This week, tech portal CNet bought a tiny dating website, Consumating. The site was created by two guys who’ve been around the Web for awhile. One is an Internet rockstar and the other created the Google bomb (and now works for Google).
Contrast that with Yahoo!’s purchase of a social bookmark site. While del.icio.us started as a personal side project, too, it was VC-funded in April.
Comparing these two is sort of apples and oranges, but that’s my point. Though terms weren’t disclosed for either deal (both tiny for their buyers), one would assume that del.icio.us went for millions and Consumating did not. I’m an avid user of del.icio.us and have never touched Consumating, but I can’t help but think CNet got the best deal here. CNet went outside of the bounds of what we’d expect from a big company.
Enter Moneyball, the 2003 book about baseball, the Oakland A’s, and “The Art of Winning an Unfair Game.” Using simple baseball statistics, General Manager Billy Beane was able to field a competitive team with a relatively small payroll. Many have noticed the similarity to venture capital.
So, CNet took a Beane/VC approach. Invest in something good that no one else has. It’s cheap and could have just as positive an outcome.
Duv I heard that CNET offered BB several million for Consumating. That said, I agree that del.icio.us was probably sold for more than Consumating.
Wow. It is Bubble 2.0! 🙂
Yeah, my point was that the bang for the buck is pretty squarely in the smaller acquisition.