrilled to hit those numbers sometime in the next year. Because, at its core, TBD gets something Eons still may not: To build a huge Web 2.0 company, it's not about getting big fast, it's about getting it right first and then growing. A community needs to love your site, and no amount of venture capital or advertising can buy that.